Xiaohongshu

When last year American users flooded into Xiaohongshu, escaping uncertainty around TikTok, many in the West heard this name for the first time. In Chinese internet culture, however, RedNote (as the platform is known outside mainland China) has long been far from a discovery. For several years now, it has been a way of life for hundreds of millions of people—a place where questions are answered more effectively than in search engines, and where purchases happen more spontaneously than on any marketplace.

Now this story is entering a new stage. According to the Wall Street Journal, Xiaohongshu is preparing for an IPO in Hong Kong at a valuation of over $70 billion. This is not just a number in a headline. It signals that China’s social commerce sector has matured enough to go public, and that investors are willing to pay serious money for it.

Let’s break down what is behind this decision, why the valuation is controversial, and what this platform actually is—one that many in the West still casually call “the Chinese Pinterest,” repeatedly missing the point.

Founded in 2013, Xiaohongshu started as a modest shopping guide for Chinese women traveling abroad. Its founders, Miranda Qiu and Charlene Chen, could hardly have imagined that a dozen years later their creation would be valued at nearly $70 billion and considered one of the key assets of China’s internet economy.

Today it is not just an app—it is an ecosystem with more than 400 million monthly active users. For comparison, that is more than the population of the United States. And this is not an anonymous mass: each user comes with intent—seeking advice,...