Success stories of startups and investors in them. Meitu and Sinovation Ventures

What made Meitu a strong investment was that the company was not just a copy of something American.

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total yield

The total is invested:

$15 million

Share in the company after the IPO:

Yield:

$200 million

4 000%

The 2016 IPO of Chinese photo editing app Meitu was Hong Kong's largest IPO in more than a decade. The company was valued at $4.9 billion and raised $630 million in a public offering. It has become

What made Meitu a strong investment was that the company was not just a copy of something American. An investor's fear of missing out (FOMO) typically leads to overinvestment in copies of successful companies in other markets. Having missed out on successes like Groupon in the US, investors go hunting for the perfect copy abroad - missing out on the local nuances needed for a product to take hold and become successful.

Meitu was not just a photo editing app; it managed to ride a completely unique synthesis of two huge trends in Chinese culture:

1 Mobile boom. Immediately after the launch of the Meitu mobile app, smartphone usage in China began to grow exponentially, providing organic fuel for growth;
2 Obsession with editing your appearance and plastic surgery. And at this moment, Meitu is expanding its photo retouching tools.

Copycat companies are simply copies of someone else's ideas, but companies with their own approach and in the context of the local market can actually implement these ideas. In the case of Meitu, we see a company that is focused on a specific local specificity.