Investors are taking a second look at China’s high-value startups such as smartphone maker Xiaomi, which is now facing growing pressure to live up to high expectations.
Xiaomi missed its 2015 sales target: they estimated 80 million smartphones shipped, but they weren’t capable of growing that fast and that much. They haven’t surprised us as before, and now the pressure from investors seems to be pretty high.
That’s reasonable, and maybe Xiaomi’s valuation was overestimated. But its business is done in quite the right way -let’s forget the design similarities with Apple-, so we should take that into account.
I can’t help but compare this company with Uber or Airbnb, which certainly offer us really good alternatives on their segments, but at the cost of companies that work according to the current regulation. Until that regulation covers that kind of ‘sharing economy‘ (great euphemism), they are doing something that could be (or has been) considered a fraud in many countries.
Unfair comparison, and unfair valuations anyway.