What’s behind Sea Group’s crazy growth?

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Hi readers,

Shopee has become a huge part of my life. I order almost everything through its app, from my new desktop monitor to planters for my mother’s attempt at a herb garden. I’ve even developed a habit of scrolling through the app when I’m bored, looking at what its algorithms have to recommend. (Sometimes, I even buy something from these recommendations. My wallet weeps.)

I’m just one of the millions of users whose activities have helped drive the growth of Sea Group, Shopee’s parent firm. The company posted its earnings for the first three months of 2021, and it’s growth is nothing to scoff at.

Today we look at:

• Sea Group’s growth, what’s behind it, and what’s next
• This startup’s (literally) stratospheric ambitions
• Other newsy highlights such as ByteDance’s leadership change and Oyo’s Covid-19 bereavement policy

(By the way, we’re holding our Tech in Asia Pitch Night in June and registration for startups is closing this week. Sign up to get a pitching slot and receive feedback from investors and prizes of up to US$5,000 in cash.)

PREMIUM SUMMARY

On the up and up

Southeast Asian tech giant Sea has announced its financial results for the first quarter of 2021, and the numbers are looking pretty good. For the record, group revenue for the quarter was at US$1.8 billion, marking a 147% year-on-year increase. But what’s more exciting is how that growth happened, and what else is in the cards for the company.

• Fuelling the Fire: Garena, Sea’s gaming business, is doing well. Aside from its flagship game Free Fire, the firm is introducing new formats and features such as Pet Rumble, Free Fire’s version of Among Us, the popular multiplayer social deduction game. It also plans on introducing a social dimension to the game, which might go over well with the more casual audience that Free Fire attracts.
• Shopaholics in the house: Shopee, Sea’s ecommerce unit, experienced strong year-on-year revenue growth and saw improvements to its bottom line. It also saw it’s EBITDA per order hitting a new high of negative US$0.38, up from negative US$0.41 previously – a good sign, given that a positive EBITDA per order is necessary for the sustainability of the business.
• There’s lots more: Sea’s food delivery and logistics businesses are effective but more low-key. What’s really growing is it’s digital financial services: SeaMoney saw 26 million paying users in the first quarter of 2021. And it’s an area that’s going to grow even bigger as Sea intends to develop its digital financial services business in areas such as insurance and wealth management.

Read more: Sea Group sees blistering growth, hints at bolder vision for Free Fire

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