{"id":22860,"date":"2023-12-04T23:56:00","date_gmt":"2023-12-04T15:56:00","guid":{"rendered":"https:\/\/www.granitefirm.com\/blog\/us\/?p=22860"},"modified":"2025-10-29T11:14:09","modified_gmt":"2025-10-29T03:14:09","slug":"pinduoduo","status":"publish","type":"post","link":"https:\/\/www.granitefirm.com\/blog\/us\/2023\/12\/04\/pinduoduo\/","title":{"rendered":"How does Pinduoduo make money, why it surpass Alibaba and become No. valuable listed Chinese companies in US?"},"content":{"rendered":"\n<div id=\"ez-toc-container\" class=\"ez-toc-v2_0_82_2 counter-hierarchy ez-toc-counter ez-toc-custom ez-toc-container-direction\">\n<div class=\"ez-toc-title-container\">\n<p class=\"ez-toc-title\" style=\"cursor:inherit\">Table of Contents<\/p>\n<span class=\"ez-toc-title-toggle\"><a href=\"#\" class=\"ez-toc-pull-right ez-toc-btn ez-toc-btn-xs ez-toc-btn-default ez-toc-toggle\" aria-label=\"Toggle Table of Content\"><span class=\"ez-toc-js-icon-con\"><span class=\"\"><span class=\"eztoc-hide\" style=\"display:none;\">Toggle<\/span><span class=\"ez-toc-icon-toggle-span\"><svg style=\"fill: #ffffff;color:#ffffff\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" class=\"list-377408\" width=\"20px\" height=\"20px\" viewBox=\"0 0 24 24\" fill=\"none\"><path d=\"M6 6H4v2h2V6zm14 0H8v2h12V6zM4 11h2v2H4v-2zm16 0H8v2h12v-2zM4 16h2v2H4v-2zm16 0H8v2h12v-2z\" fill=\"currentColor\"><\/path><\/svg><svg style=\"fill: #ffffff;color:#ffffff\" class=\"arrow-unsorted-368013\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" width=\"10px\" height=\"10px\" viewBox=\"0 0 24 24\" version=\"1.2\" baseProfile=\"tiny\"><path d=\"M18.2 9.3l-6.2-6.3-6.2 6.3c-.2.2-.3.4-.3.7s.1.5.3.7c.2.2.4.3.7.3h11c.3 0 .5-.1.7-.3.2-.2.3-.5.3-.7s-.1-.5-.3-.7zM5.8 14.7l6.2 6.3 6.2-6.3c.2-.2.3-.5.3-.7s-.1-.5-.3-.7c-.2-.2-.4-.3-.7-.3h-11c-.3 0-.5.1-.7.3-.2.2-.3.5-.3.7s.1.5.3.7z\"\/><\/svg><\/span><\/span><\/span><\/a><\/span><\/div>\n<nav><ul class='ez-toc-list ez-toc-list-level-1 ' ><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-1\" href=\"https:\/\/www.granitefirm.com\/blog\/us\/2023\/12\/04\/pinduoduo\/#Pinduoduo_related_content_in_my_books\" >Pinduoduo related content in my books<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-2\" href=\"https:\/\/www.granitefirm.com\/blog\/us\/2023\/12\/04\/pinduoduo\/#Introduction\" >Introduction<\/a><ul class='ez-toc-list-level-3' ><li class='ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-3\" href=\"https:\/\/www.granitefirm.com\/blog\/us\/2023\/12\/04\/pinduoduo\/#Founder\" >Founder<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-4\" href=\"https:\/\/www.granitefirm.com\/blog\/us\/2023\/12\/04\/pinduoduo\/#The_history_of_Pinduoduo\" >The history of Pinduoduo<\/a><ul class='ez-toc-list-level-4' ><li class='ez-toc-heading-level-4'><a class=\"ez-toc-link ez-toc-heading-5\" href=\"https:\/\/www.granitefirm.com\/blog\/us\/2023\/12\/04\/pinduoduo\/#Oku\" >Oku<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-4'><a class=\"ez-toc-link ez-toc-heading-6\" href=\"https:\/\/www.granitefirm.com\/blog\/us\/2023\/12\/04\/pinduoduo\/#Leqee\" >Leqee<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-4'><a class=\"ez-toc-link ez-toc-heading-7\" href=\"https:\/\/www.granitefirm.com\/blog\/us\/2023\/12\/04\/pinduoduo\/#Xinyoudi_Studio\" >Xinyoudi Studio<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-4'><a class=\"ez-toc-link ez-toc-heading-8\" href=\"https:\/\/www.granitefirm.com\/blog\/us\/2023\/12\/04\/pinduoduo\/#PinHaoHuo\" >PinHaoHuo<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-4'><a class=\"ez-toc-link ez-toc-heading-9\" href=\"https:\/\/www.granitefirm.com\/blog\/us\/2023\/12\/04\/pinduoduo\/#Pinduoduo\" >Pinduoduo<\/a><\/li><\/ul><\/li><\/ul><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-10\" href=\"https:\/\/www.granitefirm.com\/blog\/us\/2023\/12\/04\/pinduoduo\/#Helps_from_noble_people\" >Helps from noble people<\/a><ul class='ez-toc-list-level-3' ><li class='ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-11\" href=\"https:\/\/www.granitefirm.com\/blog\/us\/2023\/12\/04\/pinduoduo\/#William_Ding\" >William Ding<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-12\" href=\"https:\/\/www.granitefirm.com\/blog\/us\/2023\/12\/04\/pinduoduo\/#Duan_Yongping\" >Duan Yongping<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-13\" href=\"https:\/\/www.granitefirm.com\/blog\/us\/2023\/12\/04\/pinduoduo\/#Tencent\" >Tencent<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-14\" href=\"https:\/\/www.granitefirm.com\/blog\/us\/2023\/12\/04\/pinduoduo\/#Sun_Tongyu\" >Sun Tongyu<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-15\" href=\"https:\/\/www.granitefirm.com\/blog\/us\/2023\/12\/04\/pinduoduo\/#Wang_Wei\" >Wang Wei<\/a><\/li><\/ul><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-16\" href=\"https:\/\/www.granitefirm.com\/blog\/us\/2023\/12\/04\/pinduoduo\/#Company_operations\" >Company operations<\/a><ul class='ez-toc-list-level-3' ><li class='ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-17\" href=\"https:\/\/www.granitefirm.com\/blog\/us\/2023\/12\/04\/pinduoduo\/#IPO\" >IPO<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-18\" href=\"https:\/\/www.granitefirm.com\/blog\/us\/2023\/12\/04\/pinduoduo\/#Success_factors\" >Success factors<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-19\" href=\"https:\/\/www.granitefirm.com\/blog\/us\/2023\/12\/04\/pinduoduo\/#Dispute\" >Dispute<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-20\" href=\"https:\/\/www.granitefirm.com\/blog\/us\/2023\/12\/04\/pinduoduo\/#Relying_on_second-_and_third-tier_low-price_group_buying_to_rise\" >Relying on second- and third-tier low-price group buying to rise<\/a><\/li><\/ul><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-21\" href=\"https:\/\/www.granitefirm.com\/blog\/us\/2023\/12\/04\/pinduoduo\/#Temu\" >Temu<\/a><ul class='ez-toc-list-level-3' ><li class='ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-22\" href=\"https:\/\/www.granitefirm.com\/blog\/us\/2023\/12\/04\/pinduoduo\/#The_number_of_downloads_is_astonishing\" >The number of downloads is astonishing<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-23\" href=\"https:\/\/www.granitefirm.com\/blog\/us\/2023\/12\/04\/pinduoduo\/#Reasons_to_surpass_Alibaba\" >Reasons to surpass Alibaba<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-24\" href=\"https:\/\/www.granitefirm.com\/blog\/us\/2023\/12\/04\/pinduoduo\/#Temus_biggest_advantage_cheap\" >Temu\u2019s biggest advantage: cheap<\/a><\/li><\/ul><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-25\" href=\"https:\/\/www.granitefirm.com\/blog\/us\/2023\/12\/04\/pinduoduo\/#Share_price_performance\" >Share price performance<\/a><ul class='ez-toc-list-level-3' ><li class='ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-26\" href=\"https:\/\/www.granitefirm.com\/blog\/us\/2023\/12\/04\/pinduoduo\/#The_new_leader_in_Chinese_concept_stocks\" >The new leader in Chinese concept stocks<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-27\" href=\"https:\/\/www.granitefirm.com\/blog\/us\/2023\/12\/04\/pinduoduo\/#Latest_quarters_performance\" >Latest quarter&#8217;s performance<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-28\" href=\"https:\/\/www.granitefirm.com\/blog\/us\/2023\/12\/04\/pinduoduo\/#Market_valuation\" >Market valuation<\/a><\/li><\/ul><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-29\" href=\"https:\/\/www.granitefirm.com\/blog\/us\/2023\/12\/04\/pinduoduo\/#Related_articles\" >Related articles<\/a><\/li><\/ul><\/nav><\/div>\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Pinduoduo_related_content_in_my_books\"><\/span>Pinduoduo related content in my books<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>I mentioned Pinduoduo in my previous post &#8220;<a href=\"https:\/\/www.granitefirm.com\/blog\/us\/2023\/05\/21\/chinese-apps\/\">Chinese apps are taking over the world, accounting for 33% of global downloads<\/a>&#8220;; I also mentioned Pinduoduo (ticker: PDD), a Chinese company, in two of my books. Regarding e-commerce, the content in the book will not be repeated. Investors are advised to refer to the relevant chapters of my two books:<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li>In Chapters 5 and 3 of the book <a href=\"https:\/\/www.books.com.tw\/products\/0010889106\" target=\"_blank\" rel=\"noreferrer noopener\">&#8220;The Rules of Super Growth Stocks Investing<\/a>&#8220;.<\/li>\n\n\n\n<li>In Chapter 3 of the book &#8220;<a href=\"https:\/\/www.books.com.tw\/products\/0010935641\" target=\"_blank\" rel=\"noreferrer noopener\">The Rules of 10 Baggers<\/a>&#8220;.<\/li>\n<\/ul>\n\n\n\n<p>This post will give you a more in-depth introduction to this company.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Introduction\"><\/span>Introduction<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<h3 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Founder\"><\/span>Founder<span class=\"ez-toc-section-end\"><\/span><\/h3>\n\n\n\n<p>Pinduoduo founder Colin Huang is a typical serial entrepreneur.<\/p>\n\n\n\n<p>Colin Huang\u2019s parents were from ordinary backgrounds. His parents received junior high school degrees and worked as ordinary workers in factories. He has been number one since childhood. Colin Huang himself was smart, hard-working and had outstanding grades since childhood. He graduated from Zhejiang University, one of China&#8217;s top prestigious schools. In 2002, Colin Huang was admitted to the University of Wisconsin-Madison in the United States to study for a master&#8217;s degree in computer science.<\/p>\n\n\n\n<p>He once interned at Microsoft (ticker: MSFT) for a long time and stayed in research institutes in Beijing and the United States. After completing his master&#8217;s degree, Colin Huang joined Google (ticker: GOOG and GOOGL), a subsidiary of Alphabet, which was just established at the time, in early 2004 and had three years of experience. He was first responsible for the development of advertising backend systems at Google headquarters. Later, as Google entered China, Colin Huang returned to Beijing as one of the first members and participated in the preparation of Google China.<\/p>\n\n\n\n<p>When he joined Google, it was just when Google began to develop at a rapid pace. Within half a year of joining Google, Google went public. Colin Huang&#8217;s salary has increased a lot, and the options are a huge sum of money. It is precisely because this important experience at Google will help him a lot in establishing an online e-commerce business in the future, as well as his vision of the Internet world and the technology industry.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"The_history_of_Pinduoduo\"><\/span>The history of Pinduoduo<span class=\"ez-toc-section-end\"><\/span><\/h3>\n\n\n\n<h4 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Oku\"><\/span>Oku<span class=\"ez-toc-section-end\"><\/span><\/h4>\n\n\n\n<p>After leaving Google, with Duan Yongwen&#8217;s assistance and his own efforts, the company he founded, Oku, became the top three e-commerce website in the mobile phone and electronic education categories three years later, with annual revenue of more than 60 million yuan. Because he analyzed that he could not advance further in this field, he felt that he could not compete with JD.com (ticker: JD) in this industry, so he might as well give up voluntarily. He decided to sell the company.<\/p>\n\n\n\n<h4 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Leqee\"><\/span>Leqee<span class=\"ez-toc-section-end\"><\/span><\/h4>\n\n\n\n<p>Before the sale of Oku was completed, Colin Huang had hatched a new company from Oku in 2009, called Leqee, which was engaged in e-commerce agency operations. The core members were all the original members of Oku. .<\/p>\n\n\n\n<h4 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Xinyoudi_Studio\"><\/span>Xinyoudi Studio<span class=\"ez-toc-section-end\"><\/span><\/h4>\n\n\n\n<p>In 2013, while Colin Huang was running Leqi, he also transferred core personnel from Leqi and established a new company, a game company called Xinyoudi Studio.<\/p>\n\n\n\n<h4 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"PinHaoHuo\"><\/span>PinHaoHuo<span class=\"ez-toc-section-end\"><\/span><\/h4>\n\n\n\n<p>While recuperating at home, Colin Huang played with his mobile phone every day and discovered a phenomenon: the time people spend on mobile social apps accounts for 40% of the time they use mobile phones, but the e-commerce sales achieved from this are less than the total e-commerce sales 1%. He felt that there was much to be done here.<\/p>\n\n\n\n<p>While maintaining the operations of Leqi and Xinyoudi Studio, Colin Huang started working on a new project: using WeChat\u2019s social connections to create group groups. The name of the new project is: Pinhaohuo. Pinhaohuo started by registering a service account on WeChat, posting information about fruit grouping, and then spreading the information virally through the community. After the customer gathers enough people in the group to place the order, the team will put together the goods and then go purchase fruit for delivery. Due to the very low price of group buying fruits, it quickly attracted the first batch of seed users and was officially launched on April 10, 2015.<\/p>\n\n\n\n<p>As Colin Huang vigorously strengthened the construction of back-end operation capabilities, Pinhaohuo immediately began to take off. After a few months, the number of active users exceeded 10 million.<\/p>\n\n\n\n<h4 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Pinduoduo\"><\/span>Pinduoduo<span class=\"ez-toc-section-end\"><\/span><\/h4>\n\n\n\n<p>Pinduoduo has keenly observed this and used gamification thinking to design the entire shopping process so that the behavior of shopping is closely integrated with social networking and playing games. This point was later summarized by Colin Huang as: Pinduoduo is doing &#8220;Costco+Disney&#8221;, and it was written into Pinduoduo&#8217;s prospectus.<\/p>\n\n\n\n<p>Xinyoudi Studio mobilized more than 20 people and started operating a new project, named: Pinduoduo. In September 2015, Pinduoduo was launched.<\/p>\n\n\n\n<p>Ingeniously designed by the game company, Pinduoduo\u2019s \u201cGroup Buying\u201d and \u201cChopping\u201d have caused viral spread on WeChat. During that time, almost every WeChat user\u2019s phone was hacked by friends. Information bombardment comes round after round.<\/p>\n\n\n\n<p>It is conceivable that after Pinduoduo was launched, its development speed was even more exaggerated than that of Pinduoduo. Without any advertising in the early days, relying solely on WeChat user fission, daily orders exceeded one million and monthly GMV exceeded 1 billion within one year of launch.<\/p>\n\n\n\n<p>Afterwards, Colin Huang merged Pinduoduo and Pinhaohuo. The new company continued to use the name Pinduoduo and made rapid progress. It carved a new path between the two giants Alibaba and JD.com and grew into the third largest company in China. Big e-commerce.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Helps_from_noble_people\"><\/span>Helps from noble people<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<h3 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"William_Ding\"><\/span>William Ding<span class=\"ez-toc-section-end\"><\/span><\/h3>\n\n\n\n<p>When Colin Huang was studying at Zhejiang University, he attracted the attention of William Ding, the founder of NetEase (ticker: NTES), because he published some in-depth insights on a technology forum. NetEase&#8217;s William Ding obtained Colin Huang&#8217;s communication through the Internet and solved a technical problem that troubled William Ding. After that, William Ding and Colin Huang still kept in touch. Later, Colin Huang went to study in the United States, and William Ding enthusiastically introduced his friends to him.<\/p>\n\n\n\n<p>Colin Huang went to the University of Wisconsin-Madison in the United States to study for a master&#8217;s degree in computing. William Ding introduced him to his friend Duan Yongping, another noble person who influenced his life. Duan Yongping admired him very much as soon as he chatted with him, and soon became his lifelong friend. Since then, Duan Yongping often gave Colin Huang&#8217;er advice and taught him many principles of life, business and entrepreneurship. For 22-year-old Colin Huang, having such a big boss at his side to give guidance and support at any time will undoubtedly be of great help to his life.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Duan_Yongping\"><\/span>Duan Yongping<span class=\"ez-toc-section-end\"><\/span><\/h3>\n\n\n\n<p>Colin Huang himself believed that he was another disciple of Duan Yongping, one of Duan Yongping&#8217;s three subordinates at BBK Group. Duan Yongping responded modestly to reporters&#8217; questions and said that Colin Huang&#8217;s achievements were his own efforts and had nothing to do with him. But later Colin Huang publicly stated that he had received guidance from Duan Yongping in various aspects, including life and entrepreneurship, and he identified Duan Yongping as his mentor in life.<\/p>\n\n\n\n<p><strong>Note<\/strong>: Tony&nbsp;Chen, Wei Shen, Zhijiang Jin, and Pinduoduo\u2019s Colin Huang are known as Duan Yongping\u2019s \u201cfour disciples\u201d. They are now the founders of OPPO, vivo, CEO of BBK, and founder of Pinduoduo. <\/p>\n\n\n\n<p>In 2006, Duan Yongping spent 4 million yuan to treat Buffett to a meal. At this table, in addition to his family, Duan Yongping also brought a young man. This person was Colin Huang, who was only in his 20s at that time. At that time, Colin Huang was still a little-known person, it can be seen that Duan Yongping supports and loves Colin Huang. According to Colin Huang&#8217;s recollection of the lunch many years later, Colin Huang believed that it would be extremely helpful to his future entrepreneurship, stock market, and vision.<\/p>\n\n\n\n<p><strong>Note<\/strong>: For Duan Yongping&#8217;s full story in detail, please see my another articles: &#8220;<a href=\"https:\/\/www.granitefirm.com\/blog\/us\/2024\/01\/15\/duan-yongping\/\" target=\"_blank\" rel=\"noreferrer noopener\">Duan Yongping\u2019s investment empire and his BBK Group<\/a>&#8220;<\/p>\n\n\n\n<h3 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Tencent\"><\/span>Tencent<span class=\"ez-toc-section-end\"><\/span><\/h3>\n\n\n\n<p>Tencent (ticker: TCEHY) has a keen eye to recognize heroes and invested in Pinduoduo very early. Because they are large and medium-sized shareholders, and Pinduoduo relies on social networks to rise, the two parties hit it off. Pinduoduo used the WeChat social networking platform, which is controlled or almost monopolized, to spread virally and create astonishing e-commerce transaction volume achievements.<\/p>\n\n\n\n<p>In 2019, Tencent\u2019s shares accounted for 30.9% of Pinduoduo\u2019s equity. Even by 2023, Tencent&#8217;s shares will still be as high as 14.7% of Pinduoduo&#8217;s shares.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Sun_Tongyu\"><\/span>Sun Tongyu<span class=\"ez-toc-section-end\"><\/span><\/h3>\n\n\n\n<p>He is employee No. 003 of Alibaba and founded Taobao until 2008. If we talk about the person who has the greatest achievements and the most experience in e-commerce in China, Sun Tongyu is considered the number one. Therefore, if Colin Huang wants to find someone to ask for advice on how to build an e-commerce platform,<br>After searching all over China, Sun Tongyu was the most suitable person.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Wang_Wei\"><\/span>Wang Wei<span class=\"ez-toc-section-end\"><\/span><\/h3>\n\n\n\n<p>Wang Wei is the founder and head of SF Express. E-commerce is inseparable from logistics, and Wang Wei is the leader of the domestic logistics industry. If Pinduoduo wants to improve its logistics, Wang Wei is the best person to consult.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Company_operations\"><\/span>Company operations<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<h3 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"IPO\"><\/span>IPO<span class=\"ez-toc-section-end\"><\/span><\/h3>\n\n\n\n<p>In July 2018, less than three years after its establishment, Pinduoduo was successfully listed in the United States with a market value of 160 billion yuan. Colin Huang&#8217;s personal assets immediately exceeded 80 billion yuan (in 2023, his shares accounted for 26.5% of Pinduoduo&#8217;s equity). It is the most amazing and fastest wealth creation myth in the history of China\u2019s Internet development.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Success_factors\"><\/span>Success factors<span class=\"ez-toc-section-end\"><\/span><\/h3>\n\n\n\n<p>There are below four factors:<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li>One is to seize the opportunity of the mobile social and decentralized era. We spend about 40% of our time on mobile social products every day, mainly WeChat. Decentralization is reflected in Pinduoduo\u2019s transformation of \u201cpeople looking for goods\u201d into \u201cgoods looking for people.\u201d<\/li>\n\n\n\n<li>Add an element of gaming to your shopping. Pinduoduo gives people a good reason: I am not doing it for fun, but to save money for my family.<\/li>\n\n\n\n<li>A team that has been working together for a long time, continues to grow, and is capable of everything.<\/li>\n\n\n\n<li>Luck and the help of noble people.<\/li>\n<\/ul>\n\n\n\n<h3 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Dispute\"><\/span>Dispute<span class=\"ez-toc-section-end\"><\/span><\/h3>\n\n\n\n<ul class=\"wp-block-list\">\n<li>Counterfeit products are widely criticized.<\/li>\n\n\n\n<li>Information bombardment.<\/li>\n\n\n\n<li>Complaints from suppliers: After Pinduoduo grew stronger and regulatory requirements became stricter, many merchants began to complain.<\/li>\n\n\n\n<li>Employee benefits: Many people may not know that Pinduoduo does not have weekend breaks. But when Pinduoduo went public in 2018, Colin Huang gave an internal speech and some employees asked whether they could have weekend breaks. Colin Huang denied this.<\/li>\n<\/ul>\n\n\n\n<h3 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Relying_on_second-_and_third-tier_low-price_group_buying_to_rise\"><\/span>Relying on second- and third-tier low-price group buying to rise<span class=\"ez-toc-section-end\"><\/span><\/h3>\n\n\n\n<p>Pinduoduo uses the social e-commerce model to closely integrate social networking and shopping, allowing consumers to do group purchases with friends and family while shopping. Allow users to place orders with sellers or manufacturers through group purchases to obtain significant discounts.<\/p>\n\n\n\n<p>Secondly, Pinduoduo has successfully captured consumers in China\u2019s vast sinking market. Although the purchasing power of a single consumer in this market may not be as good as that of consumers in first- and second-tier cities, the overall scale of this market is huge. Pinduoduo\u2019s low-price strategy caters to this segment of consumers. the needs of the users.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Temu\"><\/span>Temu<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<h3 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"The_number_of_downloads_is_astonishing\"><\/span>The number of downloads is astonishing<span class=\"ez-toc-section-end\"><\/span><\/h3>\n\n\n\n<p>According to Statista and App Magic data provided by the investment analysis website Stocklytics.com, as of September 2024, Pinduoduo&#8217;s Temu application has been downloaded more than 735 million times globally, and its monthly visits in the first quarter of 2024 exceeded 500 million times.<\/p>\n\n\n\n<p>Statista and AppMagic data also show that the Temu shopping app was downloaded 337 million times in 2023, nearly 80% more than the Amazon app. Additionally, data shows Temu was downloaded nearly 55 million times globally in August, a 42% increase from the same month in 2023.<\/p>\n\n\n\n<p>Temu also had more than 50 million monthly downloads in May, June and July 2024, three times more than Amazon. AppMagic data shows that U.S. consumers have downloaded the Temu app more than 200 million times since its launch in 2022, accounting for 27% of total Temu downloads.<\/p>\n\n\n\n<p>Statistics also show that US consumers use Temu five times more than European consumers, while downloads in countries such as the UK, Germany, France and Spain only account for around 5% of total downloads.<\/p>\n\n\n\n<p>Temu&#8217;s second-largest market, Mexico, accounts for just 10% of total downloads, three times less than the United States. South Korea accounted for 3% of total downloads, and other countries combined accounted for 43% of total downloads.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Reasons_to_surpass_Alibaba\"><\/span>Reasons to surpass Alibaba<span class=\"ez-toc-section-end\"><\/span><\/h3>\n\n\n\n<p>The market value of new e-commerce power Pinduoduo has surpassed that of leading Alibaba (ticker: BABA), becoming the Chinese concept stock with the highest value in the US stock market. The main reason is that Pinduoduo\u2019s cross-border e-commerce platform Temu has grown rapidly, showing that its innovative model and future development potential are greater.<\/p>\n\n\n\n<p>When Alibaba reached its peak in October 2020, its market capitalization exceeded US$850 billion. Since then, its stock price has plummeted, with no signs of stopping.<\/p>\n\n\n\n<p>Pinduoduo has always used low prices as its main competitive strategy. This caters to the trend of consumers increasingly favoring cost-effective products.<\/p>\n\n\n\n<p>When the growth of e-commerce giants such as Tmall, Taobao and JD.com began to slow down, there were many reasons why Pinduoduo achieved amazing growth: first,<\/p>\n\n\n\n<p>Industry analysts said that Pinduoduo\u2019s market value surpassed that of Alibaba, reflecting investors\u2019 different views and expectations of the two companies. Investors may believe that Pinduoduo\u2019s innovative model and future development potential are greater, and therefore give it a higher valuation. Although Alibaba&#8217;s business is diversified and mature, it may face some growth pressure.<\/p>\n\n\n\n<p>TEMU is taking over Pinduoduo\u2019s main website and becoming the \u201csecond curve\u201d of performance growth. In the third quarter of this year, Pinduoduo\u2019s commission income was RMB 29.2 billion (approximately NT$129.4 billion), a surge of 315%, which is speculated to be mainly due to the rapid growth of TEMU.<\/p>\n\n\n\n<p>In September 2022, Temu was launched in North America for the first time. In more than a year, it has entered European and American countries such as the United States, Canada, Australia, the United Kingdom, and France, as well as Asian countries such as Japan, South Korea, the Philippines, and Malaysia. So far, it has been launched in 48 countries and regions. <\/p>\n\n\n\n<p>Temu was the most-downloaded iPhone app in the US in 2023.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Temus_biggest_advantage_cheap\"><\/span>Temu\u2019s biggest advantage: cheap<span class=\"ez-toc-section-end\"><\/span><\/h3>\n\n\n\n<p>Probolsky Research emailed Chain Store Age the results of a recent survey of 340 U.S. consumers who had purchased from Amazon and Temu in the past year, asking them to rate the two e-retailers on a number of factors. Compare the giants.<\/p>\n\n\n\n<p>Related results show that three-quarters (76%) of respondents believe Temu is cheaper than Amazon. Probolsky Research analysis shows that while both companies have their strengths, Temu wins over respondents on price, while Amazon leads on shipping speed and product variety.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Share_price_performance\"><\/span>Share price performance<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<h3 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"The_new_leader_in_Chinese_concept_stocks\"><\/span>The new leader in Chinese concept stocks<span class=\"ez-toc-section-end\"><\/span><\/h3>\n\n\n\n<p>As of the close on 11\/30\/2023, it closed up 4.03% at $147.44, with a total market value of $195.9 billion. On the same day, Alibaba closed up 0.25% on the New York Stock Exchange to US$74.88, with a market value of US$190.7 billion.<\/p>\n\n\n\n<p>Pinduoduo&#8217;s market capitalization is nearly $196 billion, surpassing historic rival Alibaba, which is worth $8.7 billion less. (Game and social media giant Tencent is also an important competitor of Alibaba, with a market value of nearly US$400 billion.) Today, Pinduoduo\u2019s market value has surpassed JD.com and Alibaba, and it only took Pinduoduo eight years.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Latest_quarters_performance\"><\/span>Latest quarter&#8217;s performance<span class=\"ez-toc-section-end\"><\/span><\/h3>\n\n\n\n<p>Pinduoduo&#8217;s financial report released on November 28, 2023 showed that the total revenue in the third quarter was 68.84 billion yuan, a surge of 93.9% over the same period last year; the net profit was 17.0271 billion yuan, also a substantial increase of 37%. Because the revenue was much higher than expected, Pinduoduo&#8217;s stock price rose 18.08% on the US stock market that day.<\/p>\n\n\n\n<p>Alibaba&#8217;s financial report for the same period was revenue of US$30.81 billion, a growth of only 9%. The cloud computing department performed poorly, growing only 2.2%. What&#8217;s more serious is that the plan to spin off the cloud computing department was canceled due to U.S. chip restrictions. To make matters worse, the Jack Ma family sold a large number of Alibaba shares on the New York Stock Exchange. All factors combined caused the company&#8217;s stock price to plummet 9.14% that day.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Market_valuation\"><\/span>Market valuation<span class=\"ez-toc-section-end\"><\/span><\/h3>\n\n\n\n<p>Pinduoduo&#8217;s forward price-to-earnings ratio is 21.4, the highest among rivals such as JD.com and Vipshop (ticker: VIPS). Alibaba has a forward price-to-earnings ratio of 7.62, according to LSEG estimates.<\/p>\n\n\n\n<figure class=\"wp-block-image size-full\"><img loading=\"lazy\" decoding=\"async\" width=\"119\" height=\"36\" src=\"https:\/\/www.granitefirm.com\/blog\/us\/wp-content\/uploads\/sites\/2\/2023\/12\/pdd.jpg\" alt=\"Pinduoduo\" class=\"wp-image-22861\"\/><figcaption class=\"wp-element-caption\">credit: Pinduoduo<\/figcaption><\/figure>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Related_articles\"><\/span>Related articles<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<ul class=\"wp-block-list\">\n<li>&#8220;<a href=\"https:\/\/www.granitefirm.com\/blog\/us\/2025\/05\/31\/chinese-tech-singularity\/\">Chinese tech singularity or just a flash in the pan? From DeepSeek, Huawei, TikTok, to Game Science<\/a>&#8220;<\/li>\n\n\n\n<li>&#8220;<a href=\"https:\/\/www.granitefirm.com\/blog\/us\/2025\/02\/08\/deepseek-rout\/\">DeepSeek routed the global AI and stock<\/a>&#8220;<\/li>\n\n\n\n<li>&#8220;<a href=\"https:\/\/www.granitefirm.com\/blog\/us\/2025\/02\/12\/chinese-ai-companies\/\">Chinese AI progress and top companies<\/a>&#8220;<\/li>\n\n\n\n<li>&#8220;<a href=\"https:\/\/www.granitefirm.com\/blog\/us\/2024\/09\/30\/bytedance\/\">ByteDance, TikTok&#8217;s parent comapny, the world\u2019s most valuable unicorn<\/a>&#8220;<\/li>\n\n\n\n<li>&#8220;<a href=\"https:\/\/www.granitefirm.com\/blog\/us\/2023\/12\/04\/pinduoduo\/\" target=\"_blank\" rel=\"noreferrer noopener\">How does Pinduoduo make money, why it surpass Alibaba and become No. valuable listed Chinese companies in US?<\/a>&#8220;<\/li>\n\n\n\n<li>&#8220;<a href=\"https:\/\/www.granitefirm.com\/blog\/us\/2024\/01\/15\/duan-yongping\/\" target=\"_blank\" rel=\"noreferrer noopener\">Duan Yongping\u2019s investment empire and his BBK Group<\/a>&#8220;<\/li>\n\n\n\n<li>&#8220;<a href=\"https:\/\/www.granitefirm.com\/blog\/us\/2023\/05\/21\/chinese-apps\/\">Chinese apps are taking over the world, accounting for 33% of global downloads<\/a>&#8220;<\/li>\n\n\n\n<li>&#8220;<a href=\"https:\/\/www.granitefirm.com\/blog\/us\/2025\/10\/28\/shopify-surpassed-amazon\/\">Shopify surpassed Amazon in some important e-commerce metrics<\/a>&#8220;<\/li>\n\n\n\n<li>&#8220;<a href=\"https:\/\/www.granitefirm.com\/blog\/us\/2023\/09\/30\/shein\/\" target=\"_blank\" rel=\"noreferrer noopener\">How does Shein, the world&#8217;s fastest growing fast fashion seller, make money?<\/a>&#8220;<\/li>\n\n\n\n<li>&#8220;<a href=\"https:\/\/www.granitefirm.com\/blog\/us\/2021\/10\/18\/lets-talk-about-tiktok\/\">TikTok, the rival of all social networks<\/a>&#8220;<\/li>\n\n\n\n<li>&#8220;<a href=\"https:\/\/www.granitefirm.com\/blog\/us\/2023\/04\/07\/alibaba-spin-off\/\">Why is Alibaba spin-off unanimously optimistic?<\/a>&#8220;<\/li>\n\n\n\n<li>&#8220;<a href=\"https:\/\/www.granitefirm.com\/blog\/us\/2021\/12\/16\/amazon-vs-alibaba\/\" target=\"_blank\" rel=\"noreferrer noopener\">Amazon vs. Alibaba<\/a>&#8220;<\/li>\n\n\n\n<li>&#8220;<a href=\"https:\/\/www.granitefirm.com\/blog\/us\/2021\/10\/25\/tencent-vs-alibaba\/\" target=\"_blank\" rel=\"noreferrer noopener\">Tencent vs. Alibaba, part one<\/a>&#8220;<\/li>\n\n\n\n<li>&#8220;<a href=\"https:\/\/www.granitefirm.com\/blog\/us\/2021\/12\/07\/tencent-vs-alibaba-deep-dive-on-significant-differences-in-operation\/\" target=\"_blank\" rel=\"noreferrer noopener\">Tencent vs. Alibaba, part two<\/a>&#8220;<\/li>\n\n\n\n<li>&#8220;<a href=\"https:\/\/www.granitefirm.com\/blog\/us\/2021\/08\/28\/the-biggest-risk-to-hold-chinese-stocks-taking-alibaba-and-tencent-as-examples\/\" target=\"_blank\" rel=\"noreferrer noopener\">The biggest risk to hold Chinese stocks, taking Alibaba and Tencent as examples<\/a>&#8220;<\/li>\n\n\n\n<li>&#8220;<a href=\"https:\/\/www.granitefirm.com\/blog\/us\/2022\/06\/07\/chinese-stocks-is-unwise\/\">Are Chinese stocks suitable for long-term investment?<\/a>&#8220;<\/li>\n\n\n\n<li><a href=\"https:\/\/www.granitefirm.com\/blog\/us\/2021\/06\/03\/why-do-many-chinese-companies-want-to-go-public-in-the-united-states\/\">Why do many Chinese companies want to go public in the United States?<\/a>&#8220;<\/li>\n\n\n\n<li>&#8220;<a href=\"https:\/\/www.granitefirm.com\/blog\/us\/category\/us-stocks-knowledge\/chinese-stocks\/\" target=\"_blank\" rel=\"noreferrer noopener\">Chinese stocks is not a wise choice<\/a>&#8220;<\/li>\n\n\n\n<li>&#8220;<a href=\"https:\/\/www.granitefirm.com\/blog\/us\/2022\/06\/14\/china-and-us-gap\/\">The gap between China and US, is all China-made software and hardware possible?<\/a>&#8220;<\/li>\n<\/ul>\n\n\n\n<p><em><strong>Disclaimer<\/strong><\/em><\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li><em>The content of this site is the author\u2019s personal opinions and is for reference only. I am not responsible for the correctness, opinions, and immediacy of the content and information of the article. Readers must make their own judgments.<\/em><\/li>\n\n\n\n<li><em>I shall not be liable for any damages or other legal liabilities for the direct or indirect losses caused by the readers&#8217; direct or indirect reliance on and reference to the information on this site, or all the responsibilities arising therefrom, as a result of any investment behavior.<\/em><\/li>\n<\/ul>\n","protected":false},"excerpt":{"rendered":"<p>The main reason is that Pinduoduo\u2019s cross-border e-commerce platform Temu has grown rapidly, showing that its innovative model and future development potential are greater.<\/p>\n","protected":false},"author":1,"featured_media":22861,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[1153,391,130,91,420,26,11],"tags":[158,97,95,274,3,334,664,232,1162],"class_list":["post-22860","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-chinese-companies-listed-in-us","category-duan-yongping","category-ecommerce","category-entrepreneur","category-founders","category-hong-kong-stock-market","category-buffett","tag-baba","tag-goog","tag-googl","tag-jd","tag-msft","tag-ntes","tag-pdd","tag-tcehy","tag-vips"],"_links":{"self":[{"href":"https:\/\/www.granitefirm.com\/blog\/us\/wp-json\/wp\/v2\/posts\/22860","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.granitefirm.com\/blog\/us\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.granitefirm.com\/blog\/us\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.granitefirm.com\/blog\/us\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.granitefirm.com\/blog\/us\/wp-json\/wp\/v2\/comments?post=22860"}],"version-history":[{"count":46,"href":"https:\/\/www.granitefirm.com\/blog\/us\/wp-json\/wp\/v2\/posts\/22860\/revisions"}],"predecessor-version":[{"id":39680,"href":"https:\/\/www.granitefirm.com\/blog\/us\/wp-json\/wp\/v2\/posts\/22860\/revisions\/39680"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.granitefirm.com\/blog\/us\/wp-json\/wp\/v2\/media\/22861"}],"wp:attachment":[{"href":"https:\/\/www.granitefirm.com\/blog\/us\/wp-json\/wp\/v2\/media?parent=22860"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.granitefirm.com\/blog\/us\/wp-json\/wp\/v2\/categories?post=22860"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.granitefirm.com\/blog\/us\/wp-json\/wp\/v2\/tags?post=22860"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}