China — Tudou Holdings, China’s second-largest online video site, fell 19 percent today in its first day of trading after rising $174 million in a recent U.S. initial public offering.
Founded in 2005, the company hosts over 40 million videos viewed by over 200 million unique visitors each month. After selling six million American depositary receipts at $29 a piece yesterday, the Shanghai-based firm watched as ADRs fell 6.6 percent to $27.10 after opening below its offering price.
Tudou priced its stock at a 58 percent discount to its major competitor and China’s top video site, Youku.com, which went public in December, 2009.
“We have plenty of challenges ahead to make sure we can bring in enough content to meet users’ needs, that the platform is growing rapidly and advertising numbers are also growing rapidly,” said Tudou CEO Gary Wang in a phone interview with Bloomberg. “We want to use the proceeds to grow the company organically.”
Tudou, which is a Hulu-like website, raised $126 million from General Catalyst, IDG Capital Partners, and GGV Capital since its founding. The IPO valued Tudou at $822 million.
Note to readers: the video below is hosted by Tudou and takes a very long time to load.