As Groupon squirms uncomfortably in China, Forbes’ Gady Epstein profiles the man behind one of the group-buying site’s highest-grossing Chinese replicants, as well as a string of other high-profile web clones.
Wang Xing was 26 years old and already the founder of a failed Chinese takeoff of oncehot Friendster when he cloned Facebook. It was December 2005 in Beijing, and Wang and two friends had made an excellent copy. Xiaonei would quickly become the most trafficked Chinese version of Facebook, but less than a year in, forced to borrow money from his parents to keep it going, Wang sold his first success for several million dollars.
He and other friends next copied Twitter. Fanfou would become China’s highest-profile Twitter clone, but it was taken off line by the government after the Xinjiang riots of July 2009 and would not return for more than a year. Meanwhile Xiaonei flourished under its new owners and its new name, Renren; it will soon be valued at more than $4 billion in a highly anticipated U.S. IPO.
Undaunted, Wang and his Fanfou friends cloned again, launching Meituan, a copy of the crowd-discounting business Groupon, in March 2010. It is one of the two highest-grossing Chinese Groupon clones, with more than $12 million a month in coupon sales, Wang says, and is on the verge of closing a $50 million-plus round of funding with investors such as Sequoia.
Meituan is Wang’s best chance to cash in big on a career of duplication. But to make it, ironically enough, he will first have to defeat an armada of fellow clones, an estimated 3,000 Chinese group-discounting businesses that have sprung up in just one year in cities all over the country, including up to a dozen strong national competitors.
While Renren’s IPO may value it at a thousand times what Wang received, iChinaStock.com (via Bill Bishop) reports that the social network’s future remains uncertain:
The social networks in China are feeling the pressure. Wei Guo, Vice President of Kaixin001, admitted to a reporter that his website’s traffic volume was declining. However, Renren disclosed that their traffic volume “was not decreasing as much as Kaixin001’s.”