Shein Global Holdings Ltd. is set to go public in Hong Kong on Tuesday at just over a quarter of the $100 billion valuation it commanded in 2022, according to Bloomberg. At that price, founder Sky Xu's 30% stake falls to roughly $8 billion, down from a net worth of more than $23 billion at the company's peak, per the Bloomberg Billionaires Index.
The more than $15 billion decline reflects several forces converging at once. Xu's fortunes have turned over four years as Shein battles tariffs, political scrutiny and growing competition, the company's circumstances show.
One of Shein's key strategies — sidestepping import taxes in the US and Europe through small shipments — was upended last year when the Trump administration ended a key tariff exemption and the European Union announced a fixed customs duty on small parcels, according to the report.
Timing has also worked against the company. A string of artificial-intelligence firms making their market debuts has stolen the spotlight from Chinese consumer brands, minting new billionaires and drawing investor attention away from e-commerce, according to Sam Wyatt, an international-equities portfolio manager at U Ethical Investors. 'They definitely missed the window,' Wyatt said of Shein's IPO.
The broader Hong Kong IPO market has been mixed. Shares of beverage maker Eastroc Beverage Group Co. and pig breeder Muyuan Foods Co. are both trading below their listing prices after debuts exceeding $1 billion, and the founders of bubble-tea chain Mixue Group have seen their wealth shrink by more than a fifth since going public last year.
Sheng Lu, a professor of fashion and apparel studies at the University of Delaware, said the direction of the market has shifted against Shein, and that AI is also leveling the playing field for competitors who can respond faster to changing consumer tastes.
Xu, 43, started Shein in 2012 with three partners who had worked together at a search-engine marketing company. The business flourished during the Covid-19 pandemic as young shoppers fueled a sales boom, but revenue growth has slowed since, according to data Shein disclosed in July ahead of the IPO.
Shein tried to go public during its heyday but struggled to gain traction in New York and London amid scrutiny over its labor practices. The company's supply chain is rooted in China, but it relies on the US and Europe as key markets and moved its global headquarters to Singapore — though it still needed Chinese regulators' approval to list. 'Shein was the hottest topic two to three years ago,' said Jason Hsu, chief investment officer at Rayliant Global Advisors. 'But the hot topic now is AI.' A Shein spokesperson did not respond to a request for comment.
The market has already voted, and the verdict is unforgiving. A business model partly built on a customs gap now has to prove it can compete on product and margins alone, with investors free to reward whichever story — AI or fast fashion — offers clearer growth. Xu's paper losses are a reminder that capital moves toward the sharpest opportunity, not sentiment, and that political and regulatory shifts abroad carry real costs for the foreign firms that built their models around avoiding them.
