When most people could not imagine breaking Alibaba’s stronghold in China’s e-commerce market, Huang Zheng, also known by the English name Colin, decided to have a go with his app Pinduoduo. Having already leapfrogged JD.com in terms of daily active users, the three year-old firm has emerged as a legitimate challenger to Alibaba’s market-leading position. That’s set Huang on the path to becoming one of the 25 richest people in China.
Huang was born in 1980 in a rural area of Hangzhou, coincidentally the same city where Jack Ma’s Alibaba was founded. Both his parents were factory workers and neither were educated beyond junior high school. Huang, on the other hand, was a wunderkind with a flair for solving complex mathematical problems. A medal won at the Mathematical Olympiad earned him a place at the Hangzhou Foreign Languages School, one of the top schools in Zhejiang province. He was so gifted he was given a waiver to enter Zhejiang University without taking the national university entrance exam. He later studied computer science at the University of Wisconsin-Madison. Upon graduation in 2004, he was offered jobs by IBM, Microsoft and Oracle.
Huang, having interned at Microsoft, did not choose any of these established titans. Instead he went to Google and applied for a job at the then lesser known search upstart. “I’d have had very little influence over what was going on at Microsoft and I could imagine who I would be six years down the road,” Huang explained to Bloomberg. He stayed at Google for three years, first as a software engineer, then product manager, and finally as a member of the Lee Kai-fu’s team helping Google build its China business. Joining the search company six months before its initial public offering, Huang saw the value of his stock options multiply from $85 per share to $500, giving him the financial freedom to strike out on his own in 2007.
Huang started three companies before founding Pinduoduo in Shanghai. The first was an e-commerce platform for electronic goods, the second a service for online mom-and-pop stores. Later he moved on to create online role-playing games targeting WeChat users. Apart from boosting his wealth, these experiences inspired him to create a new model in e-commerce: integrating social media seamlessly into the experience of online shopping. By making deals that require multiple buyers to obtain bargain prices, and embedding its apps on WeChat (so that a buyer can make pitches to friends and relatives instantaneously), Pinduoduo quickly went viral, especially among more price sensitive users in lower-income cities (see our company profile in WiC404). Its gross merchandise volume jumped 9.5 times on the year to Rmb198.7 billion ($29.4 billion) in the first quarter. And with Tencent and Sequoia China as backers, Pinduoduo saw its flotation in New York more than 13 times oversubscribed and priced at the top of its range. It raised $1.63 billion – achieving a market valuation of $28 billion after it surged 35% on its open on Thursday – adding $11.2 billion to Huang’s net worth.
Need to know
One of Huang’s skills: to assemble a network of ‘great’ friends. These include NetEase’s Ding Lei, SF Express’s Wang Wei, and most notably, BBK Technologies Duan Yongping (see WiC409). Duan held Huang in such high regard that he reportedly took the then 26 year-old with him to his $620,100 charity lunch with Warren Buffet in 2006.
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