Social networking platform Momo Inc, backed by e-commerce giant Alibaba, made its trading debut in New York on Thursday, raising $216 million for its US initial public offering.

The location-based application that lets users send text, photos or video to people nearby priced 16 million American depositary shares at $13.50 per share and opened at $14.25 a share on Nasdaq. Shares hit a high of $17.50 in the afternoon and closed at $16.90, a 25.18 percent increase.

"Our efforts in the past years have paid off, and we are very proud of this," said Tang Yan, CEO of Momo. "Many famous technology companies from China have listed on Nasdaq and we're very honored to join them."

Trading under the ticker MOMO, the company's public offering was jointly run by Morgan Stanley, Credit Suisse Securities, JP Morgan Securities and China Renaissance Securities.

It was the first Chinese tech IPO in the US since Alibaba's blockbuster stock sale in September, and will most likely be the last one of 2014. In addition to Alibaba, the year has seen a number of high-profile Chinese debuts, including social media site Weibo and e-commerce retailer JD.com.

Founded in 2011, Beijing-based Momo allows its 60.2 million active users to connect with each other through the application. Users can chat with others through the platform, finding people within their geographical vicinity or through shared-interest groups that are also location-based.

The company said in its filing that it has over 180 million users, 25.5 million of which are active daily. The application earns money through membership subscription services. Net revenue for the first nine months of 2014 was $26.2 million and the company is still unprofitable, according to its IPO filing

However, Alibaba's 20 percent stake in Momo is a boon for the company, said Michael Brush, stock and finance expert.

"Alibaba's stock has done well since it came out and people know the Alibaba name now, and there's such a potential for crossover in terms of Alibaba running its merchant ads on Momo and sharing the revenue," he said.

The e-commerce company launched its own social media chat client, Laiwang, last September, but Tencent Holdings and Sina Corp remain the dominant players in a crowded field. Alibaba has invested in social media applications like Sina's Weibo, a Twitter-like service.

"We fully support Momo. It is developing very fast," said Zhang Hongping, managing director of Alibaba Capital Partners and vice-president of Alibaba Group, at Nasdaq.

Momo was one of the first location-based service apps, and this capability is an advantage for the company, said Brush.

"Momo is like Facebook and Google where it has algorithms that can profile users, and so they can target ads. They have a really good sense of user interest," Brush said. "If you think about the location-based angle to that, that's pretty amazing. Can you imagine walking down the store and the app says you're near a Dunkin Donuts and then they shoot the person a Dunkin Donuts coupon? That's pretty amazing."

Momo CEO Tang said that the company wanted to build "point-to-point connections and build connections with groups." It wanted an online platform where location-based services can offer users "new and interesting experiences," he said.

Luo Lan, analyst with consultancy Analysys International, said that Momo has a "clear business model and has built up its user base with strangers networking via location-based services."

Momo's IPO came a day after its CEO was accused by former employer NetEase, a Chinese Internet company, of stealing information from the company when he was employed there from 2003 to 2011 . to build Momo.

Momo said in a filing to US regulators that Tang "has informed us that he believes the allegations are malicious and intends to vigorously defend himself against them."

amyhe@chinadailyusa.com

Tang Yan (center), CEO of Momo, joined by his family, Robert Greifeld, CEO of Nasdaq, and other staff of Momo celebrate the firm's IPO in New York on Thursday. Momo is China's third largest instant messaging app with around 180 million users. LU HUIQUAN/FOR CHINA DAILY