Chinese cybersecurity probe validates Didi's pre-IPO warning to investors

Welcome to Extra Crunch Friday

Yesterday, China ordered ride-hailing company Didi to stop signing up new customers after regulators announced a cybersecurity review of the company’s operations.

As of this writing, Didi’s stock price is down 7.23%. In today’s edition of The Exchange, Alex Wilhelm suggests that the move isn’t a complete surprise, but it still “puts a bad taste in our mouths,” since the company debuted only days ago.

When Didi filed to go public, it listed several potential pitfalls facing Chinese companies that go public in the U.S., including “numerous legal and regulatory risks” and “extensive government regulation and oversight” in its F-1.

What does this news signify for other Chinese companies that are hoping for stateside IPOs?

We’ll be off on Monday, July 5 in observance of Independence Day. Thanks very much for reading, and I hope you have an excellent weekend.

Walter Thompson
Senior Editor, TechCrunch
@yourprotagonist

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