How the founder of a high-flying game streaming site wound up in massive debt
Wang Sicong is the son of one of China’s richest men, but the collapse of Panda TV resulted in courts hitting him with spending limits
Wang Sicong, the Chinese billionaire’s son who famously gifted his dog eight iPhones, was once touted as China’s “most eligible bachelor.” But lately, the 31-year-old entrepreneur has accumulated so much debt that he’s been hit with spending restriction orders multiple times.
The main culprit? His failed esports streaming service.
In recent weeks, Wang was placed on the country’s list of “discredited individuals” by a Beijing court for owing 151 million yuan (US$21.4 million). The list comes with some harsh restrictions: Wang currently can’t play golf, buy property or stay in upmarket hotels. He’s also been hit with spending limits imposed by courts in Shanghai.
The only way off the list is for Wang to pay off all his debt. Meanwhile, a Beijing court has seized some of his assets.
Wang’s investment company, Prometheus Capital, did not respond to phone calls and emails requesting comment. We also reached out to Wang on social media but did not hear back by the time of publication.
The latest development is a dramatic turn of events for the son of Wang Jianlin, the billionaire founder of real estate developer Dalian Wanda Group who was once the country’s richest man. Just how did this once high-flying prince of a Chinese business empire known for publicly flaunting his lavish lifestyle get into his current predicament?
It started four years ago with his startup Panda TV.
Before it came to an abrupt end in March, Panda TV was one of the most popular live-streaming services in China, a country with an estimated audience of more than 450 million people.
Right from the start, Panda TV hired a star-studded team of esports players to host shows on the platform. But the Shanghai-based company failed to keep up as the industry became more competitive.
As streaming platforms Douyu and Huya grew to dominate the game live-streaming market, Panda TV struggled to raise fresh funds to keep operations going. High bandwidth costs and rising salaries for streamers were attributed as major reasons for the cash crunch, and the company eventually went bankrupt.
While the company didn’t go out of business until this year, there were earlier signs Panda TV was in trouble. In December 2018, Cao Yue, a streamer who used to work for the platform, won a lawsuit against the company for failing to pay her 3.6 million yuan (US$512,000).
After Panda TV failed to comply with the ruling, a Shanghai court placed a spending limit on Wang last month, limiting his daily spending to necessities. Shortly after that, Prometheus Capital came out with a statement acknowledging that Panda TV’s collapse was the reason for Wang’s financial plight.
In the statement, the company asks for the public’s understanding, saying, “[Wang] still has many other investments. We can’t flatout negate all that he’s done with the ups and downs of one single project. No one can be sure all his investments can lead to success.”
Days after the statement was issued, Wang was released from the spending ban. But soon, another lawsuit related to Panda TV surfaced. This time the motion came from an investment company with a 2.31% stake in Panda TV owner Shanghai Panda Entertainment. This resulted in Wang getting hit with another spending limit in Beijing.
Wang initially founded Panda TV with half a billion yuan he got from his father. In the company’s early days, Wang was personally involved. But his edgy vision for Panda TV was met with major resistance from the government. His variety show Hello! Goddess was banned for being too vulgar. Another variety show -- The Smart Show -- was canceled after a few episodes for undisclosed reasons.
Wang’s bold experiments were enabled by his success in raising funds early on, but his luck ran out in May 2017. For the next 22 months, Panda TV had trouble raising fresh funds while competitors like Huya and Douyu secured major funding from Chinese tech giant Tencent.
Wang also reportedly lost some control over Panda TV in 2018 when he sold a substantial number of shares to Zhou Hongyi, CEO of Chinese internet security company Qihoo 360. By the end of that year, Wang and Zhou were said to both owned about 30% of Panda TV.
Amid the string of bad news, though, some relief has come for Wang. Prometheus Capital recently won a case against Leshi, another debt-saddled Chinese tech conglomerate. It was ruled that Leshi had to buy back some of its shares owned by Prometheus Capital.
And at the end of the day, Wang’s 151 million yuan debt may not be a debilitating amount for the son of a real estate mogul. The elder Wang has previously said he would rescue his son’s failed ventures twice before giving up. It remains to be seen if he’s going to step in to help now.