In short, pretty bizarre financial engineering going on with Chinese industrial companies buying western gaming start-ups for enormous sums in order to buttress their (chinese) own bottom line and keep the shares going up on the Chinese stock market. This is a type of pyramid scheme that is bound to come crashing down at some point, and bankrupt every single one of these companies.
It makes me think of a recent write up on modern day money laundering. One way to do so is to have an app with in game purchases, your mules buy burner phones and start buying in-game stuff using their phone account. Money goes into the wireless store, comes out of the App store. "Honey are you launding drug proftis?", "No dear, I'm just addicted to HoneyBear Racers!"
The sad thing is -
Chinese investors/CEOs then need to get the money out of China because they know it will crash eventually.<p>So they invest in hot real estate markets like Canada, US and Australia causing house prices to go to stratospheric levels and make it un-affordable for the locals.
30 Rock did it first<p><a href="http://i.onionstatic.com/avclub/5224/22/16x9/1200.jpg" rel="nofollow">http://i.onionstatic.com/avclub/5224/22/16x9/1200.jpg</a>
I can remember 1999 & 2007 there was money everywhere and no one quite knew where it was coming from. The money pouring out of China feels really similar. It makes me nervous.
Can someone be kind enough to tell me how I could get in touch with a possible VC / or company from china who might be interested in investing in an RTS I've spent about 4 years making?
This is one of the great things about free trade. The US sends trillions of dollars to China to pay for manufacturing services, and the Chinese are forced to spend that money in the US. They can buy services, or US Treasury bills, or private investments, but sooner or latter the money has to come back. And there is so much money involved there are some pretty dumb investments being made.
I know a guy in Toronto who used to offer loans from the Caymans to Chinese CEOs secured by 2x stock. If they default, he keeps the stock. So they take out a massive loan then immediately default. He sells at market, anything above half is profit. $100Ms.
We talk about smart money and dumb money. Lately I've been calling this stuff "weird money."<p>I've been hearing a lot of weird stories about weird money in the last few years. My favorite involved an investor who could not be located when the company was sold. Phone was disconnected, company did not exist, etc. Not sure how that shook out. Maybe the proceeds get held in escrow for a while and then distributed to the other investors if the owner never shows?
Huh. Both my kids loved Tom the Cat around age 3-4.<p>From my experience, I have to assume the majority of their <i>hundred million dollar</i> revenue comes from kids randomly mashing on ads, or somehow managing to make in-app purchases. (Like most free apps targeted at kids.)<p>Kudos to the developers, but even aside from the ethical issue (which rests more with the ad networks than the app makers imo), seems pretty risky to spend more than 1-2x revenue on this thing, given the risk of changes by Apple/Google that could wreck the revenue model.