Looking pretty is big business in China. App So-Young International, which connects beauty seekers and surgeons, raised $179m listing in the US last week. The shares ended the week up 50 per cent over its IPO price, giving the company a value of $2bn. The Chinese nip and tuck market looks a good bet.
Unlike many tech unicorns, So-Young is profitable. Net income was $8.2m on sales of $92m last year. Revenues have grown at a compound annual growth rate of more than 200 per cent over the past two years. Costs are low. Marketing and server fees take the lion’s share.
The business model is simple. Two-thirds of revenue comes from providing ads on its platform. The rest comes from reservation services. So-Young gets a tenth of whatever the cosmetic surgeon makes when a booking is made through it. That could mean even bigger profits for investors.