in photo-obsessed asia, cai Wensheng’s image-editing apps have become megahits— without a flicker of a real business model.
“WE ARE BASICALLY No. 1 in this industry,” says Cai Wensheng, the 46-year-old cofounder of popular appmaker Meitu, delivering his boast from an art-filled four-story villa in China’s southeastern Fujian Province. “We have seen no less than 100 competitors, but they all come in second.”
To the victor go the spoils: Cai is worth an estimated $1.3 billion with reportedly at least a 35% stake in Meitu, creator of 14 Photoshop-like apps. It has raised over $360 million from investors such as Foxconn and Tiger Global Management, and its apps attract more than 360 million active monthly users. The selfie reigns supreme in Asia, where shutterbugs obsess over unblemished images even more than Americans do.
Cai was a high school dropout who sold cosmetics and handbags in the Fujian countryside before founding a wangzhi daohang— a Web directory of sorts—that sold to Google in 2007 for $20 million. He and a partner, the more design-focused Wu Xinhong, started Meitu in 2008. It has been a hit, but can it actually make a profit in photo apps? So far, Cai has eschewed advertising for fear that it will turn off his loyal users.
He wants Meitu to move into e-commerce and games soon, though he doesn’t offer precise details. For revenue, the company relies largely on its line of smartphones, of which it has sold some 200,000 a year since 2013, an analyst says. (China’s Xiaomi sold 70 million handsets last year.) One selling point of the Meitu smartphone: It’s a supersize gadget with a frontfacing 21-megapixel camera—intended, naturally, for selfie fanatics.