Happy Birthday, Sea!

2022-5-8

Dear Sailors,

Today, May 8, 2022, Sea celebrates our thirteenth birthday.

So much has happened since my last Birthday note to you a year ago! At the time, we were experiencing the fastest growth we had ever seen in our company’s history. In October 2021, the 4th anniversary of our IPO, our share price hit an all-time high. Then, in the following 6 months, together with much of the rest of the tech stock market, it took a tumble.

A year ago, no one would have predicted this. Tech shares were on what seemed like an unstoppable surge. But the market has since taken extreme turns. I know it has been unsettling for many of you to watch our share price fall. As we ride out this wave, let us use this anniversary milestone to pause and reflect.

Looking back

What has changed in one year? Much in the external environment, but at Sea, our fundamental priorities remain the same. In last year’s Birthday note, I wrote to you about the need to stay humble, serve the under-served, embrace being global, and keep technology at our core – these continue to be key. And, despite the ups and downs in our share price, we are still growing steadily. In 2021, our annual revenue hit $10 billion for the first time. Garena and Shopee now serve a combined 500 million customers every month, from the East to the West of the world. From our IPO four and a half years ago, our share price has increased 5 times, even at today’s price. These are amazing milestones we should be proud of, the results of all your hard work and commitment!

In fact, in some ways, I write to you this year feeling better than I did a year ago. This might seem surprising, because at the time we were going through what seemed like unending successes. We posted incredible growth every quarter, and every announcement was a happy one – new offices opening, our user base expanding, our revenue always climbing. But, as I shared with you in that Birthday note, I felt worried. We were going through good times untested, and though we had faced challenges before, we had done so as a much smaller and less complex company. I couldn’t be sure how well we would weather the next storm when it inevitably arrived.

For any company to become a lasting institution, it must be able to deal with both the good times and the hard times well. The past 6 months have been a hard time for Sea, with the world going through big transitions. The global economic cycle is turning, with inflation and interest rates on the rise, causing volatility in the capital markets. Countries are emerging from the pandemic and rejoining the offline world. And now, war in Europe is creating fear, uncertainty, and resource constraints across the globe.

These factors are out of our control, but they could affect us. They are the choppy waters over which we must sail.

We have not yet weathered this storm – we are still going through it. But if I may make an early assessment, I think we are doing pretty well! We have read the changing winds and adjusted our course. Despite being a much larger ship, we have still been able to act nimbly and move quickly. And we have managed to come together in solidarity to make difficult decisions.

One example was our decision to pull Shopee out of two markets, India and France. Many people questioned us on this, but it was a necessary move to adapt to changing circumstances. In last year’s Birthday note, I wrote about the importance of Sea retaining a start-up mindset no matter how big we become. This means being willing to experiment, learn from what doesn’t work, prioritise so we can better focus, and if need be, move on – wiser and stronger than before. And so we have decided to prioritise the markets that we think hold the most exciting opportunities, and focus on achieving excellence there.

Although the last 6 months have been challenging, how we have dealt with them has shown me that we are maturing, and reassured me about the future of our company. When times are good and growth is strong, all decisions are easy. When we have to choose between options that each have a cost – choices involving some sacrifice – that’s when we become clearer on our fundamental priorities, values, and what we want to achieve.

That is what I saw happen when the pandemic began two years ago. I am sure we all remember the fear and uncertainty that ran through the company about what it would mean for us. And it was difficult to watch the communities we served going through so much pain and suffering.

Our response was not to try to retreat to safety or wish away reality. We doubled down on our mission. We focused on serving the communities we were in, both by adapting our businesses to meet new needs and in contributing where we could – helping with vaccination drives, partnering with governments to roll out assistance, and using our platforms to spread life-saving information. In the end, despite all the challenges the pandemic brought, we managed to grow rapidly and meet heightened demands for our services.

With the world going through upheavals again, it will still be the under-served, lacking access to options and opportunities, who will suffer the most. Let us continue to remain focused on helping them, just as we did in the wake of the pandemic. Bringing joy to communities and enabling ordinary people to do more – this is how we can contribute to making the world better for all.

Looking ahead

Economic cycles like this are normal. The world is always going through phases where growth accelerates, then slows, then accelerates again. But one constant through those cycles is how advancements in technology, over thousands of years, have steadily improved quality of life. This is the larger arc in humanity’s progress that I want Sea to be a part of – using technology to make the greatest positive impact on the most lives.

For this reason, we will be investing heavily in research and development to improve on and create new technologies. This will be the biggest area of capital investment for us. I am excited to see what new and better things this will enable us to do! As I have said to you before: we are only at the beginning of our journey to make a lasting mark upon the world.

A second area we will continue to invest in heavily is our people. We started Sea because we wanted to build a place where talented people can thrive and achieve the unimaginable together. I feel lucky that we have a team that loves to work together, that cheers each other on, that is driven to pursue excellence always. Such a culture is precious; hard to build and easily lost – especially when a team grows as quickly as we have. The only way to sustain it is to always keep people-related decisions at the centre of what we do.

That is why we have been bringing some of our brightest talent into our People team, such as Lusha Feng and Alice Nguyen, who look after people matters for Garena and Shopee respectively. Both joined us in July 2013 as fresh graduates. Lusha started out in mobile games publishing, and within 3 years took charge of Arena of Valor, one of Garena’s biggest revenue generators. Alice also hit the ground running, going to Thailand to build the ground team from scratch. By the time she left Thailand a few years later, the team she built was 600 strong and growing.

More than 2 years ago, we asked Lusha and Alice, both of whom were doing great work in their businesses, to cross over to the People team. It was a completely new field for them, but they took on the challenge readily. We wanted them there because of their deep understanding of our businesses, which would help ensure that our people initiatives are tightly coupled with business needs. Their teams are doing great work making sure we do everything we can to enable and empower all Sailors.

As we keep growing, the work of our People team will become more challenging, complex, strategic, and data driven – a great place to grow and learn new skills. If you feel that, like Lusha and Alice, you have insights from our businesses that you want to apply to this challenge, join them! The more shared understanding we have between the teams working on people matters and business matters, the stronger both will be.

Building on from here

The last 13 years have been an amazing ride, laying a strong foundation for us to build on to reach even greater heights. We have much to be proud of. From nothing, we have built something that has changed hundreds of millions of lives – and I know, with hard work, we can change hundreds of millions more! Everything we have done and will do is a credit to you: without our talented, capable, and committed team, none of our success would be possible.

As I said to you in my last Birthday note, I hope you will continue to take pride in our goals, not our status. How we see ourselves must remain steady, regardless of the choppy waters around us and whether people are cheering us on or not. Whatever happens in the outside world, do we believe in our business and our ability to make a positive difference to our communities? Absolutely. We are doing it every day.

With travel restrictions easing this year, I am looking forward to being able to meet many more of you in person. I am more excited than ever about our future. Stormy seas make us sail a tighter ship. Each time we face adversity, I have seen us grow closer, become more focused on our goals, and hold on more firmly to our values. All of this encourages me greatly, and makes me even more confident of our ability to overcome anything that comes our way.

We control our destiny; we keep going; our bright future is in our own hands.

Happy birthday, Sea!