A popular nuts and snacks e-commerce retailer Three Squirrels, backed by IDG Capital Partners and Chinese private equity firm Capital Today, is reportedly seeking an A-share listing with the help of China International Capital Corporation (CICC), according to Chinese media reports.
The company is still in the early stage of its IPO process, and no financial details have been determined.
Founded in 2012, Three Squirrels recorded RMB2.5 billion (US$383 million) in sales last year and is the largest snacks retailers on Alibaba's Taobao and TMall e-commerce platforms.
The company received US$1.5 million series A funding from IDG Capital at the time of its establishment.
In 2013, it received US$6.17 million series B round from IDG Capital and Capital Today.
In 2014, IDG and Capital Today invested RMB120 million (US$18.4 million) in a series C round, according to the company's website.
Last year, the company received RMB300 million (US$46 million) series D from Frees Fund, a venture firm established by two former IDG Capital partners, Li Feng and Lin Ben.
China's nuts market reached RMB55.6 billion (US$8.3 billion) in 2014, of which only 7% were sold online. The proportion of online sales will grow rapidly in the future as more consumers move to shop online.
But there are unique challenges for companies like Three Squirrels while seeking a public listing.
One thorny issue is recognition of revenue. Companies that operate on third-party e-commerce platforms often operate as personal businesses in the beginning without corporate bank accounts.
Three Squirrels will also need to provide verification that all of its online sales are authentic.
To assist the IPO process of online brands born out of its retail platforms, Alibaba's TMall platform established an office last month to help these companies on their path of becoming a public company.