Chinese video player and online video provider Baofeng was listed on Shenzhen Growth Enterprise Market on March 24th, raising RMB510 million (US$82 million). Baofeng closed up 44% on its debut, increasing the company’s market cap to RMB1.23 billion.
Company founder Zhou Shengjun started Baofeng as a desktop video player in 2003, and soon the service became popular with Chinese users in the PC age.
Baofeng made several shifts in strategy and technology focus over the following years to keep up with the rapidly-evolving market. In 2008, it became a tool for streaming content from providers such as Youku, when video streaming becoming ubiquitous.
With the smart device craze, the company explored the virtual reality sector with the launch of a budget VR handset last year. In combination with its video services, the VR business will be Baofeng’s key direction in the future, said company CEO Feng Xin at the IPO listing ceremony this week.
The 12-year-old company has more than 50 million daily active users and over 200 million active users per month, Feng noted.
Unlike other online video services, Baofeng has been recording profits, mainly from advertising, premium subscriptions and gaming. According to its IPO prospectus, the firm generated revenues of RMB386 million in 2014, up 18.92% from 2013 (RMB325 million). Net profit climbed 8.61% year-on-year to RMB41.85 million in 2014. Its clients include big names like Taobao, JD, Baidu, Yum!, amongst others.
Although the road to IPO is rarely smooth for any company, it’s fair to say that Baofeng’s journey has been one of the bumpier ones. The Beijing-headquartered firm has filed for IPO twice, once on the U.S. stock market in 2011 and the other one on Shenzhen GEB in 2012, before achieving the milestone this week.
Editing by Mike Cormack (@bucketoftongues)