Gaming Firm Sea Cofounder David Chen Is Singapore’s Newest Billionaire

Singapore-headquartered gaming and e-commerce firm Sea, best known for super hit mobile game Free Fire, has just minted the city-state’s newest billionaire. Sea’s shares have been on fire as more people indulged in gaming and online shopping amid the coronavirus pandemic, making cofounder David Chen a member of the ten-digit club for the first time. With a 2% stake in the New York Stock Exchange-listed company plus options, Chen boasts a net worth of $1.1 billion.

Currently trading at $109, Sea’s shares are up 57% from mid-May, when it reported first-quarter revenue of $714.9 million, double from a year ago. Its online gaming unit, Garena, accounts for more than half of total revenue, thanks to the worldwide cult following that Free Fire enjoys. With more than 80 million peak daily active users, it was the highest grossing mobile game in Southeast Asia and Latin America in the first quarter of 2020, as per App Annie, a provider of mobile data and analytics.

Chen, 39, who is chief product officer at e-commerce arm Shopee, is Sea’s third billionaire after founder and CEO Forrest Li and chief operating officer Gang Ye, who is also a cofounder of the company. The run-up in Sea’s shares, which have tripled from a year ago, has boosted both their fortunes to record levels. The company, which went public in October 2017 at $15 per share, is now valued at $52 billion.

Started in 2009 as a publisher of games, Sea has attracted some big backers, including Tencent, which has a 20% stake, private equity firm General Atlantic and Kuok Khoon Hua, Malaysian billionaire Robert Kuok’s youngest son. As it branched out into e-commerce, online payments and social networking, Sea, then called Garena, became Singapore’s first internet unicorn in 2014.

A computer engineering graduate from the National University of Singapore, Chen worked at Temasek-owned port operator PSA Corp before turning entrepreneur. Prior to his current role at Shopee, he was Sea’s chief operating officer and chief of staff. The mobile-centric consumer marketplace has picked up pace: revenue in the first quarter of 2020 was $266.5 million, up 104% year on year.

In a July report, Citibank analyst Alicia Yap noted that lockdown measures boosted online shopping across southeast Asia, a trend that she says points to a structural shift. Bullish on Sea, Yap has raised the company’s target price to $138 from $79, reflecting stronger gaming and e-commerce fundamentals.

CLSA Singapore analyst Marcus Liu, who has an outperform rating on Sea, notes that Shopee’s vast database of customers across the region gives the company an edge in another potential business. “Sea has a very strong chance of winning one of the two new full digital bank licenses here in Singapore.”