Tencent executive refutes criticism company has forsaken innovation to buy growth
Tencent executive said the company ‘is not an investment bank’ and that its investments are made to contribute to its core businesses
A senior Tencent Holdings executive has come out to defend the Chinese internet giant’s strategy of backing multiple start-ups, saying the company is “not an investment bank” in the most comprehensive comments after industry observers accused it of prioritising investment over innovation.
Jeffery Li Zhaohui, managing partner of Tencent Investment, addressed an ongoing debate about whether the internet giant has “lost its dream” in an interview with BusinessWeek China published on Thursday. Tencent confirmed information in the interview but declined to provide further comment.
The debate was sparked by a former tech editor, Pan Luan, who wrote an online essay in May criticising Tencent for driving growth these days through investments rather than original innovation.
“It’s totally wrong to put investment and self-developed business on opposite sides,” Li said in the interview. “It’s a misunderstanding of us that when investment is properly done, it would be bad for our own self-developed business, or that a certain business is weak because Tencent is more focused on investment.”
The company’s investments have contributed directly to Tencent’s core businesses, such as in games, by establishing long-term partnerships and securing the best games. Investments have also paved the way for the company’s expansion into new areas, he said.