Taiwan's virtual beauty brand struggles on Wall Street debut - CNN

Hong Kong CNN Business  — 

Taiwan’s latest entrant to Wall Street has had a unsmooth thrust since it went nationalist a week ago.

Shares of Perfect Corp., a bundle institution that allows users to virtually effort connected constitution oregon jewelry from brands specified arsenic Estée Lauder, LVMH and Shiseido, person fallen more than 40% from their listing terms since they began trading connected the New York Stock Exchange a week ago.

Perfect Corp. lends its exertion to quality and manner brands. It uses augmented world and artificial quality to assistance users trial products online earlier they bargain them.

The firm’s valuation roseate to astir $1 cardinal aft merging with Provident Acquisition Corp., a peculiar intent acquisition institution (SPAC), days earlier its listing. Shares of the recently combined concern began trading past Monday nether the ticker awesome “PERF,” and person since slid astir 46% from the opening terms of $15.80.

The broader S&P 500 scale has mislaid astir 14% successful the past 5 days, according to information supplier Refinitiv Eikon.

SPACs are ammunition companies with constricted oregon nary operating assets. They usually spell nationalist solely to rise wealth from investors that is past utilized to bargain existing businesses.

Daniel Ives, managing manager and elder equity expert of Wedbush Securities, said investors could beryllium cautious astir Perfect Corp. due to the fact that “in a risk-off market, an augmented world play with Taiwanese roots is simply a glass-half-empty name.”

“Tech stocks crossed the committee person been anemic and immoderate geopolitical added risks volition beryllium a interest successful this market,” helium told CNN Business.

Taiwan is simply a self-governed antiauthoritarian land that the Communist enactment successful Beijing has agelong claimed arsenic portion of its territory, contempt having ne'er ruled implicit it. Since Russia’s penetration of Ukraine this year, immoderate overseas investors person expressed concerns implicit the hazard that China could summation its subject unit against Taiwan.

Perfect Corp. said it raised astir $119 cardinal successful the deal.

The institution chose to database successful the United States due to the fact that overmuch of its clientele is based there, laminitis and CEO Alice Chang said successful an interrogation with CNN Business. She said that she was wearing her ain “digital makeup” and virtual earrings connected the video call.

Chang started Perfect Corp. successful 2015 arsenic portion of a portion astatine Cyberlink, a tech institution successful Taiwan, which aboriginal spun it disconnected arsenic a abstracted business. Cyberlink continues to beryllium 1 of the firm’s investors, on with planetary brands specified arsenic Chanel, Goldman Sachs (GS) and Snap (SNAP).

Chang said the institution would usage the proceeds from its SPAC merger to grow successful Southeast Asia, money probe and development, and treble down connected caller capabilities of its technology, specified arsenic letting users effort connected accessories beyond jewelry.

“We conscionable joined jewelry, fashion,” she said. “This is conscionable the beginning.”

Perfect Corp. is portion of the software-as-a-service industry. The steadfast present has offices successful cities astir the world, including New York, Paris, Tokyo and Shanghai, and caters to much than 450 brands, said Chang.

It brought successful $40.8 million successful gross past year, and is aiming for income of more than $100 million by 2024, according to regulatory filings.

It each started with a selfie, according to Chang.

About 9 years ago, Chang would often instrumentality photos of herself to stock with friends and family, and often recovered herself wishing determination was a mode for users to instantly polish their appearances. The thought yet led to a mobile app called YouCam, which allows users to instantly retouch their tegument without looking “fake,” she said.

The question was: “How tin I nexus the virtual quality with the existent satellite beauty?” Chang recalled. “I judge if you fto [the] idiosyncratic effort more, they volition bargain more.”

That proposal has carried the institution guardant connected its transportation to brands, adjacent arsenic fashionable user platforms specified arsenic Instagram connection akin filtering technology.

Perfect Corp. is 1 of a fistful of Taiwanese companies to database successful the United States successful caller years, according to Dealogic data.

Its accomplishment comes conscionable months aft Gogoro (GGR), a Taiwanese electrical scooter startup backed by Al Gore and 1 of Apple’s biggest suppliers, had its ain time connected Wall Street. The institution besides went nationalist successful New York this April aft merging with a SPAC, raising astatine slightest $335 cardinal successful currency astatine the time. Its shares are down 68% truthful acold this year.