Chinese social networking site Kaixin001.com plans U.S. IPO next year

Posted: December 20th, 2010 | Tags: Caijing, Cheng Binghao, IPO, Kaixin001, Northern Light Venture Capital | 1 Comment »

Kaixin001.com (开心网), one of China’s leading social networking sites, plans to launch an initial public offering (IPO) in the U.S. next year, according to Chinese media.

The Chinese-language Caijing magazine reported last Friday that Kaixin001 (“Happy Net”) would float on an undisclosed U.S. stock exchange in 2011.

An unnamed Kaixin source told Caijing that proceeds from the IPO would go towards developing the firm’s advertising model as well as applications for its social networking platform.

Kaixin001 broke even in the second quarter (Q2) of this year and currently generates more than RMB 10 million (£962,000) in monthly net profit, according to its CEO and founder Cheng Binghao in the report.

Kaixin001’s revenue for 2010 is expected to total RMB 300 million (£28.88 million) with 80 percent generated by internet advertising. Value-added services and revenue sharing agreements will contribute the remainder, Caijing said.

Founded in 2008, Kaixin001 raised £3.2 million in its first round of funding from Hong Kong-based Northern Light Venture Capital in September the same year.

A number of large Chinese Internet firms have launched IPOs in the U.S. this year, most recently online video sharing company Youku.com on December 8.

Chinese IPOs in the U.S. hit a record high of 35 this year, accounting for 23 percent of U.S. market IPO activity, according to Reuters.