Cross-border e-commerce player Wish files for US IPO

The company's most recent private funding round, which closed in August 2019, was at a valuation of $11.2 billion. That round – the Series H – generated proceeds of $160 million plus the right to invest a further $150 million.

General Atlantic was the lead investor and holds 3.8% of Wish's Class A shares. It also owns a smaller number of Class B shares, which have an equal equity value but a larger voting interest. Founder and CEO Peter Szulczewski retains control of the business through his Class B share interest.

DST Global is the largest external investor with 24.1% of the Class A shares. According to AVCJ Research's records, it led a $500 million round – that also featured JD.com – in 2015. Formation 8, Founders Fund, GGV Capital and Legend Capital together invested $50 million a year earlier, while Temasek Holdings made a solo commitment of $500 million a year later.

Other investors are said to include CEL Venture Capital, Third Point Ventures, and the Everbright-IDG Industrial Fund. None of these are mentioned in the prospectus.

Szulczewski, a former Google employee, founded Wish in 2010. The company claims to connect more than 100 million monthly active users (MAUs) in 100 countries to 500,000 merchants offering approximately 150 million items. It was the most downloaded global shopping app in each of the last three years. Wish facilitated the shipment of 640 million items in the 12 months ended September.

The business model was built on helping Chinese merchants access global consumers, but efforts have been made to diversify the merchant base in recent years. Though China still dominates, four out of the top 10 selling merchants on the platform in 2019 were located in the US. The company has also developed a network of 50,000 Wish Local stores in 50 countries. These are run by third parties that sell their own inventory via Wish and serve as pickup points for all online orders.

Wish is targeting a global mobile commerce market that was worth $2.1 trillion last year and is expected to reach $4.5 trillion by 2024. However, it focuses on affordability and accessibility, claiming that most consumers cannot afford typical e-commerce product offerings.

Revenue reached $1.9 billion in 2019, up from $1.7 billion a year earlier. Over the same period, the net loss narrowed from $208 million to $128 million, with sales and marketing accounting for most of the costs. However, Wish is cash flow positive, having generated $16 million in cumulative cash flow from operations between January 2017 and September 2020.

Most of the company's revenue comes from commissions on sales, but it has introduced an advertising feature whereby merchants can pay to promote their listings within user feeds. In terms of geography, Europe and North America accounted for 85% of marketplace revenue – a near 50-50 split – in the nine months ended September.

• Tweet  
• Facebook  
• LinkedIn  
• Google plus  
• Save this article  
• Send to  

• Topics
• Greater China
• North America
• IPO
• Consumer
• Technology
• Europe
• China
• USA
• TMT
• GGV Capital
• General Atlantic
• Temasek Holdings
• DST Advisors
• Formation 8