Douyu, a China-based livestreaming platform developer backed by internet group Tencent, filed to raise up to $500m in an initial public offering in the US yesterday.
Founded in 2014, Douyu runs an online platform with approximately 153 million monthly active users that focuses on the live streaming of online games and eSports events. It almost doubled revenue to more than $531m in 2018, though its net loss rose 43% to $126m.
The company intends to put the IPO proceeds into beefing up its eSports content and expanding the range of content it streams. It also plans to strengthen its marketing and fund research and development in areas like big data and user experience.
The offering will come after almost $1.1bn in funding, according to the IPO filing, which reveals reports of Douyu’s earlier financing involved figures different to the sums it actually raised.
Venture capital firm Sequoia China invested $17.3m in the company in 2014, before joining Tencent, Nanshan Capital and, reportedly, game developer Zeus Interactive for a 2016 series B round revealed by the IPO filing to be $73.7m in size.
Douyu added $166m in a series C round featuring Tencent, Shenzhen Capital Group and China’s National SME Development Fund later the same year.
The company received $72m from unnamed investors in November 2017, before Tencent provided approximately $631m in funding in March 2018. Sequoia China invested a further $197m in the company two months later.
Tencent is Douyu’s largest shareholder, with a 40.1% stake, followed by founder and CEO Shaojie Chen (14.1%), Sequoia China (9.8%), a vehicle known as Aodong Investments (8.9%), an entity called Douyu Employees (7%) and a vehicle called Phoenix Fuju (6%).
Morgan Stanley, JP Morgan Securities and Merrill Lynch are the underwriters for the offering, which is slated to take place on the New York Stock Exchange.
