China-based short-form video app and ByteDance rival Kuaishou is close to completing a $3 billion-pre-IPO funding round.
Tencent is reportedly negotiating a $2bn lead investment, the terms of which will close this month.
That’s all according to Chinese business news outlet LatePost, which reports that following this latest round of funding, Kuaishou will have a pre-IPO valuation of $28.6bn, and that Tencent will own 20% of the company.
The report names additional investors as Sequoia Capital, Boyu Capital, Alibaba’s Jack Ma-backed Yunfeng and Temasek.
Kuaishou was launched in 2011 by Su Hua, CEO and founder of Kuaishou Technology.
It now has more than 200 million daily active users, supported by an archive of 13 billion original short videos.
According to Kuaishou, 19m users earned income through advertisement, live-streaming video, e-commerce and ‘knowledge payments’ via the app in the past year, with 5m of those users from poverty-stricken regions in China.
The global version of the app is called Kwai, which has 700m registered users worldwide.
Analytics firm Sensor Tower reported in August that Kuaishou was the second highest earning app worldwide (behind YouTube) in the Photo & Video category for Q2 2019, with around $78 million in gross revenues. Around 99% of Kuaishou’s revenue was from China.
TechCrunch originally reported in February 2017 that the company was planning to go public by the end of that year, with Tencent then leading a $350m investment in the app the following month (March 2017).
Tencent then led a $1bn funding round in January 2018, which valued the company, at that time, at approximately $18bn.
In September this year, citing people familiar with the matter, Bloomberg reported that Kuaishou was considering a US IPO in 2020 in order to fund its growth in the short-form video space and to compete with TikTok parent company ByteDance.Music Business Worldwide