Ep. 30: The Greatest Trainwreck of China Internet -- Renren, China’s Facebook

In episode 30 of TechBuzz China, co-hosts Ying-Ying Lu and Rui Ma talk about Renren Inc., the closest Chinese analogue to Facebook. The former near-monopoly on the Chinese social networking space, which had formerly raised $800 million in its 2011 IPO, recently announced that it would sell all of its renren.com social networking assets to Beijing Infinities Technology, a holding company, for a mere $20 million in cash and $40 million worth of stock. This episode explores: what happened? Rui and Ying-Ying follow the winding history of Renren, starting with the background of its founder, Joe Chen; through its acquisition of Wang Xing’s Xiaonei social network; through its NYSE listing-- which, by the way, Rui’s investment banking firm at the time played a small role in. Though the public offering was successful, even hailed as a “prelude to Facebook’s IPO,” things started going downhill from there. By 2016, total revenues had dropped by half to $63 million, and the company was consistently reporting losses of active users. This decline has been so stark, in fact, that when CEO Joe Chen announced in a post on Renren.com that the company had been sold, the post only had about 800 views after 12 hours. What are the reasons for this outcome? What roles have poor strategic decisions, the founder’s vision (or lack of vision) and ethics, and Renren’s insistence on continually bandwagoning onto the latest hot trend played? How is it that by 2017, 75 percent of Renren Group’s revenues were coming from used car sales and financing; and that in contrast, Renren.com business made up just 9 percent of the Group’s revenues in Q2 of this year? Listen to the newest episode of TechBuzz China and join Rui and Ying-Ying in analyzing the rise and fall of one of China’s most iconic internet brands. Throughout, our co-hosts also lean into an unspoken question that is perhaps on many of our listeners’ minds as well: What lessons can Facebook and other U.S.-based social platforms learn from this incredible story? As always, you can find these stories and more at pandaily.com. Let us know what you think of the show by leaving us an iTunes review, liking our Facebook page, and tweeting at us at @techbuzzchina to win some swag! Finally, a huge shoutout to our new listeners over at dealstreetasia.com.