Tencent was said to have invested US$ 100M in China’s social networking service Kaixin001, according to people close to Tencent the Chinese internet giant.
Founded in March 2008 by former Sina interim CTO, Kaixin001 appeals to China’s white-collar workers with it’s made in-house social games such as “Parking War”(争车位), “Happy Farm”(like Farmville) and so on. I still remembered Chinese media raved about the service with unbroken string of reports saying how much people adored and addicted to Kaixin001’s games – especially Happy Farm – that some addicts even set up alarm to wake them up in the dead of night so they could harvest(or stole) their virtual neighbors’ “digital” crops before the owners themselves do so.
Kaixin001 had its peak in 2008 and 2009, while now is suffering from drastic traffic drop that the site saw its traffic has plummeted 65% over the past 18 months.
Qihoo 360 also reportedly tried to invest in Kaixin001, while the Beijing-based company turned down the offer.
Tencent had its own social networking offerings including extremely profitable QZone and independent SNS Pengyou.com Nonetheless, like other Tencent products, these services were flooded with teenagers, students while lacking of its long-desired white-collar workers group – bunch of Tencent products are facing the same pitfall. By investing in Kaixin001, Tencent will have access to Kaixin001’s high-quality audiences to complete its user pool.