Insta360’s IPO Journey: From Tech Geek to Global Market Leader of action camera
After submitting its IPO prospectus in 2020 and facing repeated rejections, even considering a Hong Kong listing at one point, Insta360 finally made its debut on China’s SSE STAR Market on June 11, 2025, trading under the ticker “688775.” The company’s founder, Liu Jingkang, born in Zhongshan, Guangdong, and a graduate of Nanjing University, became legendary in tech circles for decoding Zhou Hongyi’s phone number by analyzing the keypad tones during a TV interview. This kind of technical acumen and keen instinct may well be the DNA that later enabled Insta360 to dominate the global panoramic camera market.
Insta360 ranks #1 globally in action camera sales, becoming the gadget for a new generation of outdoor enthusiasts.
Over 70% of Insta360’s annual revenue comes from overseas markets, primarily the US, Japan, and Europe — making it a successful case study for Chinese brands going global. In the cutthroat red ocean of consumer electronics, Insta360 has carved out a profitable niche in international markets through technological premium positioning.
Let’s dive into Insta360’s sales model, equity structure, and IPO details by analyzing their prospectus.
I. Sales Model
- Online Sales
Official Website: The official store represents private domain traffic, with nearly 20% of Insta360’s revenue (including offline direct sales) coming from private channels — proof that the brand has built a genuinely loyal fanbase. This 20% private domain traffic share is remarkably rare among hardware companies, indicating that Insta360 isn’t just selling products — it’s cultivating a brand community.
Third-party E-commerce Platforms: Major domestic and international online platforms like Amazon, Tmall, and JD.com. For Amazon, customers place orders through the platform, Insta360 ships products to Amazon’s designated warehouses via international logistics, and Amazon handles warehousing and final delivery. Anyone who’s done cross-border e-commerce knows that Amazon success is 70% product selection and 30% operations — products with strong appeal naturally attract organic traffic.
Platform Direct Sales: Insta360 sells directly to platforms like JD Direct, Suning, and Amazon Direct, where the platforms handle all sales functions. This is the most comfortable model for sellers but most demanding for platforms, so volumes are typically lower.
- Offline Sales
2.1) Offline Distribution — Buy-out Model:
How to Develop Distributors:
Primarily through industry trade shows like CES and IFA, online research, cold calling/visits, and referrals from existing contacts.
Distributor Qualification Criteria:
· Independent corporate legal status with proper business registration documents (tax registration acceptable as alternative), independent business premises, and ability to conduct business independently
· Proven experience in consumer electronics sales with local market presence and reputation, plus good commercial credit
· Strong financial capacity, sales channels aligned with company products, and positive cooperation attitude
Distributor Management:
Discount and Rebate Policies: The company considers distributor location, purchase volume, and sales channels when setting discount rates off retail prices. Domestic distributors typically receive 20–25% discounts, while overseas distributors get 20–35%.
These discounts are relatively generous since they’re off retail prices. For example, if a distributor needs a 20% gross margin and the retail price is ¥1,000, their minimum purchase price would need to be ¥800, making Insta360’s effective discount rate 200/800 = 25%.
These policies are all based on sell-in arrangements, suggesting fast channel inventory turnover without need for sell-out policies.
The top five customers in 2024 show no single customer accounting for over 5% of company revenue — an extremely healthy channel structure that’s textbook-level diversification among hardware companies, avoiding the risk of being held hostage by major clients.
- Payment Terms
Payment terms reveal a company’s bargaining power with channel partners.
Direct sales require payment before shipment from end consumers; platform direct sales with 90-day terms might be negotiable down to 60 days given Insta360’s product strength.
Most buy-out arrangements use telegraphic transfer (TT), demonstrating strong channel control power — indicating Insta360 has solid negotiating position in the supply chain rather than being a weak manufacturer pressured by channel partners.
II. Equity Incentive Structure
- Controlling Shareholder Structure
The second-largest shareholder is EARN ACE, wholly owned by IDG. IDG Capital was the earliest angel investor, investing millions when Liu Jingkang was still at Nanjing University with a six-person team, no products, and no business model. They never reduced their holdings and now have paper gains for billions in the post-IPO. This is the magic of angel investing — bet right on an idea, and you’ve bet right on an era.
Founder Liu Jingkang indirectly holds 29.9% of the company through Beijing Lanfeng, Lanfeng Management, Lanfeng Management, Lanfeng Management, Xiamen Fukai, Huizhi Tongyu, and Shenzhen Maigao, making him the actual controller. This multi-layered structure creates leverage effects.
Beijing Lanfeng is an LLC where Liu Jingkang holds 79.6%/¥9.3 million. Beijing Lanfeng holds 29.9% of Insta360, appointing 4 of the 9 board directors and nominating 3 independent directors. Liu Jingkang effectively controls a ¥68 billion company with just ¥9.3 million — this is the elegance of capital structure design, using minimal capital to leverage maximum control.
- Employee Equity Incentives
Lanfeng Management, created for employee equity incentives, is structured as a limited partnership.
In partnerships, General Partners (GP) are actual operators bearing unlimited liability for partnership debts, while Limited Partners (LP) only contribute capital without operational involvement.
Using partnerships instead of LLCs for employee equity reduces tax burden. With an LLC structure, distributing ¥100 requires the LLC to pay 25% corporate income tax, leaving ¥75 subject to 20% individual income tax, netting employees ¥60. With partnership structure, only individual tax applies, netting employees ¥80.
Employees don’t hold shares directly as natural persons because it’s cumbersome — under Company Law, when LLCs convert to joint-stock companies, each share gets equal voting rights. Oppein Home (603833) experienced efficiency issues during restructuring due to numerous natural person shareholders needing to sign legal documents. Anyone who’s dealt with corporate paperwork understands the pain.
III. IPO Pricing Methodology
IPO pricing uses three main methods: P/E ratio method, P/B ratio method, and competitive bidding.
The P/E method multiplies earnings per share by comparable companies’ market P/E ratios. Like selling a house — you tell buyers this property rents for ¥3,000/month (earnings per share), typical domestic rent-to-price ratios suggest 50-year payback periods (P/E ratio), so fair house price = ¥3,000 × 12 × 50 = ¥1.8 million.
The P/B method multiplies net assets per share by comparable companies’ market P/B ratios. Like partnering on a bubble tea shop — equipment and supplies worth ¥100,000, owing suppliers ¥20,000. In tough economic times with uncertain monthly revenue, hoping for 3-year payback: net assets (¥100,000-¥20,000) × expected payback period 3 years = ¥240,000 total valuation.
Insta360 used the P/E method: Issue price = Earnings per share × Issue P/E = ¥2.36 × 20.04 = ¥47.27. Using pre-issue net assets per share: Issue price = ¥8.84 × 20.04 = ¥177.15.
Insta360 opened at ¥47.27 on day one, surged during trading, and closed at ¥177 — suggesting the P/B method better matched market expectations. The market voted with its feet, showing investor valuation of Insta360 far exceeded underwriters’ conservative pricing.
IV. Issuance Costs
Insta360 spent ¥190 million on IPO costs, representing 9.8% of funds raised.
According to online statistics, among 100 newly listed companies in 2024 in Mainland China, issuance costs ranged from minimum ¥11.363 million to maximum ¥238 million, with cost ratios from 1.64% to 24.48%. Insta360’s costs fall around the median.
Underwriting fees represent the highest IPO cost component — Insta360 paid ¥155 million/8%, still higher than US rates.
Underwriters earn their fees by finding institutional investors and executing the entire listing process. Underwriting comes in two forms: firm-commitment underwriting and best-efforts underwriting. For example, if crowdfunding ¥1,000 for a Pop Mart figure only raises ¥800: firm-commitment underwriters would cover the ¥200 shortfall; best-efforts underwriters would walk away.
Regardless, 10% fees aren’t cheap. Is there a way to reduce costs? Yes — through direct listing.
Direct listing bypasses underwriters entirely, putting existing shares directly onto stock exchanges for trading.
Direct listing benefits include cost savings (no middleman markup), market-determined pricing (supply and demand, not underwriter pricing), and free trading (no IPO lockup restrictions for original shareholders and employees). Downsides include potentially less investor attention without prestigious underwriter backing, and inability to raise new capital — only suitable for converting private to public companies. Direct listing works best for highly recognizable companies that don’t need capital, like Spotify .
Conclusion: A Tech Geek’s Capitalization Journey
From the tech nerd who decoded Zhou Hongyi’s phone number to the global leader in panoramic cameras, then to STAR Market entrepreneur, Liu Jingkang and Insta360 have followed a classic “technology-product-capital” triple-jump trajectory.
Insta360’s success isn’t just about one product — it’s a benchmark case for Chinese hardware companies going global. In consumer electronics, Chinese companies often get trapped in price wars, but Insta360 established itself in overseas premium markets through technological differentiation.
Technology can change the world, but only capital can amplify technology’s value.
In this era, even pure tech geeks must learn to dance with capital to truly transform from lab to market, from product to platform.