Here Come the Viet Gamers
Rebecca Fannin
Forbes Asia Magazine dated February 08, 2010
Can IDG add its Tencent magic to a mini-Shanda?
Perched above a Big C supermarket on a street jammed with bipeds dodging mopeds, the Ho Chi Minh City headquarters of VinaGame is easy to miss. But inside, amid funky warehouse decor and lots of young staff (see photo) glued to big computer screens, sits Vietnam's leader in online gaming and social networking services. VinaGame aims to be one of the first homegrown Internet successes in its would-be tiger economy, a Vietnamese counterpart to China's huge hits, Shanda Interactive Entertainment and Tencent.
With stated 2009 revenues of $50 million on the back of what it says is 50% annual growth, VinaGame is capitalizing on Vietnam's rapid rise of digital communications and consumerism. Its chairman and chief executive, Le Hong Minh, 32, is an avid gamer himself.
Yahoo! BuzzSo much of one, in fact, that he aborted a financial career to start VinaGame in 2004 with a few fellow gamers. Duty calls now, however: The Saigon native has cut his playing time to one hour a day from his previous four to five hours.
Shy and modest about his accomplishments, which previously entailed posts at Vina Capital Group (no connection) and PricewaterhouseCoopers, Le nevertheless has big dreams. In a barely audible voice, he confides that he wants to take his startup public within a few years on Nasdaq or the Hong Kong Stock Exchange.
A large player in a relatively small pond compared with China or Korea (see table), VinaGame, by its own estimate, has a commanding 65% share of Vietnam's $109 million online-games market. Its titles, such as a localized version of Kingsoft Corp.'s Swordsman Online, attracted 3.5 million to 4 million gamers a month in 2009.
VinaGame also has moved into social networking--and plans to rename itself VNG to reflect its broader services. Two years ago it introduced the Zing.vn portal. Web research service Alexa.com ranks Zing.vn behind only Google and Yahoo in national Web traffic. Meanwhile, ZingMe, which offers music, entertainment, news, e-mail and instant messaging, leads the market with 4 million active users. "VinaGame is being modeled after Tencent," says Benjamin Joffe, chief executive of Asia-focused digital strategy and research firm Plus 8 Star in Beijing, referring to Ma Huateng's popular Internet and instant-messaging service, now worth billions on the Hong Kong exchange.
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