This Chinese start-up's 47-page IPO risk disclosure lists lack of proper licenses and Ebola virus
Shanghai-based Qutoutiao, a company backed by Tencent, operates a mobile app that aggregates Chinese news and short videos
Tencent Holdings-backed Qutoutiao, operator of a mobile app that aggregates Chinese news and short videos, may have raised some red flags even as the company looked to attract investors for its proposed US$300 million initial public offering (IPO) in the United States.
Shanghai-based Qutoutiao, whose name means “fun headlines”, revealed those concerns as part of the mostly boilerplate clauses in its 47-page-long risk disclosure contained in a prospectus published on Friday.
The company said it was currently doing business without the proper government licences; incurred losses since it was founded in 2016; and concerned about being adversely affected by the effects of the Ebola virus and other infectious disease outbreaks.
While its platform primarily focuses on light entertainment content, Qutoutiao said in its prospectus that certain content related to current affairs, finance, society and economy may be deemed to be news content, which is regulated by the Cyberspace Administration of China (CAOC).
“We are in the process of preparing an application for an internet news licence,” the company said. But it offered “no assurance that our application will be accepted or approved by the regulatory authorities”.
