Maimai, LinkedIn’s biggest China rival, raises US$750m in funding and aims for 2019 IPO

Maimai.cn, China’s biggest rival to global professional networking giant LinkedIn, has secured US$750 million in a latest funding round from US top tech investors DCM Ventures and IDG Capital, and is now targeting an initial public offering (IPO) in 2019.

The Chinese networking site aimed particularly at business people, now claims to be just about neck and neck with LinkedIn in terms of users in China, as competition in the world’s largest labour market intensifies.

The funding round was led by California-based DCM, with IDG Capital and Hong Kong’s Morningside Venture Capital also taking part as investors. Zhilian Zhaopin, a Chinese job recruitment site, also agreed to become a strategic investor.

“The completion of this Series C funding round signals the company has entered a stage of rapid development. Our target is to sign up all the employees from China’s top 500 Chinese companies and top 500 global companies operating in the country,” said Lin Fan, Maimai’s founder and chief executive officer.

He said the company plans to use the funds to expand into other markets and improve its service offerings.

“We want to go public in 2019, with a target market value of US$10 billion,” Lin said.

“As China transforms from an acquaintance society to a society of strangers, Maimai is set to play a more important role based on its products and user base,” said Ramon Zeng, general partner of DCM Ventures, meaning traditional communities are increasingly being replaced by social network-led groups of individuals.

“We are optimistic about the growth potential of professional networking.”

Established only in 2013, Maimai claims to have 30 million registered users in China, with 10 million monthly active users, and broke even financially for the first time last year.

In February, Lin said in an interview with People’s Daily, that 80 per cent of Maimai’s revenue comes from advertising, and the rest from premium customer subscriptions, including corporate users.

LinkedIn, which is owned by Microsoft, generated some US$1.1 billion in annual revenue this financial year, but it is far less dependent on advertising income.

Maimai’s main features include individual and group chat rooms, news feeds, a referral system, anonymous messaging, nicknamed “office gossip”.

That anonymous workplace function is currently its most active, the company said, and its users are mainly involved in internet-related businesses and the financial services sector.

LinkedIn still claims to be the world’s largest professional network, recently saying it now has 36 million registered users in the mainland, an eightfold increase since first entering the market in 2014.

The firm, however, recently ran into difficulties with Chinese regulators, after increased scrutiny on its jobs postings policies.

The jobs and networking service had reportedly been forced to block some individuals from advertising jobs on its site in China, after contravening new Chinese rules with requires it to verify individual identities, according to an article in The New York Times last week.

LinkedIn said in a statement that companies can still list job postings, while it remains unclear when it will allow individuals to start reusing the function.

In June, Derek Shen, the president of LinkedIn China, resigned allegedly after falling short of its original goal of reaching 140 million professional users in China. He had headed the division for more than three years.

In April, Chinese market research firm iResearch actually ranked Maimai ahead of LinkedIn for the first time in the rankings of China’s most popular social networking apps.

The research firm compiles the monthly list based on the number of unique devices on which the app was used.