Editor’s Note: This article is from the WeChat public account “IPO early know” (ID: ipozaozhidao), author Uncle C, 36 is authorized to publish.According to the IPO, the NetEase’s Education Department’s “Netease has a good way” plan will start a pre-road show to the US next week, raising at least $300 million.Morgan Stanley and Citigroup will be the lead underwriters for this IPO.In July this year, Bloomberg reported that Netease had the earliest possible application in the next few weeks.According to Netease’s well-planned plan, it will be officially handed out before the end of September, and the process will be completed in early October at the latest.Netease has a “no comment” on listing matters.At the beginning of this year, Netease CEO Ding Lei proposed that “games, e-commerce, education, music” will be the four major strategies of NetEase, which is the first time that education has been included in the group strategy.It is worth noting that the last three of the above four strategies for completing independent financing have undergone major changes during the past period.Among them, Netease’s cross-border e-commerce “Koala Haigao” was purchased by Alibaba for $1.7 billion in cash plus 1.8 million ADS (about $300 million), while Alibaba invested another $468 million in cash and clouds.Feng Fund led the $700 million B2 round of financing for Netease Cloud Music.Today, Netease’s well-established listing plan is also speeding up again.NetEase is the Internet education brand of Netease, which includes NetEase’s dictionary, a quality class, a translator, a Daoyun notes and other popular education tools and online learning products.If the IPO is successfully completed, it will also become the first independent listed division of NetEase.In addition, at almost the same time when the education business was given more strategic significance, Netease’s CEO Zhou Feng confirmed that the original Netease Education Products Division was merged into Netease, and the latter was responsible for the education business. “The key words for the future areFocusing on K12″, which to some extent indicates that NetEase’s independent IPO is also a matter of course.On April 17 last year, NetEase announced that it had completed the first round of strategic financing. Muhua Investment led the investment, and Junlian Capital participated in the investment, with a post-investment valuation of US$1.12 billion.At that time, Zhou Feng said that Netease has a future and does not rule out direct listing.According to official data, NetEase has more than 800 million users and more than 17 million daily active users.The first large-volume product is a dictionary, with more than 700 million users at the beginning of this year.In terms of revenue, in 2017, the revenue of quality courses increased by 530% year-on-year, and the number of students exceeded 3 million. In 2018, Netease’s revenue increased by 60% year-on-year, K12 paid users increased by 5 times, and K12 business revenue increased by 3 times.In 2019, the proportion of course income in total revenue has exceeded 50%.In order to enrich its income source, NetEase has also launched intelligent software such as translation king, translation egg, dictionary pen, and cloud platform services such as cloud notes, cloud collaboration, cloud collaboration lite, etc., aiming to tell a more make sense.s story.NetEase’s latest financial report shows that in 2019, Q2 NetEase revenue was 18.77 billion yuan, up 15.3% year-on-year; net profit was 3.07 billion yuan, up 45.8% year-on-year.Among them, the revenue of the e-commerce business increased by 20.2% year-on-year, the gross profit margin was 10.9%, which still had a large gap with the overall gross profit margin of 43.3%, while the gross profit margin of the innovation and other business segments turned positive to 1.4%, includingNetease has a way.Nowadays, after the cross-border e-commerce business with the market share in the industry is “selling” to Alibaba, education has become the new business growth point of Netease without any dispute.From another point of view, education is also the smallest gap between Netease and the “super giant” in the reality that e-commerce is not as good as Ali, games are not as good as Tencent, and advertising is not as good as Baidu and byte beating.Among them, Ali has the least appeal to the profit of education. The public welfare and social influence seem to be more concerned by “Mr. Ma” and Ali. Tencent has always chosen investment as the main investment, including VIPKID, VIP sparring, and 猿Counseling and other unicorn companies; Baidu has put heavy emphasis on the homework, Baidu Education Division, which was established in late 2015, was officially revoked in May.In contrast, bytebeat has greater ambitions and desires in the field of education, but how to transform from a focus-oriented product to a tool-oriented product that is more suitable for education, Zhang Yiming may need more thinking.In any case, NetEase has a sufficient user base and a clear business closed loop. The next step is to see how it tells investors a more imaginative listing story..
Netease has a way to go public in the US and will openly submit the form: the amount of funds raised is at least 300 million US dollars.