The company is backed by Tencent and Alibaba, and it wants to raise somewhere between $400 million and $500 million. It’s teamed up with a financial plan adviser to identify possible investors. Last year, it was valued at $5 billion.
The app was temporarily removed from app stores last year, and its fundraising attempts were suspended. However, it’s back now and has over 300 million users, as of July. The company calls itself RED and makes a point to mention that it’s not affiliated with the popular book by Mao Zedong of the same name.
It was started in 2013 as a community online that would recommend eCommerce sites outside of China. It eventually entered that field itself, and then it became a social media platform. Users of the platform share videos and pictures on topics like travel, food and skincare.
RED closed a $300 million series D round in 2018 and had a valuation of $3 billion. Tencent and Alibaba both invested in that round.
In other Tencent news, the company recently said it would start researching cryptocurrency and how it would factor into blockchain. Chinese media reported that Tencent told its staff that the new research arm is going to be responsible for moving the needle on digital payments using blockchain.
Tencent has come under scrutiny for the way it deals with user information, and China recently asked it to clean up its policies.
In fact, China found that 41 apps in the country were not complying with user data rules, regulators said recently, and that the apps improperly collected information about visitors.
China has the largest amount of internet users in the world, with more than 800 million online in the country.