Eyeing international expansion, China-based selfie app maker Meitu acquires a 31% stake in game publishing company Dreamscape Horizon for ~$340M
Rita Liao / TechCrunch :
Context & Ripple Effects
Meitu has been searching for a second act since its Hong Kong debut: after filing at up to a $5.2B target valuation, it closed flat on its first trading day in December 2016 having raised $629M at $4.6B — an underwhelming public-market reception for a selfie-app business with hundreds of millions of MAUs but unclear monetization.
The company has since leaned on hardware leverage instead of new apps, licensing its brand and camera software to Xiaomi phones in a November 2018 partnership. A 31% stake in game publisher Dreamscape Horizon for roughly $340M extends that playbook from brand licensing into content ownership, with international expansion named as the goal.
First-order effects
- Meitu converts part of its IPO-era balance sheet into a gaming asset, giving it a publishing pipeline whose revenue does not depend on selfie-app engagement at home.
- Dreamscape Horizon gains a well-capitalized strategic shareholder with distribution reach across hundreds of millions of Chinese mobile users.
Second-order effects
- Other Chinese consumer-app companies facing saturated domestic photo and social markets face pressure to follow the same route — buying game studios or publishers rather than building overseas user bases app by app.
- Game publishers with international catalogs become scarcer, pricier targets as consumer platforms like Meitu compete with each other for content assets.
Third-order effects
- If the pattern holds, Chinese consumer internet firms increasingly internationalize by acquiring content and publishing capability abroad rather than exporting their flagship apps directly — a structural shift in how China-built consumer brands enter Western and emerging markets.
The trend: Chinese consumer app companies are internationalizing by acquiring gaming and content assets rather than pushing their core apps into foreign markets alone.