Blued: Same-sex social networking parent company's annual revenue is nearly 800 million yuan, and nearly half of its monthly active users are overseas

On June 16, 2020, BlueCity Holdings Ltd., the parent company of the LGBTQ community Blued, submitted a prospectus to the SEC with the stock code "BLCT" and is expected to raise US$50 million.

BlueCity Brothers will use the funds raised this time for business expansion including marketing and promotion, research and development of technologies such as artificial intelligence, daily operations, and potential strategic acquisitions, investments and alliances.

Overseas monthly active users account for more than 49%

As of the first quarter of 2020, Blued has more than 49 million registered users worldwide, covering more than 210 countries and regions.

Among the 6 million monthly active users, overseas monthly active users account for more than 49%. Its average MAU and average DAU are 6 times and nearly 7 times that of the second place in the same industry in China respectively.

The Blued mobile app is a one-stop terminal for BlueCity Brothers’ major products, platforms and services; it is one of the earliest LGBTQ communities in China and a leading LGBTQ community in the world.

The Blued mobile app provides communication, social entertainment, live streaming and other services based on precise geographic positioning; it also includes health, family planning and other services, aiming to provide "full life cycle services" for the LGBTQ community.

BlueCity Brothers achieved revenue of 759 million yuan in 2019, a year-on-year increase of 51.4% compared to 501 million yuan in 2018. Revenue in the first quarter of 2020 reached 207 million yuan, compared with 145 million yuan in the same period of 2019.

Blue City Brothers' revenue structure is becoming increasingly diversified. In addition to the continued growth in live broadcast revenue, the proportion of membership service revenue in revenue continues to increase.

The number of paying users of Blue City Brothers' membership service increased from 85,000 in 2018 to 457,000 in 2019. Membership income also grew rapidly, from 3.06 million yuan in the first quarter of 2019 to 15.01 million yuan in 2020, a year-on-year increase of 390.6%. The proportion of membership income in total revenue also increased from 2.1% in 2019 to 3.7%.

While revenue has grown rapidly, BlueCity Brothers' adjusted net loss rate has continued to narrow in the past two years, to 18.0% and 6.9% respectively. In the first quarter of 2020, the company's adjusted net loss narrowed to 7.6 million yuan, with a net loss rate of 3.7%.

Strategically, BlueCity's overseas business revenue has grown rapidly in recent years. According to the global LGBTQ industry development report of the well-known consulting firm Frost & Sullivan, based on the average MAU statistics in 2019, Blued has become the largest online LGBTQ community in countries and regions such as India, South Korea, Thailand and Vietnam.

As a brand that has been serving vertical communities for a long time, Blued's sense of community is based on extremely high user stickiness and continuously growing payment capabilities.

The reason behind the continuous growth of live broadcast service revenue is the high willingness of users to pay. In the first quarter of 2020, the revenue of live broadcast service was 180 million yuan. In 2019, the average payment unit price per paying user of live broadcast service alone was as high as 2,059 yuan, a year-on-year increase of 61%.

According to a Frost & Sullivan report, the average daily stay time of Blued's active users in 2019 exceeded 60 minutes, the average daily opening frequency exceeded 16 times, and the next-month retention rate reached 71.0%. Its average MAU and average DAU were 6 times and nearly 7 times that of the second place in the domestic industry, respectively.

Behind user stickiness and paying ability is the continuously growing "pink economy".

According to a Frost & Sullivan report, the average disposable income of the LGBTQ population is generally higher than that of the general population. Based on consumer expenditure and marketing expenditure, the global LGBTQ market size was US$3.9 trillion in 2018 and is expected to reach US$5.4 trillion by 2023, with a compound annual growth rate of 7.0%.

Shunwei CDH Capital is a shareholder

In 2000, BlueCity’s predecessor, Danlan.com, one of China’s earliest and most influential LGBTQ online forums, was launched;

In 2013, BlueCity completed its angel round of financing;

In 2014, BlueCity completed its A and B rounds of financing;

In 2016, the Blued mobile app launched live streaming services;

In 2017, BlueCity launched the Blue Baby business and completed its Series D financing;

In 2018, the Blued mobile app launched membership services;

In 2019, BlueCity Company joined hands with the China STD and AIDS Foundation to establish the Danlan Charity Special Fund.

The founder, chairman and CEO of Blue City Brothers is Ma Baoli. In 2000, Ma Baoli, who was still a policeman, used the pseudonym "Geng Le" to establish China's earliest and most influential LGBTQ online forum, Danlan.com.

Danlan.com is the predecessor of BlueCity. In 2011, he resigned from the police and devoted himself to the LGBT cause. BlueCity was officially established in the same year, and Blued was launched a year later.

In March 2016, the Financial Times announced the 2016 Boldness in Business Awards, and Blued was shortlisted. In December 2017, Geng Le was selected for the 2017 Global Thinkers list published by the US Foreign Policy magazine.

Before the IPO, Blue City Brothers Media held a 37% stake, Shunwei Capital held a 12.3% stake, CDH Investments held a 9.4% stake, and Tianze Taurus held a 7.6% stake; Qingliu Capital held a 5.7% stake, NewCity Capital held a 5.1% stake, and Rayway Capital held a 4.4% stake.

As of the first quarter of 2020, BlueCity Brothers' cash and cash equivalents and time deposit balances were 363 million yuan.

via Leidi Touch Network