Chinese startup Xiaohongshu in talks to raise funds at $6b valuation

Tencent Holding Ltd

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

The online platform, backed by Tencent Holdings Ltd. and Alibaba Group Holding Ltd., aims to raise about $400 million to $500 million, said the people. The company 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. Its valuation reached about $5 billion last year, one person said.

There hasn’t been a final decision on the fundraising size as deliberations are still at an early stage, the people said. A representative for Xiaohongshu didn’t respond to requests for comment.

Xiaohongshu resumed seeking new funds following an earlier attempt that was suspended after its offering was taken down from app stores last year. The app has since returned and is available for downloads, with more than 300 million users as of July, according to its website.

Xiaohongshu — which calls itself RED and stresses its name bears no relation to the seminal book of Mao Zedong’s quotations — 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.

The startup closed a $300 million series D financing at a valuation more than $3 billion in 2018. The round was led by Alibaba and other investors including GSR Ventures and Tencent Investment.

Bloomberg

Singapore Reporter/s

In Singapore, we are looking to double our reporting team by this year-end to comprehensively cover the fast-moving world of funded startups and VC, PE & M&A deals. We want reporters who can tell our readers what is really happening in these sectors and why it matters to markets, companies and consumers. The ability to write precisely and urgently is crucial for these roles. Ideal candidates must have to ability to work in a collaborative, dynamic, and fast-changing environment. We want our new hires to be digitally savvy and ready to experiment with new forms of storytelling. Most importantly, we are looking for hard-hitting reporters who work well in a team. Collaboration and collegiality are a must.

Following vacancies can be applied for (only in Singapore).

Following vacancies can be applied for (only in Singapore).   

  • A reporter to track companies/startups that have raised private capital, and have the potential to become unicorns. SEA currently has over 40 companies with a valuation of over $100 million and under $1 billion.
  • A reporter who can get behind the scenes and reveal how funding rounds are put together, or why they’ve failed to materialise. She/he in this role will largely focus on long-format stories. 
  • A journalist to track special situations funds, distressed debt and private credit (from the PE angle) across Asia.

Singapore Reporter/s

In Singapore, we are looking to double our reporting team by this year-end to comprehensively cover the fast-moving world of funded startups and VC, PE & M&A deals. We want reporters who can tell our readers what is really happening in these sectors and why it matters to markets, companies and consumers. The ability to write precisely and urgently is crucial for these roles. Ideal candidates must have to ability to work in a collaborative, dynamic, and fast-changing environment. We want our new hires to be digitally savvy and ready to experiment with new forms of storytelling. Most importantly, we are looking for hard-hitting reporters who work well in a team. Collaboration and collegiality are a must.

Following vacancies can be applied for (only in Singapore).

Following vacancies can be applied for (only in Singapore).   

  • A reporter to track companies/startups that have raised private capital, and have the potential to become unicorns. SEA currently has over 40 companies with a valuation of over $100 million and under $1 billion.
  • A reporter who can get behind the scenes and reveal how funding rounds are put together, or why they’ve failed to materialise. She/he in this role will largely focus on long-format stories. 
  • A journalist to track special situations funds, distressed debt and private credit (from the PE angle) across Asia.