Oak Pacific Interactive buys social network, Xiaonei.com
Amit Chowdhry | Tuesday October 24, 2006 | 923 Views |Categorized under Facebook, M&A, Oak Pacific Interactive, Xiaonei
Oak Pacific Interactive (OPI), a Chinese Internet business group has announced today that they are acquiring Xiaonei.com, a Chinese leading college social network website. Xiaonei is the Chinese word for “on campus.” The plan is to merge Xiaonei’s users and interface with OPI’s social network, 5Q. Xiaonei will be added to a family of other OSI websites, Mop.com (entertainment portal), DoNews.com (news website), UUMe.com (Chinese clone of YouTube), and RenRen.com (classifieds).
Xiaonei is a Chinese version of Facebook as you can tell by the below screenshot:
Even though the acquisition details were not listed, the OPI CEO Joseph Chen stated that as far as competition, “There are still 20 smaller players out there [source].” “It wasn’t a cheap deal,” stated James Liu, the co-Chief Operating Officer of OPI. “We paid a premium, but the team deserves it.”
Xiaonei was created by Tsinghua University graduate, Wang Xing about one year ago. Liu stated that Xiaonei was pursuing various venture capitalists before OSI made a bid that Xiaonei couldn’t refuse. Xiaonei was backed by angel investors, money from Wang’s family, and by an ex-CTO of Amazon.com
In regards to its Facebook interface replication, Red Herring reports, “Xiaonei has come under fire from some Chinese users for its uncanny resemblance, both in form and function, to the popular Facebook.com. But that’s not something Mr. Liu’s losing sleep over—not when Xiaonei can deliver close to a million active users in one of China’s most sought after demographic groups [source].”
In a similar approach that Mark Zuckerberg used in the initial phase of Facebook in the U.S., Wang also made the social network exclusive to major univerisites in China such as Tsinghau University, Peking University in Beijing, and Fudan University and Jiaotong University in Shanghai. Xiaonei quickly grew to over 1 million users.
I believe that it is rather unfortunate that Xiaonei, a complete Facebook replica was sold. This may encourage others to steal design interfaces from other popular websites and attempt to sell them abroad.
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