Tencent and Alibaba-backed “Xiaohongshu(小紅書)” seeks US$6 billion valuation

China’s social media and e-commerce start-up Xiaohongshu, or “Little Red Book”(小紅書), is in early talks to raise funds at a valuation of about US$6 billion, according to people familiar with the matter.

The online platform,backed by Tencent Holdings(騰訊) and Alibaba Group Holding(阿里巴巴), aims to raise about US$400 million to US$500 million, the people said.

Xiaohongshu(小紅書) is working with an adviser on the financing plan and has sounded out potential investors, said the people, who asked not to be identified as the discussions are private. The start-up’s valuation reached about US$5 billion last year, one person said.

There has not been a final decision on the fundraising size as deliberations are still at an early stage, the people said. A representative for Xiaohongshu(小紅書) did not respond to requests for comment.

Since returned and is available for downloads, Xiaohongshu(小紅書) has more than 300 million users and 200 million active users as of July, 2019 according to its website.

Xiaohongshu(小紅書) was founded in 2013 as an online community that recommends overseas e-commerce sites for users in China. It later entered e-commerce and then evolved into a social media platform, where users share their daily life moments through videos and pictures on topics including skincare, food and travel.

Xiaohongshu(小紅書) is the Most Powerful Consumable Platform in China because:

• It has the most consumable users, of which 70% are women.

• It uses a large number of KOLs / influencers(網紅) to share your products and increase your company / product awareness.

• It has mass traffic.

• It is suitable for: merchants (Small Merchants, SMEs, Service Industry, Retail Industry, Catering Industry).

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