China’s third-richest man is a fairly new kid on the block — and among the nation’s youngest billionaire entrepreneurs. After a 14.5% surge in share price on Friday that fostered Huang’s fortune by $4.5 billion, Huang is currently worth $35.6 billion, according to Forbes — getting the 25th richest person on the planet.
In net worth stipulations, that puts him behind two giant Chinese net titans: Tencent chairman Ma Huateng (worth $46.4 billion) and Alibaba co-founder Jack Ma (worth $41.3 billion), whose businesses have been launched in 1998 and 1999, respectively.
Pinduoduo stock has rocketed up over the last two months amid rising demand for online shopping during the coronavirus pandemic. The business is famous for pioneering social e-commerce in China: Shoppers can get lower prices if they could find others who will purchase items with them as a group. The version was a hit, bringing 100 million monthly active users to its platform in its first year.
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However, investors look bullish on Pinduoduo’s growth potential. Huang, who owns a 45% stake in the company, was the richest person in China in mid March, with a $16.5 billion net worth.
“Covid-19 has unleashed powerful forces which are altering the way we live, work, and play. It’s compressed the years of this behavioral change and accelerated the adoption of internet trade at an unprecedented rate,” Huang said in Friday’s earnings call. “Our mission has never been more relevant or salient in these challenging times, which is to supply a fun and engaging atmosphere for individuals to shop together and find the best deal for their money.”
The company rolled out live streaming features to all its retailers in January, which makes it much easier for consumers to buy products like luxury jewelry or live fish, which buyers prefer to see in person. Additionally, it held live streaming arenas in agricultural hubs throughout the coronavirus pandemic to emphasize locally created specialties; the company says the March fairs led to 49 million orders as of April 30th. Pinduoduo intends to spend $7 billion (RMB 50 billion) within the next five years to develop infrastructure to help farmers market their products online.
Pinduoduo’s expansion comes at a time of renewed tension between China and the U.S. and worries about U.S.-listed Chinese businesses. On May 20, the U.S. Senate passed a bill that would permit the Securities and Exchange Commission to pub trading of any inventory if the listed company’s auditing firm can’t be inspected by the Public Company Accounting Oversight Board for three successive years.
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Companies would also need to establish that they are not owned or controlled by any foreign government. Although the new law applies to any company on the U.S. stock exchanges, the transfer is largely regarded as a target at China, after Nasdaq-listed Luckin Coffee — a Chinese firm — confessed to falsifying roughly $310 million of earnings in 2019. Its stock, which traded at over $50 per share in January, has cratered to below $1.50 per share.
He interned at Microsoft as a pupil but chose to take a chance on Google rather after he graduated in 2004. “I didn’t decide to remain at Microsoft after graduation. Since first I could see what I’d become at Microsoft ten decades after,” Huang wrote in a 2016 blog article.
Huang began as a software engineer in the search engine giant, finally becoming part of its first China team as it expanded to the populous state. He struck out on his own, founding online game firm Xinyoudi and e-commerce stage Ouku.com before making it big with Pinduoduo.