Xiaokuo Technology, the name behind the Canban brand, could be the first member of its class to list in Hong Kong, growing at lightning speed through savvy use of online KOLs

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Key Takeaways:

• Xiaokuo Technology has filed for a Hong Kong IPO, reporting its revenue rose 82.5% last year, with a gross margin of 72.5% for its core basic oral care segment
• The company's super-charged marketing strategy using online KOLs has made it China's fastest-growing oral care products seller less than a decade after its founding

When 30-something Yin Kuo said in a recent interview that he wanted to build his oral care company into the "Procter & Gamble of China," it seemed like a stretch for a firm that only got into the business in 2018 with its Canban brand and didn't start selling toothpaste until 2022. But Yin's Shenzhen Xiaokuo Technology Co. Ltd., backed by powerful investors, took a big step in that direction last week with its application for a Hong Kong IPO, revealing some foamy growth over the last three years.

The company's Canban brand competes in China with P&G's (PG.US) Crest and Colgate-Palmolive's (CL.US) Colgate brands, as well as market leader Yunnan Baiyao (000538.SZ), a traditional Chinese medicine company founded in 1902, with 25% of the market.

Despite its late start, Canban held 9.2% of China's toothpaste market last year, and was the only brand in the top five to boast triple-digit annual growth – at an impressive 231.7% – for offline retail sales of its toothpaste between 2023 and 2025, according to its listing document. The company is part of a massive Chinese toothpaste market that grew at an average rate of 3.7% over the last five years to reach 56.6 billion yuan ($8.23 billion) in 2025.

The toothpaste market's relative maturity doesn't seem like very fertile ground for a newcomer, especially in the context of weak growth for more specialized oral companies like Huge Dental, a maker of dental materials, which also applied for a Hong Kong listing this year. Recently listed dental services companies like Meihao Medical (1947.HK), Arrail (6639.HK) and Dazhong Dental (2651.HIK) have also done poorly, down significantly from their IPO prices, reflecting consumer reluctance to spend on the pricier dental treatments they provide.

Toothpaste is clearly in a different category, used by most urban dwellers on a daily basis and seen as a cornerstone to good oral health. But that doesn't mean the road to an IPO will be easy. Rival Weimeizi, maker of popular Saky brand toothpastes, filed to list in Hong Kong in 2022, but never made it to market. That means Canban could be the first in its class to list in Hong Kong if its IPO succeeds.

The company certainly has a strong growth story for investors, though that's at least partly due to its recent arrival on China's oral care scene. Its revenue grew 82.5% in 2025 to 2.5 billion yuan, more than double the 1.1 billion yuan it recorded in 2023.

It fell into the red last year with a loss of 18.25 million yuan, reversing a profit of 34.2 million yuan in 2024. But the loss was due largely to 110 million yuan in costs related to share-based compensation. On an adjusted basis, which excludes such costs, its net profit more than doubled last year to 154.8 million yuan from 66.3 billion yuan in 2024. Gross margin for the company's basic oral care segment, which made up 92.9% of revenue last year, was a very solid 72.5%, reflecting Canban's focus on the higher end of the market.

Heavy-duty investors

Canban has also attracted some heavy-duty investors on the road to its listing, including tech guru Lee Kai-fu's Sinovation, better known for its high-tech investments, as well as a fund tied to short video sensation Douyin, China's version of TikTok. The company embarked on a fundraising spree between 2018 and 2021, completing 10 rounds that saw its valuation skyrocket from just 50 million yuan to 1.87 billion yuan over that time.

Canban has sprinted into the top five toothpaste brands largely through its savvy use of online key opinion leaders (KOLs) on the hugely popular Douyin and RedNote platforms. Its 13 brand ambassadors appeal to younger consumers who may not want to spend hundreds, or even thousands, of yuan on high-end dental services, but are far more willing to splash out for more affordable toothpastes that promise brighter smiles and fresher breath.

That heavy marketing shows up in Canban's sales and distribution expenses, which totaled 1.53 billion yuan last year, up 84% year over year, and equal to more than 60% of its revenue. Its top supplier wasn't a provider of toothpaste raw materials, but rather a marketing services company that received 180 million yuan last year. Four of its top five suppliers also provided marketing and marketing-related services.

At its peak, according to Chinese media reports, Canban released as many as 6,576 short videos daily. Those came not only from celebrity influencers, but also from thousands of ordinary people in scenarios about bad breath while dating and in other awkward moments that could be improved through use of the right toothpaste or mouthwash.

Yin Kuo was just 26 when he founded Xiaokuo Technology in 2015 as his second startup. A native of Eastern China's Anhui province who graduated with just a high school degree in 2005, Yin started his second venture as a company selling electric toothbrushes. He pivoted to oral care products three years later when the Canban brand was born.

When he launched his first toothpaste in 2022, Yin challenged industry stalwarts with his concept of "caring for your mouth like you care for your skin." That included his introduction of high-end products priced as high as 108 yuan, or more than $15 per tube.

Yin is a product of the younger online generation, as reflected by his heavy focus on e-commerce. Last year, 80.3% of his company's sales came from online channels, most of that from direct online sales, while offline channels accounted for just 19.7%, mostly through distributors.

Canban's e-commerce focus could become problematic for its longer-term growth, since offline channels still account for 60% of the broader Chinese toothpaste market. Canban has been trying to address that by moving closer to the industry standard of 50-50 online-to-offline sales, and its prospectus shows its offline revenue roughly tripled to 493 million yuan in 2025 from the 162 million yuan it reported in 2024.

Yin acknowledges that building a traditional offline business isn't easy. "When you actually go offline, you'll find that the competitors are very strong," he said in an interview last year in Chinese media. "If you analyze it rationally, offline is not a good business, but a business you have to do, and you have to constantly think about how you can squeeze out a little profit when others are not making money."

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Benzinga Disclaimer: This article is from an unpaid external contributor. It does not represent Benzinga’s reporting and has not been edited for content or accuracy.