What happened: Popular sports commentary app Hupu has disappeared from major Android stores as well as Apple’s China App Store.Its parent company Hupu also runs a website with sports-related news and other content, as well as an e-commerce app called Shihuo.As of Monday morning, Shihuo was still listed on various app stores.However, posts on the official WeChat account of Hupu’s flagship app have been deleted.The company has not yet commented on the takedown.Why it’s important: Offerings such as live text commentary on NBA games have grown the popularity of Hupu’s app.
WeChat Pay to reportedly take on Google Pay and Paytm in India later this year – The Next WebWhat happened: Tencent is eyeing the increasingly saturated payment market in India with a UPI-based (Unified Payments Interface) WeChat Pay app.Tencent executives met with the National Payment Corporation of India (NPCI) to discuss obtaining a license, according to Indian internet media Entrackr.The Chinese tech giant is reportedly planning to launch the payment service as early as May or June.Why it’s important: The UPI payment system’s monthly transaction volume on average exceeds Rs.1 trillion ($14.47 billion) over the past three months, according to NPCI statistics.
Alibaba Buys Israeli AR Startup Amid China Investment Scrutiny – BloombergWhat happened: Chinese e-commerce giant Alibaba has acquired Israel augmented reality company InfinityAR, the companies announced on Sunday.Neither disclosed financial details of the deal, but Alibaba could pay more than $10 million, according to an estimate from the market source cited by Globes.In 2016, Alibaba together with Japanese company Sun has invested $15 million and $3 million respectively for a combined 22% share of the startup.Why it’s important: Alibaba has been picking up the augmented reality (AR) and virtual reality (VR) boom since 2016, when the rise of AR and VR was in full swing.In addition to InfinityAR, Alibaba led $800 million investment in Magic Leap that year.
A Didi driver has allegedly been murdered by a passenger in the central Chinese city of Changde, once again drawing attention to safety standards on the ride-hailing platform.The incident occurred early Sunday morning when a 19-year-old suspect stabbed the driver, surnamed Chen, before disembarking, according to law enforcement in the city.Police said that the suspect turned himself in shortly after committing the crime.“We have formed an emergency response team to fully cooperate with police while sending representatives to visit the family of the vicitim,” Didi said in a Weibo announcement (in Chinese).A Didi spokesperson told TechNode that the driver worked for the company’s Express service.The incident follows Didi’s increased focus on safety after it experienced public outcry and government censure after two passengers were killed by their drivers on separate occasions last year.
China Tech Investor is a weekly look at China’s tech companies through the lens of investment.Each week, hosts Elliott Zaagman and James Hull go through their watch list of publicly listed tech companies and also interview experts on issues affecting the macroeconomy and the stock prices of China’s tech companies.Make sure you don’t miss anything.Check out our lineup of China tech podcasts.In this episode of the China Tech Investor Podcast powered by TechNode, hosts Elliott Zaagman and James Hull discuss live streaming, Pinduoduo’s results and cash flow conundrum and Meituan’s 2018 performance.Michael Norris joins to share his insights on the companies we follow and his article “Growing in a mature market: Six directions for China’s tech giants”.
Video-conferencing company Zoom files to go public with over $300 million in revenue — and it’s even profitable – CNBCWhat happened: Zoom, the startup offering an affordable, easy to use video conferencing service, filed for IPO on Friday.Founded in 2011 by former WebEx engineer Eric Yuan, Zoom posted a net positive income in the fiscal year ending on Jan. 31 following a $1 billion valuation in 2017.It will look to raise $100 million upon listing on the NASDAQ under the ZM symbol, and joins a host of other tech startups such as Lyft, Pinterest and Airbnb also making preparations to go public.Why it’s important: Despite its relative youth, Zoom has held up against larger competitors like Microsoft, Google and even Cisco, which purchased WebEx for $3.2 billion in 2007.And while its current conferencing service is oriented toward the enterprise and education sectors, founder and CEO Eric Yuan mentioned in a recent conversation with GGV Capital that the company is looking into creating a consumer-focused version of its product, which could compete more squarely with the likes of Skype and Google Hangouts.
Logistics startup Delhivery has secured over US$400 million in a financing round led by the SoftBank Vision Fund, the company said.This round, which saw the participation of existing investors Carlyle and Fosun, will see the valuation of the company shoot up to over US$1.5 billionThe company claims to have 65 percent CAGR growth since FY15 with almost one in four packages ordered online in India going through Delhivery’s network, accounting for more than 500,000 parcels daily and over 450 million transactions since its inception.
Alibaba, Tencent, Suning, and car makers including Chongqing Changan Automobile have set up a US$1.5 billion Chinese ride-hailing venture, a move that could test the dominance of ride-sharing giant Didi Chuxing.China is home to the world’s largest ride-hailing market, estimated by consulting firm Bain & Co to be worth US$23 billion.Of that, Didi Chuxing takes 90 percent of all bookings.
Chinese automaker Changan has tied up with internet giants Tencent and Alibaba to form a RMB 10 billion ($1.45 billion) joint venture to invest in the country’s mobility sector.Changan’s RMB 1.6 billion investment in the Nanjing-based company, tentatively dubbed Lingxing, gives the automaker just over 16% control of the newly established firm.State-owned First Automotive Works (FAW) and Dongfeng Motor plan to contribute the same amount.Meanwhile, Chinese internet giants Tencent and Alibaba will spend RMB 2.25 billion together with three investment companies, while retail conglomerate Suning’s investment totals RMB 1.7 billion.Lingxing will establish a mobility firm, which aims to be “the most reliable shared mobility service enterprise” and focus on the deployment of connected new energy vehicles, Changan said in an announcement.Tencent and Alibaba declined to comment when contacted by TechNode.
Tencent plays catch-up in cloud computing services as video gaming business slows – SCMPWhat happened: Chinese tech tycoon Tencent announced it would increase investment in its cloud computing business at a press conference held Thursday.Retail, financial services, transport, healthcare, and education are among the primary industries to which Tencent will provide its customized cloud computing service.Tencent expects the cloud computing operations to be a new revenue source for the company, as well as a point to connect the consumer and industrial internet, according to its founder Pony Ma.Why it’s important: The rivalry between Tencent and its long-term competitor Alibaba in the cloud computing industry is heating up as both companies are seeking new growth narratives in enterprise-facing businesses.Tencent launched an organizational overhaul in late September 2018 to send a strong signal that it was taking enterprise seriously, and cloud is the most important part of this shift.
China’s three major telecommunications network operators are cautious about investments in 5G infrastructure, as revealed by the companies’ 2018 annual results.The combined spending of China Mobile, China Unicom, and China Telecom is expected to reach RMB 286 billion (around $43 billion) in 2019, while their aggregate investment in 5G is estimated to be less than RMB 34 billion.The numbers show that the three giants of China’s telecom industry are cautious about their investments in 5G, given that the country is determined to become the world leader in 5G technologies and roll out 5G for commercial use in 2020.By comparison, the total investments will need to reach RMB 1.23 trillion in order to build China’s 5G networks, according to China Securities International.China Mobile said that the company would continue to conduct 5G network tests and perform trials on business applications to ensure the pre-commercial launch of 5G services this year.The company plans to spend the most among the three operators in 2019, with a capital expenditure of RMB 149.9 billion.
They have 113 million more active buyers on an annual basis than JD.com and grew revenue 652% last year.This is measured by a figure called free cash flow, a measure of the cash produced that is free to be used by the firm for whatever they want.Pinduoduo announced 2018 results on March 13, and at first glance it looks like Pinduoduo is producing tons of cash: “net cash provided by operating activities” was over RMB 7.7 billion (about $1.15 billion).Pinduoduo’s most recent press release does not give the components of net cash from operating activities, so I need to go back to their Form F-1 filed on June 29, 2018.According to “Note 2: Summary of Significant Accounting Policies” in Pinduoduo’s IPO prospectus: “Restricted cash represents cash received from consumers and reserved in a bank supervised account for payments to merchants.” Restricted cash is not freely usable and therefore should be excluded from free cash flow.Payables to merchants appear to arise when a customer orders a product, pays for it, and the cash is held in an account waiting to be paid to the merchant.
“In my opinion, money is just a tool,” says Yosuke Tsuji, co-founder of Japanese fintech software-as-a-service (SaaS) company Money Forward.“Our goal [is] for everyone to enjoy their lives.[We hope] that people don’t have to think about money,” he adds.This is what motivated Tsuji to set up the company, where he serves as CEO, president, and representative director.Launched in 2012, Money Forward has built personal financial management (PFM) apps that allow people to track their money, plan their financial future, and optimize their spending, savings, and investments.Meanwhile, its cloud services for enterprises let companies streamline their back-office and accounting services, as well as their business-to-business-to-customer (B2B2C) cloud offerings.
Chinese social e-commerce platform Yunji files for a $200 million US IPO– NasdaqWhat happened: Chinese social e-commerce platform Yunji on Thursday filed for a $200 million US initial public offering.Founded in 2015, the services achieved rapid growth by leveraging the huge user base of social platforms like WeChat as a source for potential buyers.The company claimed to have 7.4 million members as of December 2018 and a gross merchandise volume of almost RMB 23 billion (around $3.5 billion) in 2018.The retail app covers a variety of Chinese and international brands and includes products like groceries, cosmetics, and electronics.Why it’s important: China’s social e-commerce industry has experienced robust growth and commanded an increasing share of the overall online retail industry over the past few years.
More than 500 individuals have been arrested for using Didi’s ride-hailing platform for fraudulent activity and personal data theft.In a work report released Thursday on WeChat (in Chinese), Didi confirmed Chinese police apprehended suspects in 25 cases during 2018, the latest in a series of measures to ensure compliance on its platform.The perpetrators allegedly took advantage of a system that Didi uses to pay its drivers prior to receiving payment from customers.The suspects registered for Didi user accounts with fake payment credentials.They then posted ads online offering Didi trips at reduced prices.Internet users respond to their postings and paid the fraudsters for the trip, though no money ever reached Didi.
Bitmain Set to Deploy $80 Million Worth of Bitcoin Miners, Sources Say – CoinDeskWhat happened: Chinese cryptocurrency mining giant Bitmain is reportedly planning to deploy up to 200,000 units of mining equipment in China, according to mining farm operators who are familiar with the plan.Bitmain has reportedly been in talks and started making deals with mining farms in China’s southwestern provinces to host the mining equipment.The company is reportedly looking to benefit from the low-cost hydroelectric power in the region during the summer.The deployment is conservatively estimated to cost between $80 million and $100 million.Why it’s important: The decision to scale up its mining capability comes a few months after the mining giant shuttered a number of its overseas offices, including those in Israel and Amsterdam, amid the crypto market slump last year.
Indonesian fintech startup Akulaku has invested IDR 500 billion (US$35.3 million) to acquire a minority stake in Bank Yudha Bhakti, an Indonesian bank.“This is a new kind of deal because no technology company and traditional bank have worked together the way we have,” said Akulaku CEO William Li.Akulaku’s investment will increase the bank’s offerings for digital banking services and other forms of financial technology, Li explained.It also gives Akulaku access to traditional financial services that are normally restricted to banks.
What happened: A supply chain executive of Huawei’s television segment told Chinese media Jiemian that the company would release its rumored Huawei TV next month, which could possibly be equipped with dual cameras, along with gaming and social media features.The executive also said that Huawei TV aims to sell 10 million units each year, which would make up 20% of China’s TV market.In addition to consumer devices, Huawei would also branch out into the commercial TV market, said him.Why it’s important: The rise of 5G technology has sparked a trend whereby smartphone makers move into the TV business.Analysts said Huawei’s television plan aims to create more entry points into future 5G-powered internet of things scenarios by establishing a smart home system.Meanwhile, Shenzhen-based smartphone manufacturer OnePlus announced in September that it had decided to enter the smart TV market, and expects to release its first 4K Ultra HD TV in 2019.
TikTok Has Made $75 Million So Far from In-App Purchases on the App Store and Google Play – Sensor TowerWhat happened: TikTok and Douyin have brought in an estimated $75 million (around RMB 500 million) through in-app sales of virtual coins, according to mobile app intelligence firm Sensor Tower.TikTok users in the US contributed the most to the sales, purchasing close to $41.3 million worth of coins, or 55% of the global total.About 23% of the revenue came from China’s iOS users, who use the app’s Chinese version, Douyin.The figure doesn’t include revenue from China’s third-party Android stores.Both TikTok and Douyin users can purchase virtual coins and use them to exchange gifts that can be given to livestreamers.
Xiaomi Releases Short Video App – Yicai GlobalWhat happened: Following in the footsteps of Bytedance and Tencent, Chinese smartphone maker Xiaomi launched its own short video entertainment app.Zhenjing Video is operated by a company in the southwestern city of Chengdu, in which Xiaomi has a controlling stake.As of Thursday it was still available on Xiaomi and Baidu’s Android app stores but has since been taken down, although a WeChat mini-program by the same name remains live.The app hosted videos ranging from one minute to 10 minutes, plus features such as personalized content and ‘bullet screens’ for displaying comments.Users are currently unable to upload their own videos, however.