China’s Instagram Gets Ready to Go Public

Summary

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Big Take – “China’s Instagram Gets Ready to Go Public”

Date: June 23, 2026
Host: Wan Ha (Bloomberg Reporter/Host)
Featured Guest: Robert Li (Bloomberg Intelligence Analyst)

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Episode Overview

This episode of The Big Take Asia delves into the imminent IPO of Xiaohongshu (known internationally as Rednote or “China’s Instagram”), its competitive edge in China’s tech sector, and what its public offering signals for Hong Kong, global investors, and the future direction of China’s digital economy. The episode features in-depth analysis from Bloomberg Intelligence’s Robert Li, exploring Xiaohongshu’s unique user base, financials, and strategic timing in going public.

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Key Discussion Points and Insights

The TikTok Crisis and Xiaohongshu’s International Moment

• In 2023, with TikTok facing potential bans in the US, many Americans, in search of alternatives, flocked to Xiaohongshu.
  • Wan Ha [01:42]: “Back then, TikTok was about to be banned in the US... Many of them landed on Xiao Hongshu.”
  • Despite the TikTok ban delay and its eventual spin-off/survival in the US, Xiaohongshu retained a global curiosity and stayed part of Wan Ha’s reporting and personal travel planning routines.

Xiaohongshu’s Business Model and User Base

• Xiaohongshu began as a travel recommendation site but is now China’s dominant lifestyle platform, driven by young, predominantly female users in affluent Chinese cities.
  • Robert Li [03:44]: “It's got... probably close to 400 million active users, mainly within the borders of China itself.”
  • Its core differentiator is “authenticity and a much, much lower reliance on these paid KOLs.”
• Key user stats:
  • 64% female, 34% under 25 years old [06:16].
  • These “female internet users hold higher monthly spending power... and spend slightly more time online, close to six hours a day” [07:13, Wan Ha].
  • High ad conversion rates, especially in beauty and health [07:13].

Societal Context: Consumption as Escapism

• Xiaohongshu’s rise aligns with economic pressures on China’s youth:
  • High housing prices and a tough job market mean young people seek affordable ways to “cheer themselves up” [08:21].
  • Robert Li [08:54]: “We all need a little bit of that. But it just so happens that Xiaohongshu is directly targeting that demographic with a big focus on these lifestyle products.”

Financial Performance and Monetization Moves

• Xiaohongshu is believed to be profitable, with unconfirmed estimates placing net profit around US$3 billion, though there’s no published financial data [09:11].
• It has captured advertising dollars from rivals like Weibo and is transitioning toward a closed-loop e-commerce system:
  • Goal: “consumers can discover a product and buy it all without leaving the app” [10:13].
  • This approach leverages the platform’s trusted community and authentic reviews.
• International Expansion: Launched “Redshop” in 2026, allowing US, UK, Australia, and select Asian markets to buy directly from Xiaohongshu merchants [11:17].

Strategic Partnerships & E-commerce Ecosystem

• Xiaohongshu partners with e-commerce giants (Taobao, JD.com, Pinduoduo) on fulfillment, focusing on artisanal, small-ticket items and steering clear of direct competition in electronics or high-value goods [11:46].

The IPO in Context

• Timing: Hong Kong’s IPO market has rebounded, with $20 billion raised so far in 2026; Chinese tech and AI listings fuel the momentum [04:53].
  • Robert Li [05:23]: “This is an IPO... which could actually go down really well. It will be a breath of fresh air.”
• Valuation: Estimates for Xiaohongshu’s value range from US$30 to US$50 billion based on recent funding rounds; potentially aiming higher [16:39].
  • For comparison, Jupu AI, much smaller and unprofitable, hit a US$100 billion valuation after IPO [16:39].
• Hong Kong as Venue:
  • Regulatory crackdowns and geopolitics have made US listings difficult.
  • Hong Kong enables mainland investors to participate and is “China’s window on the world” [17:52].
  • Robert Li [18:58]: “Hong Kong is back... IPO market is really rampant. There are so many companies looking to come to market still... also that China is open to the world and China is a true innovator.”

The Bigger Picture: China’s Economic Strategy

• The Chinese government is actively pivoting away from overheating real estate and infrastructure to “new productive forces” — innovation, high-tech, and digital platforms [20:00].
• IPOs like Xiaohongshu’s serve dual goals:
  1. Raise capital for continued tech growth.
  2. Enhance global perceptions of Chinese innovation.
  • Robert Li [20:00]: “China is looking to the high tech sector as a future driver of GDP growth... looking really solidly to the high tech sector… or as the government often terms it, new productive forces.”

Global Capital Flows and Appetite for China Tech

• Despite US funds’ hesitation due to geopolitical risks, attractive Chinese listings at a discount to Nasdaq multiples continues to draw international capital [20:56].
  • Robert Li [21:57]: “Every stock market lives or dies on the new companies coming to market.”
  • High-quality Chinese IPOs can “redress the balance and bring new life to the market, perhaps new blood coming in” [21:57].

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Notable Quotes & Memorable Moments

• On Xiaohongshu’s Niche:
  • “It has an authenticity and a much, much lower reliance on these paid KOLs... carved out a significant niche on the Chinese social media scene, a sector which is intensely competitive.”
    — Robert Li [04:07]
• On Youth Trends:
  • “You want to try and cheer yourself up. You want to focus on the things that make you happy.”
    — Robert Li [08:21]
• On Hong Kong’s IPO Rebound:
  • “Hong Kong is back... China is open to the world and China is a true innovator.”
    — Robert Li [18:58]
• On Broader Economic Shift:
  • “China is looking to the high tech sector as a future driver of GDP growth... looking really solidly to the high tech sector as a future of economic growth or as the government often terms it, new productive forces.”
    — Robert Li [20:00]
• On Global Perspective:
  • “Every stock market lives or dies on the new companies coming to market.”
    — Robert Li [21:57]

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Important Timestamps

• [01:42] – Wan Ha describes the initial TikTok user migration to Xiaohongshu.
• [03:44] – Robert Li outlines Xiaohongshu’s current user base size.
• [06:16] – Discussion of Xiaohongshu’s evolution and core demographic.
• [07:13] – Insights on users’ purchasing power and time spent online.
• [08:21] – Robert Li on the economic struggles shaping youth consumption.
• [10:13] – E-commerce ambitions: closed-loop system and global expansion.
• [11:46] – Xiaohongshu’s partnerships with China’s e-commerce giants.
• [16:39] – Valuation discussion and comparisons with AI IPOs.
• [17:52] – Why Hong Kong is the right IPO venue.
• [18:58] – Hong Kong’s resurgence as a listing destination.
• [20:00] – Context: China’s economic pivot to high tech.
• [21:57] – The importance of new IPOs in rejuvenating markets.

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Conclusion

The episode frames Xiaohongshu’s planned IPO as a critical signal for China’s tech sector resilience and Hong Kong’s return as an IPO hub. Xiaohongshu’s appeal to young, spend-happy consumers and its platform authenticity make it attractive to advertisers—and by extension, to investors. While regulatory and geopolitical issues complicate overseas listings for Chinese tech, robust demand, innovation, and the draw of global capital all converge in Hong Kong. As Robert Li sums it up: “Every stock market lives or dies on the new companies coming to market” [21:57].

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Transcript

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[Microsoft Representative]

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[Bloomberg Audio Studios Announcer]

Bloomberg Audio Studios Podcasts Radio

[News Segment Host]

News

[Wan Ha (Bloomberg Reporter/Host)]

early last year, I downloaded Xiaohongshu, the Chinese social media app known internationally as Rednode. Back then, TikTok was about to be banned in the US and fears that it would shut down for good sent millions of mostly Americans looking for alternatives. Many of them landed on Xiao Hongshu.

[Robert Li (Bloomberg Intelligence Analyst)]

Hello everybody, we're from TikTok from America.

[Wan Ha (Bloomberg Reporter/Host)]

Posting my first video to RedNote as an American TikTok refugee.

[Robert Li (Bloomberg Intelligence Analyst)]

Hello everybody.

[Wan Ha (Bloomberg Reporter/Host)]

And we covered the Xiaohongshu craze on the big Tick Asia at the time. But not long after we reported the story, President Trump announced he would delay the ban on TikTok. He ended up delaying it several times, and most of the Americans who'd migrated from TikTok to Sha Hongshu went right back. And in January of this year, by day, TikTok's parent company in China agreed to spin off its US operations, securing TikTok's future in the States.

[Robert Li (Bloomberg Intelligence Analyst)]

TikTok is saved.

[Wan Ha (Bloomberg Reporter/Host)]

Well, it's official, President Trump just announced a US buyer for TikTok. But the Xiaohongshu app stayed on my phone, and pretty quickly it became a part of My routine when I'm not hosting the show. I cover tourism for Bloomberg and use Xiaohongshu to look for story ideas and even help me plan trips. Is day 7 out of 10 of

[Bloomberg Audio Studios Announcer]

my road trip around New Zealand.

[Wan Ha (Bloomberg Reporter/Host)]

So I wanted to answer some of

[Bloomberg Audio Studios Announcer]

the most commonly asked questions or work

[Wan Ha (Bloomberg Reporter/Host)]

on my tennis game.

[Microsoft Representative]

Okay, so today we're going to look

[Robert Li (Bloomberg Intelligence Analyst)]

at a two hand backhand slice. So it's more like this Chow Hong Shu. Many people compare it to Instagram or Reddit, but really it's become the de facto search engine for mainly younger people who are looking for travel tips, lifestyle hacks, restaurant recommendations, that sort of thing.

[Wan Ha (Bloomberg Reporter/Host)]

Robert Li leads the coverage of China's tech sector for Bloomberg Intelligence, the company's research arm. He doesn't use the app himself, but he has been tracking its rise.

[Robert Li (Bloomberg Intelligence Analyst)]

So at the last count, it's got, in fact, probably close to 400 million active users, mainly within the borders of China itself.

[Wan Ha (Bloomberg Reporter/Host)]

That's smaller than other Chinese social media apps like WeChat, which has roughly 1.4 billion users. But Rob says investors are keenly interested in Xiaohongshu because it offers users something different from the competition.

[Robert Li (Bloomberg Intelligence Analyst)]

It has an authenticity and a much, much lower reliance on these paid kols, as they call them in China, or key opinion leaders. These are the influencers of China. They've certainly carved out a significant niche on the Chinese social media scene, a sector which is intensely competitive.

[Wan Ha (Bloomberg Reporter/Host)]

And now, after more than a decade building its brand, Xiao Hong Xu wants to turn that niche into a significant market share.

[Bank of America Announcer]

No, right.

[Wan Ha (Bloomberg Reporter/Host)]

Shao Hong Xu said to be preparing

[Bloomberg Audio Studios Announcer]

for an IPO in Hong Kong by the end of June.

[Wan Ha (Bloomberg Reporter/Host)]

Let's bring in.

[Robert Li (Bloomberg Intelligence Analyst)]

Once you've got that captive user base and once they're using it very actively, there is scope to monetize in other avenues. 400 million users is great, but there's significant scope to expand that.

[Wan Ha (Bloomberg Reporter/Host)]

One reason Xiao Hongshu might be eyeing a listing right now is timing. Hong Kong's IPO market has been on a tear. Companies have raised about $20 billion so far this year, and it's on track to hit a six year high. A lot of that momentum is coming from Chinese tech and AI companies hitting the market. But Rob says xiaohongshu, with its loyal user base and healthy profit margins, could stand out from the pack if it goes public.

[Robert Li (Bloomberg Intelligence Analyst)]

If you look at the broader China tech sector, it's a sector that's really been plagued by issues of oversupply. We don't have the numbers on Shaohongshu at the moment, but but it's not exposed to any of those negatives. And I think this is an ipo, Famous last words. Which could actually go down really well. It will be a breath of fresh air.

[Wan Ha (Bloomberg Reporter/Host)]

This is the Big Take Asia from Bloomberg News. I'm Wan Ha. Every week we take you inside some of the world's biggest and most powerful economies in the markets, tycoons and businesses that drive this ever shifting region. Today on the show, Xiaohongxu's push to go public why now could be the right moment and what it says about confidence in China's tech sector. Rob, what is Xiaohongshu and how are people using it?

[Robert Li (Bloomberg Intelligence Analyst)]

So the business was founded in 2013 more as a travel recommendation site, something similar to the along the lines of TripAdvisor as it was. But it's since evolved into, I'd say China's leading lifestyle orientated platform with a big influence on travel and lifestyle hacks and recommendations. And it's very well positioned again with this younger, predominantly female demographic in China, particularly as well within the more affluent population in the Tier one cities. So largely the big coastal cities and other southern regions and eastern regions of China. Within that demographic, it's a ubiquitous part of daily life and something people very actively use and rely on. Around 64% of their users are female and a further 34% were below the ages of 25.

[Wan Ha (Bloomberg Reporter/Host)]

China's female Internet users are an in demand demographic because they hold higher monthly spending power than the overall online population. That's according to research published by Bloomberg Intelligence. Female users also spend slightly more time online, close to six hours a day, logging 174 hours a month. That's compared to 169 hours for men. And Xiaohongxu isn't just good at driving clicks, it's good at turning them into sales. Xiaohongxu's ad conversion rates in 2024 beat competitors across several sectors, including beauty and health.

[Robert Li (Bloomberg Intelligence Analyst)]

We're not talking about purchases costing thousands of dollars. It's these sort of relatively small ticket items I think that are being sold. So yeah, from an advertising point of view, this is a really attractive demographic to try and tap into.

[Wan Ha (Bloomberg Reporter/Host)]

Rob says. One of the reasons the app's able to capture the attention and wallets of these young people is ironically because that sector of the population is struggling right now.

[Robert Li (Bloomberg Intelligence Analyst)]

Many countries in the world feature very high housing prices at the moment. So unless you have a wealthy family behind you or you're in a very wealthy job or you've saved up big deposit, it's quite hard to get on the housing ladder. And also the job market for younger people is quite tough at the moment. And then we've got, you know, all this external stuff, whether it's global warming, the conflict in Iran, etc. There's perhaps a lack of good news or whatever. You want to try and cheer yourself up. You want to focus on the things that make you happy.

[Wan Ha (Bloomberg Reporter/Host)]

So the cheer me up sales purchases.

[Robert Li (Bloomberg Intelligence Analyst)]

Exactly. Now we all need a little bit of that. But it just so happens that Xiao Hongshu is directly targeting that demographic with a big focus on these lifestyle products.

[Wan Ha (Bloomberg Reporter/Host)]

Let's talk a bit about their financials. What do we know about how they're doing as a company?

[Robert Li (Bloomberg Intelligence Analyst)]

This is a big unknown because there are no published quarterly results or annual report. So based on best estimates, and I stress this as unconfirmed sources, I think the company was due to generate net profit of around US$3 billion. But I think the results speak for themselves anyway in terms of their growing presence on the Chinese social media scene. The way that we can monitor that indirectly is looking at more traditional platforms like a Weibo. So Weibo has been around for decades. Xiaohongxu has captured advertising dollars. It's been at the expense of more traditional platforms like Weibo and if at their financial performance over the last few years it's just flatlined and in fact it's declining.

[News Segment Host]

Weibo.

[Wan Ha (Bloomberg Reporter/Host)]

Yeah, because of Xiaohengxu.

[Robert Li (Bloomberg Intelligence Analyst)]

I would say that was one reason. Probably also by Dance's Douyin platform as well. Advertisers are going to spend their dollars where consumers eyeballs are. So it's not on these legacy platforms, it's on growth platforms like xiaohongshu.

[Wan Ha (Bloomberg Reporter/Host)]

Xiaohongshu is good at keeping people scrolling, but it wants to be more than just a recommendation engine Right now if users see something they like, they buy things on xiahuangshu or on third party sites. But the goal is what Rob calls a closed loop e commerce system where consumers can discover a product and buy it all without leaving the app.

[Robert Li (Bloomberg Intelligence Analyst)]

Most Internet businesses or social media businesses in China are mostly reliant on advertising to generate their revenue. If we look at the textbook of the generic Internet model, you want to capture your user base. I've just stressed the fact that the authenticity of their reviews, the trusted nature of their community is key. Obviously from a corporate point of view, that opens up opportunities to monetize. So the company is pushing into e commerce, not to compete head to head with the likes of Alibaba etc. But really to try to recommend related purchases to what the individual is particularly interested in.

[Wan Ha (Bloomberg Reporter/Host)]

And this month, Xiaoangshu is expanding its e commerce push overseas. It launched a shopping feature called Redshop in its app. Consumers in the U.S. uK and Australia, as well as a handful of Asian countries are now able to buy directly from some Sha Wangshu merchants. And to what extent are they working with e commerce platforms like Taobao or JD.com, or Pinduoduo as well as some of the brands out there?

[Robert Li (Bloomberg Intelligence Analyst)]

Xiaohongxu is partnering with them on the fulfillment side. The infrastructure is already there. It's a make or buy decision. And given their greater focus on smaller ticket items, more artisanal products, they're not competing head to head. I mean, JD.com for example, does dominate electronics purchases online in China and much bigger ticket items. Xiaohongxu is not competing in that marketplace.

[Wan Ha (Bloomberg Reporter/Host)]

How does Sha Hongshu fit into the China tech landscape at the moment?

[Robert Li (Bloomberg Intelligence Analyst)]

For those who look at the China market? Well, you know, tech is all the rage these days and particularly AI. But if you look at the broader China tech sector, even though Chinese companies are making good progress, you know there's oversupply in the industry and that's impacting profitability. There's also been a number of vicious price wars, particularly in the E commerce sector. So that has really and without exaggerating, decimated the profitability companies like you've already mentioned, Pinduoduo or Alibaba and JD.com has put enormous pressure on them. So I think again, we don't have the numbers on Shaohongshu at the moment, but it's not exposed to any of those negatives.

[Wan Ha (Bloomberg Reporter/Host)]

What Shaoeng Xu's IPO could mean for Hong Kong global investors and confidence in China's tech sector. That's after the break.

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Shaohengzhou is gearing up for its next chapter, a potential IPO in Hong Kong with a confidential filing that could happen as soon as the end of June. The company, based in Shanghai, is backed by tech giants Tencent and Alibaba, and Bloomberg reported the listing could rank among Hong Kong's largest in recent years. Rob how big do we think this could be in terms of this Shaohongshu ipo? What's their valuation now?

[Robert Li (Bloomberg Intelligence Analyst)]

It's very difficult again for us to place a valuation on it because we don't have full access to financials and we're only going on unconfirmed reports of the recent fundraising rounds.

[Wan Ha (Bloomberg Reporter/Host)]

That's Robert Lee from Bloomberg Intelligence.

[Robert Li (Bloomberg Intelligence Analyst)]

I think one of the rounds last year went at a valuation of US$30 billion. Unconfirmed. The more recent round place the valuation of US$50 billion. But I imagine if this company really has momentum behind it and it's coming to market at the moment, they undoubtedly will be seeking a higher valuation than that. And again, if you look at two smaller AI plays which are far, far smaller than this company and heavily loss making, this is Jupu AI and also Minimax, which since their IPO in January, have gone up multiples. I think at the last count, Jupu AI's valuation is around US$100 billion, which is phenomenal for a company that will lose around $600 million operating loss in the current financial year. So there's a lot of hope being placed in that business at the moment. Now Xiaohongxi is profitable, it's tangible, but at the end of the day, it's up for the market to decide.

[Wan Ha (Bloomberg Reporter/Host)]

Now, there were reports that Shao Angshu had confidentially filed for a US IPO back in 2021, but the process failed after Chinese regulators voiced concerns about the listing venue in the us why is Hong Kong the right place?

[Robert Li (Bloomberg Intelligence Analyst)]

Now, this is a Chinese company. The vast bulk of their users are in within mainland China. Hong Kong's part of China and also Hong Kong is China's window on the world, if you like. So therefore it gives an opportunity for Hong Kong based investors and then also through the stock connect, allowing mainland Chinese investors to participate and also for foreign investors. So on that basis, it would seem the ideal place to seek a listing. And then you're right as well. I think it's less likely that we're going to see mainland Chinese companies listing in international markets, given the backdrop of geopolitics at the moment.

[Wan Ha (Bloomberg Reporter/Host)]

Back in 2020, Beijing cracked down on Chinese tech and later tightened rules around overseas listings, citing data security and capital outflow concerns for companies like Shaohongshu. That's left Hong Kong as one of the main viable options to go public. And that's helped drive a bit of a rebound with listings in the city picking up, led largely by Chinese tech and AI firms.

[Robert Li (Bloomberg Intelligence Analyst)]

Hong Kong is back. After all the challenges we've had in recent years, the IPO market is really rampant. There are so many companies looking to come to market still. It's been, you know, if you're in a broking industry, it should have been a pretty good 12, 18 months. So I think it's very strong signaling for Hong Kong itself and also that China is open to the world and China is a true innovator. Because I suppose if we'd had this conversation 15 or 20 years ago, I think most people would have said, you know, China's good at manufacturing things, but a lot of their products are a little bit copycat. They're not that great at innovation, they're maybe good at reverse engineering, and I think maybe there was some truth in that. But increasingly, Chinese companies, for various reasons, are truly innovating, particularly within the software space.

[Wan Ha (Bloomberg Reporter/Host)]

Rob says when you step back, this all ties into a much bigger story about China's economic strategy and its push into advanced tech.

[Robert Li (Bloomberg Intelligence Analyst)]

If you look at the overall government strategy, China is looking to the high tech sector as a future driver of GDP growth. And this is for economy which is historically over the last 20 years, been very dependent on fixed asset investment, very dependent on the property markets. So it's looking to diversify the economy, move away from those traditional drivers of economic growth to upskill the population, and looking really solidly to the high tech sector as a future of economic growth or as the government often terms it, new productive forces. So therefore that will require capital. And whilst China has got massive foreign currency reserves and others, it still requires external capital.

[Wan Ha (Bloomberg Reporter/Host)]

Rob, the US has made it more difficult for Chinese companies to list in the States. Are international investors then bringing their money this way?

[Robert Li (Bloomberg Intelligence Analyst)]

There was talk that a number of big US funds were instruction internally not to add to their China positions, really because of internal decisions, but also the geopolitical backdrop. At the end of the day, what are active fund managers there? They're there to generate a return for their shareholders, for their pension holders, for their unitholders, and I think at the end of the day, money talks. I think if there are enough attractive Chinese companies coming to market with attractive growth stories that are appropriately priced because you look at the multiples that companies are trading on out here versus nasdaq, it is a significant discount then that will attract capital flows into the Hong Kong and China market. Despite the politics, Xiao Yong Xu's IPO

[Wan Ha (Bloomberg Reporter/Host)]

is obviously a big story here for Hong Kong and China. If it proceeds, why do you think, or how do you think this matters for the rest of the world, for American investors, for London investors?

[Robert Li (Bloomberg Intelligence Analyst)]

I think there are high quality names here. But given the predominance of challenges across the sector at the moment, price wars, oversupply, etc. Again, for a market which has substantially underperformed globally and regionally, with interesting companies like shangshu coming to market, I think can hopefully redress the balance and bring new life to the market, perhaps new blood coming in. But the end of the day, every stock market lives or dies on the new companies coming to market.

[News Segment Host]

Foreign.

[Wan Ha (Bloomberg Reporter/Host)]

This is the Big Take Asia from Bloomberg News. I'm Juan Ha. To get more from the Big Take and unlimited access to all of bloomberg.com, subscribe [e-mail] podcastoffer if you liked the episode, make sure to subscribe and review the BigTick Asia. Wherever you listen to podcasts, it really helps people find the show. Thanks for listening. See you next time.

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