China media platform Lizhi pursues US listing
Lizhi, a Guangzhou-based audio streaming and social networking platform backed by Matrix Partners China and Morningside Venture Capital, has filed for a US IPO.
According to a filing, Matrix is the largest institutional shareholder with a 21.9% interest, while Morningside holds 21.5%. The company is estimated to have raised about $80 million to date, including a staged Series D round in 2017 that brought in at least $33.6 million.
Matrix backed the Series A, B, and C rounds during 2011-2014, while Morningside contributed to the Series B and C round starting in 2012. Shunwei Capital Partners is also an investor, according to AVCJ Research.
The core product is a mobile app that allows users to create and distribute original content as well as interact with each other in real-time. It is claimed to be the largest user-generated audio community in China with about 47 million monthly active users and 71% market share in the interactive audio entertainment segment.
“We envision a global audio community – a place where everyone can become a host, record their lives, share stories, and empathize and connect with each other, through voices and across cultures,” the company said.
Lizhi is a division of Guangzhou Lizhi Network, which also operates Zuzuche, a car rental service that has received investment from Matrix and China Creation Ventures among others. Lizhi’s main competitor is Shanghai-based audio streaming platform Ximalaya, which has been valued at $3.5 billion on the back of support from the likes of General Atlantic, Goldman Sachs, and Tencent Holdings, as well as China Creation.
Revenue improved 76% during 2018 to RMB798.6 million ($113.4 million) with Lizhi citing an increase in virtual gift sales in relation to its audio entertainment products, as well as increases in the number of audio entertainment paying users and income related to podcast advertising. Net loss narrowed during the year from RMB153.7 million to RMB9.4 million.
Proceeds from the IPO will be used to develop new products and technology, including artificial intelligence, and expand overseas. In July, Lizhi launched a locally tailored version of its audio entertainment product in the Middle East and North Africa. It is also planning an entry into Southeast Asia.
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