Daojia, a Chinese platform offering on-demand housekeeping services, filed for an initial public offering in New York on July 2. In Chinese, Daojia means coming to homes.
Why it matters: The IPO application comes as Chinese regulators increase scrutiny of Chinese tech companies that collect extensive data from Chinese users and seek US IPOs.
- The platform offers a mobile app that helps people find domestic workers and book housekeeping services such as cleaning, cooking, and appliance repairs. Users can find and compare detailed information of the maids and service workers on the platform, including their age, appearance, hometown, experience, and personality.
Details: Daojia said it plans to go public on the New York Stock Exchange, but did not disclose the date of the listing and price range of its IPO, according to a prospectus filed to the US Securities and Exchange Commission (SEC).
- The company reported sustained revenue growth from 2018 to 2020. Revenue was RMB 398.7 million (around $61.7 million), RMB 611.1 million, and RMB 711.1 million, respectively.
- Daojia has operated on widening losses, which expanded from RMB 591.2 million to RMB 614.7 million from 2018 to 2020. The company said it might see “further losses as we continue to grow our business.”
- The company has applied to list under the ticker “JIA.”
Context: The Chinese government recently announced a series of investigations to examine potential data-security risks posed by Chinese tech firms listing in the US. Since July 2, China’s cyberspace regulator has launched investigations into Chinese ride-hailing giant Didi, transport companies Huo Chebang and Yun Manman, and job recruitment platform Boss Zhiping. All went public in the US in June.
- Daojia’s prospectus also cited China’s tightening data-security regulations as one of its risk factors. The company could face “severe penalties or be forced to relinquish our interests” in some operations should they be found violating Chinese regulations, said the filing.
- Daojia is owned by China’s largest online classifieds marketplace 58.com and backed by e-commerce behemoth Alibaba.