As it prepares to go public, the Sina spinoff Weibo is pitching itself as a “mobile first” product with 70 percent of users accessing the social media service from phones and 22 percent of total revenue in 2013 from mobile advertising.
Weibo is hoping to raise $437 million in a Nasdaq listing, according to a filing yesterday.
Weibo has 143.8 million monthly active users, with $188.3 million of revenue for a loss of $38.1 million in 2013.
Though Weibo is perhaps a little too old — it started in 2009 — to be a true mobile-only product, mobile is one of the stronger stories the company is telling. Weibo has been hurt in the past year by challenges to user growth including competition from Tencent’s mobile messaging service WeChat (though Weibo still serves a need as more of a public tool), as well as rising government censorship, including arrests of prominent Weibo personalities like investor Charles Xue, which was perceived by many as a form of government intimidation of critics.
The company said in its filing that growth has also been hurt by recent government identity verification requirements.
According to the Financial Times, Weibo has halved expectations of its valuation in recent months, with rumored numbers of $7 billion to $8 billion now reduced to $3.9 billion in Friday’s filing.
But perhaps mobile is Weibo’s bright spot, especially as other social media companies like Facebook and Twitter have found they can please the public markets by addressing it.
“Designed with a ‘mobile first’ philosophy, Weibo displays content in a simple information feed format,” said the SEC filing. “With a limit of 140 Chinese characters per feed, the high information-density of Chinese characters and users’ ability to personalize content information flow, Weibo is particularly suited for mobile use, and we have seen significant mobile adoption.”
Further, Weibo said, “In the fourth quarter of 2013, we had over 120 million check-ins where users recorded their location by using a mobile device to post their location in a feed on Weibo.”
And Weibo CEO Gaofei Wang, appointed in February 2014, is a mobile guy. He was in Sina’s mobile division for the past decade, and has been general manager of Weibo since 2012.
Another happy sign is Alibaba, the Chinese e-commerce star that’s also expected to go public soon. In April 2013, Alibaba bought an 18 percent stake of Weibo for $585.8 million. Last month Alibaba told Weibo it would exercise its option to increase that stake to 32 percent of the company.
Alibaba also just contributed $215 million to a massive new round for U.S.-based mobile communication company Tango.
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