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November 01, 2011

China's Version of Groupon, LaShou, to Raise $100M in IPO

By Erin Harrison, Executive Editor, Strategic Initiatives

China’s popular daily deals website LaShou Group is hoping to raise as much as $100 million in its initial public offering to expand its delivery systems and marketing efforts, according to media reports. The company filed the necessary paperwork with the U.S. Securities and Exchange Commission on Oct. 28.



LaShou, which means “hand-in-hand” in Chinese, is an online social commerce company in China whose business model is similar to Groupon, where users are able to purchase discounted deals from retailers.

According to the SEC filing, the Beijing-based company enriches “the online shopping experience of consumers in China by offering attractive group-purchase discounts across a variety of services and products on our website, www.lashou.com, and create a new avenue for large numbers of local merchants in China to grow their businesses.”

The company also cites figures from iResearch, which has ranked LaShou No. 1 among independent online social commerce companies in China. The rankings are based on the number of daily unique visitors to online social commerce websites in China during the months of January 2011 through July 2011, with over 22 percent of total unique visitors viewing our website in each of these months, according to the company’s SEC (News - Alert) filing.

LaShou, which was launched in March 2010, offers users from up to 1,000 daily listings of mostly local offerings on substantially discounted services and products in more than 500 cities and towns.

As of Oct.23, LaShou’s cumulative merchant base had grown to approximately 46,000 merchants supported by over 3,100 sales personnel in 184 cities and towns across 31 provinces in China, Hong Kong and Macau, the SEC filing said.

But analysts say that China’s e-commerce sector is saturated with over 1,000 other similar discount websites.

“China’s group buying sector is intensely competitive and saturated with more than a thousand group buying websites and LaShou faces an uphill battle to win a lion’s share,” according to analysts, Reuters (News - Alert) reported.

“E-commerce in China is hyper competitive, much more than the U.S., and if any sector stands out as highest risk for lowest return, then it is group buying,” Michael Clendenin, managing director at Shanghai-based consultancy RedTech Advisors told Reuters.


Erin Harrison is Executive Editor, Strategic Initiatives, for TMC, where she oversees the company's strategic editorial initiatives, including the launch of several new print and online initiatives. She plays an active role in the print publications and TMCnet, covering IP communications, information technology and other related topics. To read more of Erin's articles, please visit her columnist page.

Edited by Jennifer Russell
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