IPO In China: Made-In-China.com President Joseph Wong (Part 7)

SM: Why did you list in China instead of Hong Kong?

JW: The main decision was made by the CEO and CFO. Since I did not make the decision directly, I cannot say what were the final reasons for choosing the Chinese markets over the Hong Kong markets. It is my understanding that one of the main reasons we did not list in Hong Kong is because the majority of our income originates from Chinese customers.

When we listed in China, it was a great promotion and branding for our customers as well as for our own company. It was not a typical listing and it gained a lot of attention, so it potentially introduced us to new exporters and manufacturers as well. Additionally, the Chinese government poses some restrictions on companies in China that want to go public outside of China. Since we listed within China, we did not have to deal with any of the extra restrictions of requirements.

SM: You are a scare commodity as an Internet stock on the Chinese stock exchange. You must have done well at the IPO.

JW: The IPO was good. We got around 1.2 billion RMB, which is about $1.7 million. We received a lot of attention and demonstrated good success. It was good for other companies in China to get introduced to our services. It has been a good decision.

SM: That is a good multiple to raise. How do you intend to use the money?

JW: We are going to focus on hardware, software and service upgrades to Made-In-China.com. We are also going to set up new sales offices, research and development labs and a modern customer service center. We now also have the option to look at strategic investments or acquisitions.

SM: Are there companies that you can acquire?

JW: We will consider an acquisition if the company suits our development plan and helps our current service grow. Nothing to report there yet.

SM: What is your competitive landscape? Are there other companies in China who are trying to copy your business model?

JW: We have been a leading company the B2B business in China for over 10 years. During this time we have increased our membership base, web traffic and developed strong partnerships. There are companies that want to copy our model but have done so unsuccessfully. One example is Ninetowns which launched tootoo.com in 2006 but closed it in 2009.

SM: Looking forward, how much more growth can you realistically expect to obtain?

JW: We believe we can achieve 30% to 50% growth in the next few years. We will do so by focusing on expanding our online and offline services for both buyers and sellers. In the next five yers we would like our net profits to exceed $100M. We aim to be the undisputed, number one service provider of international trade services for online and offline business matching, supplier and product quality assurance, credit and insurance, and sourcing and logistics. As you can see we have plenty of room left for growth in all of those areas.

SM: Fantastic. Congratulations on your success to date.

This segment is part 7 in the series : IPO In China: Made-In-China.com President Joseph Wong
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