TikTok refugees flock to Chinese RedNote as US ban looms

New users have piled in to Chinese social media app RedNote just days before a proposed U.S. ban on the popular social media app TikTok, as the lesser-known company rushes to capitalize on the sudden influx while walking a delicate line of moderating English-language content, sources told Reuters.

In a live chat dubbed “TikTok Refugees” on RedNote on Monday, more than 50,000 American and Chinese users joined the room.

Veteran Chinese users, with some sense of bewilderment, welcomed their American counterparts and swapped notes with them on topics like food and youth unemployment.

Occasionally, however, the Americans veered into riskier territory.

“Is it ok to ask about how laws are different in China versus Hong Kong?” one American user asked.

“We prefer not to talk about that here,” a Chinese user responded.

Such impromptu cultural exchanges were taking place all across RedNote, known in China as Xiaohongshu, as the app surged to the top of U.S. download rankings this week. Its popularity was driven by American social media users casting about for an alternative to ByteDance-owned TikTok days ahead of its looming ban.

In only two days, more than 700,000 new users joined Xiaohongshu, a person close to the company told Reuters. Xiaohongshu did not immediately respond to a request for comment.

US downloads of RedNote were up more than 200% year-over-year this week, and 194% from the week prior, according to estimates from app data research firm Sensor Tower.

The second most-popular free app on Apple's AAPL.O App Store list on Tuesday, Lemon8, another social media app owned by ByteDance, experienced a similar surge last month, with downloads jumping by 190% in December to about 3.4 million.

The influx appeared to catch RedNote by surprise, with two sources familiar with the company telling Reuters they were scrambling to find ways to moderate English-language content and build English-Chinese translation tools.

RedNote maintains only one version of its app, rather than splitting it into overseas and domestic apps - a rarity among Chinese social apps that are subject to domestic moderation rules.

Still, the company is keen to mine the sudden rush of attention, as executives see it as a potential path to achieve global popularity similar to TikTok's.

RedNote, a venture capital-backed startup with a most recent valuation of $17 billion, allows users to curate photos, videos and text documenting their lives. It has been viewed as a possible IPO candidate in China.

In recent years, it has become a de facto search engine for its 300 million-plus users looking for travel tips, anti-aging creams and restaurant recommendations.

The share prices of some China-listed companies that conduct businesses with RedNote, such as Hangzhou Onechance Tech Corp 300792.SZ, surged as much as 20% on Tuesday, hitting the daily limit.

The spike in U.S. users comes ahead of a Jan. 19 deadline for ByteDance to sell TikTok or face a ban in the U.S. on national security grounds.

TikTok is currently used by about 170 million Americans, roughly half of the country’s population, and is overwhelmingly popular with young people and the advertisers looking to reach them.

"Americans using Rednote feels like a cheeky middle finger to the U.S. government for its overreach into businesses and privacy concerns,” said Stella Kittrell, 29, a content creator based in Baltimore, Maryland.

She said she joined RedNote in hopes of further collaborations with Chinese companies which she found helpful.

Some users said they joined the platform to seek alternatives to Meta Platforms META.O-owned Facebook and Instagram, and to Elon Musk’s X. Some expressed doubt that they could rebuild their TikTok follower base on those apps.

“It’s not the same: Instagram, X, or any other app,” said Brian Atabansi, 29, a business analyst and content creator based in San Diego, California. “Mainly because of how organic it is to build community on TikTok,” he said.

Here are some details about the app:

What is this app

RedNote is often regarded as a localised adaptation of Instagram in China. Its Chinese name Xiaohongshu translates to "Little Red Book" in English, a phrase which traditionally refers to a collection of sayings by Chinese Communist leader Mao Zedong.

It is widely regarded as the go-to search engine these days in China for recommendations and the most popular topics on the app span beauty, fashion, travel and food. Its users in China are mostly young and female.

Its interface is different from TikTok or Instagram in that it displays multiple posts - either video, photos or longer-form texts - simultaneously.

Users are able to engage in discussions, share their posts, call each other and purchase products. The platform has recently been making a big push into livestreaming sales.

As of 2023, it had more than 300 million monthly active users, according to Chinese media reports.

Who owns RedNote?

The app was co-founded by Miranda Qu, its current president, and Charlwin Mao, its CEO, in 2013 in Shanghai. They initially called the app "Hong Kong Shopping Guide" and targeted Chinese tourists looking for recommendations outside the mainland.

RedNote is viewed as a potential IPO candidate. Shareholders include Chinese tech giants Alibaba 9988.HK and Tencent 0700.HK, Singapore state investor Temasek as well as venture capital firms GSR Ventures, DST Global, and GGV Capital.

Mao has personal wealth of some 18 billion yuan ($2.5 billion) while Qu has a fortune of 12 billion yuan, according to China's Hurun rich list.

Does it have global ambitions?

The app is mainly used by Chinese people and while users have the option to change the app's language, most of the content to date has been in Mandarin.

The influx of TikTok users has appeared to catch RedNote by surprise. Two sources familiar with the company said they were scrambling to find ways to moderate English-language content and build English-Chinese translation tools.

RedNote maintains only one version of its app, rather than splitting it into overseas and domestic apps. In contrast, Tencent runs overseas and domestic versions of its WeChat app while ByteDance also has a version of TikTok for mainland China called Douyin, in part to comply with Chinese government moderation rules.

The company is keen to mine the sudden rush of attention, as executives see it as a potential path to achieving global popularity similar to TikTok's, the sources said. RedNote did not respond to a request for comment.