China truck logistics players Huochebang, Yunmanman agree merger

Gang Wang, a backer of Yunmanman and an angel investor in Chinese ride-hailing platform Didi Chuxing, will become the chairman and CEO of the combined company. Hui Zhang and Peng Luo, the CEOs of Yunmanman and Huochebang, respectively, will become co-presidents of the group. The two companies will operate independently under their own brands following the transaction, although they will share resources.

China’s logistics sector was worth RMB7.9 trillion ($1.14 trillion) last year, but the trucking industry remains highly fragmented and inefficient. Individuals own more than 90% of trucks and these vehicles stand empty 40% of the time. Both Yunmanman and Huochebang (also known as Truck Alliance) want to fully utilize these resources by connecting long-haul drivers and shippers through an online platform.

Founded in 2007, Huochebang has received several rounds of funding. It raised approximately $100 million across three Series A tranches. The first, which closed in March 2015, was led by Eastern Bell Venture, while the second was led by Tencent Holdings later the same year. Genesis Capital led a $35 million third tranche in April of last year.

The company then raised a Series B round worth $327 million, also across three tranches. An initial round of $115 million in December 2016 – co-led by All-Stars and International Finance Corporation – was followed by a $156 million round in May, led by Baidu Capital. In August, All-Stars re-upped in the company with $56 million follow-on investment.

Yunmanman received seed funding from Wang in 2013. It then received a $5 million Series A round from Lightspeed China Partners in 2014 and a Series B from Sequoia Capital in May 2015. Three months later, Yunfeng Capital then led a Series C round for the company. Last year, Yunmanman reportedly closed its Series D at $110 million with commitments from undisclosed investors.

In addition to matching services, the companies have expanded into after-market services and financial services for truck drivers. While Yunmanman has been focusing on second-handed vehicle trading and truck insurance sales, Huochebang has developed a new business line by issuing electronic toll collection (ETC) cards. It helps drivers install wireless ETC devices in trucks, so they can pay tolls without stopping their vehicles.

Huochebang has signed up 4.5 million truck drivers and 880,000 shippers, and is hosting five million transactions each day. Meanwhile, Yunmanman claims to have four million truck drivers and one million shippers on its platform.

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• Topics
• Greater China
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• China
• TMT
• All-Star Investments
• Lightspeed Venture Partners
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• DCM-Doll Capital Management
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• Logistics