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Chinese smartphone maker Xiaomi raises $216 million in new funding, looking to spread MIUI-based devices

While Xiaomi is not lacking funding, can they compete with the major players in the smartphone industry?
June 26, 2012
xiaomi phone

We’ve talked time and again over the past few months about the “Chinese offensive” on the global smartphone market, led by companies like Huawei, ZTE, Alibaba and Baidu. However, it seems that there are even more Chinese tech manufacturers looking to make it big in an Apple and Android dominated world, and some of the smaller ones, like Xiaomi, are growing in leaps and bounds.

Xiaomi is not very well-known in the Western world, and even in China, Xiaomi is hardly a household name. However, the name of the 2-year old company may ring a bell for some of you, with its claim to fame being  the MIUI custom Android ROM and the MIUI-based MI-One smartphone released last fall.

MIUI is, of course, a skinned version of Android, and the app-centric MI-One has certainly drawn some attention with the affordable price point (around $320) and some decent hardware (a 1.5 GHz dual-core processor and 1 GB of RAM, among others).

According to official statements from Xiaomi, their first ever smartphone has been met with much enthusiasm in China, selling around half a million units each month for the past half a year. However, the company needed significant financial support to be able to develop other products, which is why it recently asked for a round of external funding.

The company’s founder and CEO, Lei Jun, has now announced that the latest funding round has been completed and that his firm will receive $216 million, to be used for further research and development. Jun wasn’t keen to disclose his new backers’ identities for the time being, but we should find out more details about them in the coming weeks.

This latest series C funding round is the third such financial backing received by Xiaomi since its inception back in 2010.  The first two deals brought the company a total of $131 million from Qiming, IDG, Qualcomm, MorningSide and Temasek. Xiaomi’s exact plans for the latest financial support are unknown, but Bin Lin, the company’s president, stated that “we are not looking to make any money, or to make Xiaomi profitable, for the next two or three years.”

Do you think Xiaomi has what it takes to become an important “player” in the global smartphone market?