Xiaomi, VC-backed Chinese wearables maker targets US IPO

The filing gives no indication of the size or timing of the offering. It does reveal that Shunwei Capital Partners – a venture capital firm set up by Lei Jun, a serial entrepreneur who also founded Xiaomi – has a 20.4% stake in Huami, while Xiaomi itself and Banyan Capital Partners hold 19.3% and 9.7%, respectively. Wang Huang, the company’s co-founder, chairman and CEO has 39.4%.

Banyan led a $35 million Series B round of funding for Huami in December 2014 at a valuation of approximately $300 million. Sequoia Capital China, Morningside Ventures, and Shunwei also participated. According to the filing, total Series A and B shares issued to these investors, and also to Xiaomi, total $40.6 million.

Huami claims to have shipped 45.3 million smart wearable devices since its inception in 2013. Shipments in the first nine months of 2017 totaled 11.6 million units, more than any other company in the world, according to a Frost & Sullivan report. It distributes fitness trackers under Xiaomi’s Mi Band brand as well as its own brand, Amazfit.

Revenue reached RMB1.56 billion ($233.6 million) in 2016, up from RMB896.5 million the previous year, with sales of Xiaomi products accounting for more than 90% of the total. Over the same period, Huami moved from a net loss of RMB37.9 million to a net profit of RMB23.9 million.

Xiaomi has reportedly selected investment banks to run an IPO that could value the business at as much as $100 billion. It last raised equity funding in late 2014 at a valuation of $45 billion. Smart phone sales then slowed as the likes of Huawei, Oppo and Vivo released competing devices. With its private market valuation having fallen, Xiaomi raised $1 billion in debt funding last year.

The company is said to have responded to the competitive threat through global expansion and building an offline retail network. Xiaomi has also cultivated an investment portfolio with a view to building a technology ecosystem around its core products. It has invested in at least 20 hardware start-ups, ranging from wearables to air purifier manufacturers, and helps them sell products through the Xiaomi platform.

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• Topics
• Greater China
• IPO
• Technology
• China
• Venture
• Xiaomi
• Shunwei Capital Partners
• Banyan Capital