Kuaishou Has Become One Of The Fastest Growing Chinese Online Shopping Platform
Most of the short video sharing apps such as TikTok, Trillers, and Douyin, among others have monetized their app with the advertisement of the products and services. However, Kuaishou, a Chinese mobile app, has expanded its monetization efforts by becoming one of the fastest growing online shopping platforms.
On Wednesday, Kuaishou announced that it has crossed the mark of 500 Million online shopping orders in August. The mobile app started as a GIF generator in 2011 while it changed its business model in 2012 by providing a platform for users to create short videos. Currently, it’ striving to become the eminent online shopping platform in China with an effort to compete against JD.com, Pinduodu, and Alibaba.
According to the company, it has more than 100 Million daily active users for its e-commerce services. Recently, Kuaishou announced that it’s launching a project to help more than 100,000 new businesses and generate sales of more than 1 Million Yuan (approximately USD 146,000) on its platform in 2021. In June 2020, the company also announced that it will be investing 3 Billion Yuan (approximately USD 424 Million) to build an e-commerce headquarters in Chengdu, China. The coronavirus crisis has persuaded the merchants to move online which has escalated the online business across the globe.
The Tencent Holding backed company is preparing for an initial public offering (IPO) and also aiming to raise up to USD 5 Billion in Hong Kong IPO, Reuters reported, citing the person familiar with the matter. Kuaishou is targeting the valuation of USD 50 Billion. It has hired Bank of America and investment bank company China Renaissance for the IPO. Reuters reported that it’s going to the file for the IPO by the end of October.
Meanwhile, Kuaishou is not the only one who’s planning for IPO. The Chinese fintech company Ant Group is preparing to raise around USD 30 Billion in a dual listing in Hong Kong and Shanghai in October. This IPO debut can set to become the world’s largest IPO ever. ByteDance, the parent company of TikTok, has reportedly shelved its plans for global IPO but would continue listings its domestic business in Hong Kong or Shanghai. Currently, TikTok is facing severe scrutiny from the U.S. over national security concerns and has been already banned in India.
TikTok’s position in the U.S. has been in jeopardy as the Trump Administration has forced them to dissect their assets in the country. Recently, Microsoft and Oracle were the frontrunners in the race to buy the company’s U.S. operations. However, ByteDance rejected Microsoft’s deal and went into a partnership with Oracle.
The Chinese company Tencent Holdings had invested around USD 2 Billion in 2019 while the video-sharing app company raised around USD 3 Billion during the same time which leveled up its valuation up to USD 29 Billion. Along with Tencent Holdings, the U.S. fund Sequoia Capital, Jack Ma-backed private equity firm Yungfeng Capital, and Singapore sovereign fund Temasek Holdings have been the investors in the company. According to researchers at CBNData, the Kuaishou app has over 430 Million monthly active users as of June 2020.