Sunday, September 18, 2005

Seeking the Next Baidu

Perfect World - 1

(report under progress, with updated details coming soon)

It had been a hot topic in the media on who's going to be next Google.

Baidu splashed out on the Nasdaq on the first day of trading. It is believed to be the next Google due to it's undisputed title "China's Google".

With a dynamic economy and the sprouting of high tech companies started by smart and well-educated entrepreneurs in China, Venture capitals and other investment money have been pouring into China's internet industry.

With dramatically increased businesses from large international banks and brokerages as well as Nasdaq market, there are many more companies will try to get listed on Nasdaq which will give American investors chances to invest in an economy that grows more than twice faster than that of the US.

With the astonishing success of Baidu's IPO debut, you may ask who will be the next Baidu?

One obvious answer would be Alibaba with whom one magical word of "saseme" would open up a ton of treasures hidden behind the door.

After Alibaba bought Yahoo.China and Yahoo bought 40% of Alibaba with $1 billion cash, Alibaba suddenly become the largest internet giant in China. Now with China's Ebay combined with China's Yahoo, you have an internet wonder in the making. It could soon come to Nasdaq after it's reorganization under wrap.

But here, I predict another company will perform as well as Baidu if not better when it comes to Nasdaq.

The company is the Perfect World(

In the ongoing national competition of online games, they virtuely exploded like a volcano with the "Perfect World", leading in three categories from all the "most expected" online games. But that's not the whole story, they are not just leading, but garnering an unbelievable 73% of all the votes!

Tuesday will be a historic day for China's online gaming industry. The online game(MMORPG) "Perfect World" will be up for public beta-testing. There is already a frenzy going on from online game players and the media. There are also many communites and clubs set up already waiting to participate in the game.

The company is almost unknown a few months ago, but it's predecessor and it's founder were not just well known but already celebrities in China.

HongEn Software was one of the leading educational software developer for K12 shcools and is still well-known in China. They have owned about 17% of the total education software market in China in 2002.

The Chairman of the company, Yufeng Ci is also a young celebrity. He won the national "Chinese Young Prodigy Award" of software industry and was the youngest among the 10 winners in 2001.

In 2002, He won the"Top Ten Entrepreneur Of Zhongguancun" award. His name is inscripted on the "Star Wall" in Zhounguancun, a high tech zone in Beijing famed as China's Silicon Valley.

In the same year, He also won the "Outstanding Young Entrepreneur" award from City of Beijing.

The educational software market has slowed down since 2003. Last year, Ci decided to make a major shift from educational software developer to online game developer.

The new company named Perfect World in anticipation of the release of their major product "Perfect World".

HongEn Software is no stranger to the online gaming society. Their development team has produced the "Freedom and Glory" which was also well-received in Korea. And the other major gaming product "The Great Qin Warriors", a 3-D interactive game was also well received and has also been sold to Korea and US.

The development team has been quiet for last three years and for a good reason.

We know both Shanda and Netease are doing quite well on Nasdaq due to the popularity of their online games. The great business part of these companies is the fat margin of 90% in online gaming.

The goal of Perfect World is to develop online games that rich in Chinese culture and they intend to be a major player in world's online gaming stages. They also intend to develop e-commerce around their player communities which will partially based on game-associated merchandizes.

Here is their front page in Chinese.
(more details to come)

see Perfect World - 2


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