VentureBeat

ChinaInteractive Corp, the fastest-growing Internet company in China, and which some are calling China’s MySpace, has raised $48 million from a bunch of Silicon Valley and other investors.

It has also changed its name to Oak Pacific Interactive. See release (download’s document).

Oak Pacific’s main property is MOP.com, where Chinese users can watch live Chinese TV, and change channels. It lets you download movies. The company, based in Beijing, also offers a host of other services, including profile pages ala Myspace, SMS, dating service voice mail, blogging — the list goes on.

Mop.com

Soon, the company also plans to launch a global service, to be called “Hi There,” but they’re not revealing too much about that just now. Investors, including David Chao, of Doll Capital Management, believe the company can go public within the next year or two.

We asked Chao whether he feared the company might be trying to bite off too much. He said the Chinese market is growing so quickly, it is the one place where you can risk being so boldly “heterogeneous.” He conceded, however, that “the challenges are to integrate all of this.”

The company is the largest privately held company in China besides Alibaba, the online marketplace competitor to eBay.

Oak Pacific has acquired half a dozen companies, including UUMe.com, where Chao’s DCM and another Silicon Valley firm, Accel Partners, were investors. Seeing China Interactive’s impressive growth, DCM and Accel decided to invest in China Interactive for a small initial investment. Now they’ve joined with General Atlantic for this latest investment. GA was the lead investor. Legend and TCV are also investors.

It is the largest social networking Web site in China. It is also the fastest growing, according to chief executive Joe Chen. It has a hundred million page views per day, making it slightly smaller than MySpace, but larger than Facebook — and in the top thirty global Web sites. In China, it is number five or six in total advertising online, after the three big portals, Baidu, and possibly Tom.com.

Chen, who founded the company, grew up in China, but moved to the U.S. when he was 20. He went to MIT and then to Stanford business school. But in the late-1990s, he went back to China, and built Chinaren into the fourth largest portal in china, which he sold to Sohu in 2000. He then tried to build a couple of optical companies, but neither got off the ground. Then, in 2002, he invested in UUMe, which was started by James Liu, a friend of his at Stanford business school, who is now co-COO. There a number of other Stanford connections, including his CFO, and two investors David Chao and General Atlantic’s Vince Feng.

Right now, he’s looking to recruit people to open a Silicon Valley office.

Interestingly, Chen said the company is profitable and didn’t really need to take the investment capital. But investors wanted to put their money to work — the more money they invest, the bigger stake they get, and thus more profits down the road if the company pulls off a successful IPO. We asked him why he took the money then, since it meant he and his employees would be “diluted.” (In other words, their ownership stake in the company will decline). He said both sides “ended up compromising,” because the investors had originally wanted to invest a lot more money. He did say, though, that the extra cash will help him acquire more companies. They already have 700 employees.