China’s social commerce group discount platform Pinduoduo had its debut on the Nasdaq at 7 p.m. July 26 (Beijing time), and ended its first trading day with a stock price of $26.70, valuing the company at $29.6 billion.
The company projected its U.S. IPO price at $19 per share, with the expectation of raising $1.63 billion. After the debut day, Colin Huang, the founder of Pinduoduo holding 46.8 percent stake at $13.8 billion became a new billionaire and 13th richest person in China.
Pinduoduo, under the symbol PDD, was founded in 2015 and has now become the third-largest e-commerce platform in the country with more than 200 million monthly active users. Pinduoduo’s success is a result of the typical group purchase with discount concept combined with more social features.
“We believe WeChat accounts for the majority of buyer traffic, and Pinduoduo could not have built up its large user base cost-effectively and rapidly without WeChat,” wrote Arun George, a technology analyst. Online traffic derived from Tencent’s Wechat is believed to help direct more than 1 billion users to Pinduoduo.
In addition to the access point in Tencent’s Wechat super app, the pair also teamed up in areas such as payment processing, advertising and cloud technology.
With 5.2 percent of market share, Pinduoduo is lagging behind leaders Alibaba Group with 58.2 percent and JD.com with 16.3 percent, according to research data by eMarketer.
Colin Huang, also known by his Chinese name Huang Zheng, was trained as a data scientist and started his career at Google’s headquarters in 2004 as a software engineer then project manager. He was part of the team that established Google China.
This was also the first time that a U.S.- listed company had a bell-ringing ceremony in two cities – New York and Shanghai. Huang hosted the Shanghai event on Thursday evening local time.