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| DangDang |
| US$27,000,000 |
Private Placement
Financial Advisor
June 2006 |
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Company Description
E-Commerce China Co. Ltd. (“Dangdang.com”) is the largest online retailer in China.
The Company provides more than 260,000 titles of BMVD (“books, music, video and DVD”) and 30,000 other products including consumer electronics, gifts, baby items, home appliances, etc. Dangdang.com was the first online bookstore in China, opening in November 1999.
Situation
As a leading e-commerce company in China, Dangdang was planning an IPO in the U.S. in 2008. The Company wanted to raise a pre-IPO round to fund business expansion and attract top-tier U.S. institutional investors. Despite its market position, the Company had not been profitable, therefore creating significant challenges for valuation. The founders wanted to minimize dilution to maintain their ownership in the Company.
Entrepreneur Profile
Mr. Guoqing Li and Ms. Peggy Yu, founders and co-presidents of Dangdang, founded Dangdang in 1999. Prior to founding Dangdang, Mr. Li founded Science & Culture Group in 1993, which publishes textbook supplements, business education, and medical books through co-publishing agreements with various state-owned publishing houses. Ms. Yu worked at a number of MNCs in China and the U.S. including Babcock & Wilcox, UPS, and Garick Corporation. She also founded Tripod International, a financial advisory firm in 1992.
China Renaissance Solution
China Renaissance carefully crafted the marketing program with an emphasis on the potential of the Chinese e-commerce market and conducted an auction that attracted a large number of tier-one VCs and strategic investors. The transaction was a success with a final valuation 50% higher than the initial pricing range. We successfully closed the $27 mm Series C financing with leading VCs including DCM.
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