On-demand Delivery Platform Dada Nexus Files for IPO on Nasdaq

Chinese local on-demand delivery and retail platform Dada Nexus today formally filed with the US Securities and Exchange Commission, aiming to be listed on the Nasdaq stock market with the code “DADA.”

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The size of this initial public offering (IPO) is currently $100 million, but many suspect that this is likely a placeholder for a deal that could increase to $500 million. Dada is the second tech company trying to go public in the US during the outbreak, following the successful listing of Kingsoft Cloud.

Dada’s revenue in the first quarter this year was roughly 1.1 billion yuan ($155 million), which doubled from last year’s 5.3 billion yuan. Its annual revenues in 2017, 2018 and 2019 were 1.2 billion yuan, 1.9 billion yuan and 3.1 billion yuan, respectively. However, it’s still on a losing track, though the revenue-cost gap is closing. The on-demand delivery platform posted net losses of 1.4 billion yuan, 1.9 billion yuan and 1.7 billion for the past three years. The net loss for Q1 2020 was 279 million yuan, dropping from 337 million yuan last year.

Founded in June 2014, Dada owns two major delivery platforms, Dada Now and JDDJ. It received a series C financing of $100 million from DST Global, Sequoia Capital and Jinglin Capital in June 2015. E-commerce company JD.com acquired about 47.4% of Dada’s shares in 2017 with its local on-demand retail platform JDDJ, its business resources and $200 million in cash, and became Dada’s single largest shareholder. JD.com and Walmart made another round of investment in August 2018.

According to the prospectus, after the IPO, CEO Philip Kuai and CTO Jun Yang will own 8.3% and 1.7%. JD.com, Sequoia Capital, Azure and DST will hold 47.4%, 10.5%, 9.9% and 8.7% of the shares respectively.