The biggest game company in the world isn't Nintendo - it's a Chinese company that has a piece of everything from 'Fortnite' to 'League of Legends'

Nintendo spent several decades building up game franchises and characters from nothing, elevating a tiny Italian plumber from a few blocky pixels to a household name.

Tencent is taking a decidedly different tactic: Investing in, and/or buying up, major game makers.

For instance, Tencent outright owns Riot Games — the Los Angeles-based studio responsible for two of the world's biggest games: "League of Legends" and "Teamfight Tactics."

Tencent also owns a substantial portion of Epic Games (specifically, a 40% stake) — the North Carolina-based company behind "Fortnite," the Epic Games Store, and the software suite that powers a huge portion of gaming (Unreal Engine). It also owns the majority of Supercell (84%), the Finnish mobile gaming powerhouse behind "Clash of Clans," "Clash Royale," and "Brawl Stars."

And that's just for starters: Tencent also has minority stakes in "Call of Duty" publisher Activision and "Assassin's Creed" publisher Ubisoft.

Simply put: Tencent's gaming portfolio is massive.

Activision, the publisher behind "Call of Duty," is an American company. When Activision wants to bring "Call of Duty" to China, Activision needs a Chinese partner — and that partner is Tencent. Even Nintendo is going through Tencent to get in to China's lucrative gaming market: Nintendo and Tencent are teaming up to release the Switch in China at an undisclosed point in the future.

Apply that same process to the rest of the world's biggest game companies, from EA to Sony and Ubisoft, and you get the same result: Tencent is the company through which the video game industry accesses China.

And that's absolutely massive.

Moreover, Tencent operates WeGame — the Chinese equivalent of Steam, the world's largest PC gaming storefront. There's one major difference between Steam and WeGame: Tencent's version of Steam has far more users.

When Nintendo made the unfortunate choice to release its Wii U console, consumers responded with a resounding silence: The console is Nintendo's worst-selling in history.

The company's stock took a years-long hit, and analysts wondered if Nintendo had finally lost its mojo (it hadn't). That's largely because Nintendo is solely focused on being a video game company.

Tencent Games, however, is just one comparatively small component of Tencent's far larger footprint. It can take riskier bets and make bigger investments than Nintendo, and its failures have far less direct of an impact on the overall business.