Bottom line: Homestay specialist Tujia could make a play to merge with the China operations of Airbnb, following its major new tie-up with leading online travel sites Ctrip and Qunar.
Ctrip ties with Tujia
Leading online travel agent Ctrip (Nasdaq: CTRP) is back to doing what it knows best, neutralizing competition through formation of savvy alliances with its rivals. In this case the company is taking aim at the market for short-term stays at private homes, with its announcement of a major new tie-up with homegrown industry leader Tujia. That alliance is seeing Ctrip merge its own homestay business with Tujia, in what looks like a clear shot at global leader and sector pioneer Airbnb. Read Full Post…
The following press releases and news reports about China companies were carried on October 21. To view a full article or story, click on the link next to the headline.
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China Mobile (HKEx: 941) Announces Financial Results for First 3 Quarters (HKEx announcement)
Homestay Business of Ctrip (Nasdaq: CTRP) and Qunar Acquired by Tujia (PRNewswire)
China iOS App Store Passes US in Sales to Become World’s Largest – Report (Chinese article)
Walmart (NYSE: WMT) Opens Flagship Store on JD.com (Nasdaq: JD) (Chinese article)
Giant Interactive to Buy Online Game Maker Playtika for 30.5 Bln Yuan (Chinese article)
The following press releases and news reports about China companies were carried on June 23. To view a full article or story, click on the link next to the headline.
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Alibaba (NYSE: BABA) Wins Dismissal of Lawsuit Over Pre-IPO Regulatory Warning (English article)
Baidu (Nasdaq: BIDU) Creates Own Indexes to Paint Picture of China’s Economy (English article)
Fresh Food B2B M-commerce App Meicai Raises $200 Mln Series D Funding (English article)
Tujia Acquires Mayi, Becomes China’s Largest Shared Room Listing Service (Chinese article)
Stock Exchange Queries LeEco (Shenzhen: 300104) on Big Inventory, Accounts Receivable Rises (Chinese article)
Bottom line: Airbnb should have a strong chance for success in China, thanks to its good choice of local partners, strong experience in its field and relatively little competition from homegrown rivals.
Airbnb hangs out China shingle
Not too many foreign Internet companies are coming into China these days, mostly due to the poor track record for previous big names. But that lackluster record of isn’t deterring online travel site Airbnb, which has been quite high-profile with a formal announcement of its entry to China.
The road into China is littered with cases of failure, with big names like Google (Nasdaq: GOOG), eBay (Nasdaq: EBAY), Yahoo (Nasdaq: YHOO) and Groupon (Nasdaq: GRPN) all entering the market at various times, only to withdraw later. In most cases companies failed to anticipate stiff competition, which was ready to use many tactics the big international names considered unacceptable. Failure to adapt to local tastes was also a factor, as many of these big names tried to use identical business models for China that they did in the west. Read Full Post…
Bottom line: Tujia’s new fund raising reflects strong investor confidence in its business model and market positioning, which could help the company to post strong growth before an IPO in the next 1-3 years.
Tujia raises $300 mln
It seems like hot Internet sites only need to say they’re looking for new money these days, and they can automatically attract big investor interest that allows them to raise huge funds and get lofty valuations. The latest company to follow the pattern is Tujia, a site that allows homeowners to rent out their vacant properties to travelers, using a similar model to popular US site Airbnb. Just a month after media reported that Tujia was finalizing a new funding round worth $250 million (previous post), the latest reports say demand was so strong that it ended up raising $300 million. Read Full Post…
Bottom line: New fund raising by Ctrip and Tujia looks like far more than either company needs, and is part of a broader wave seeing Chinese Internet sites raise big funds to take advantage of strong investor sentiment.
Tujia raises $250 mln
Someone recently asked me why so many companies in China are currently rushing to raise cash, and, after some quick thought, I provided my best answer: Because they can. That seems to be the mentality among Chinese companies these days, including leading online travel agent Ctrip (Nasdaq: CTRP), which has just issued bonds to raise a cool $1.1 billion in new cash that it really doesn’t need. But that statement isn’t completely true, as Ctrip is in another headline that has it joining in a new $250 million funding round for Tujia, China’s equivalent of Airbnb. Read Full Post…
The following press releases and media reports about Chinese companies were carried on June 19. To view a full article or story, click on the link next to the headline.
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Alibaba’s (NYSE: BABA) Ant Financial Valued at $45 Bln After New Funding: Source (English article)
Huawei to Make Nexus Smartphones for Google (Nasdaq: GOOG) – Employee (Chinese article)
Online travel is quickly taking on a new cult-like status among investors, with word of a major new funding for vacation rental site Tujia. This latest fund-raising frenzy in online travel looks very similar to what happened in group buying about 4 years ago, when investors pumped billions of dollars into a wide range of money-losing start-ups. Internet watchers will know that many of those companies later went bust, raising the prospect that a similar fate could be waiting for the online travel sector. Read Full Post…
The following press releases and media reports about Chinese companies were carried on June 19. To view a full article or story, click on the link next to the headline.
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Vacation Rental Site Tujia Completes $100 Mln Series C Funding (English article)
ZTE (HKEx: 763) Files Antitrust Complaint With European Commission Against Vringo (Businesswire)
Guangzhou Daily Withdraws Lawsuit Against Today’s Headlines App (Chinese article)
Huawei Expands In Russian Tech Services After Putin’s China Deal (English article)
Billionaire JD.com (Nasdaq: JD) Founder Lines Up Next Challenge: Beating Alibaba (English article)
