Centurium invests $100m in Chinese eyewear brand

The company received a $5 million Series A round from Vertex China and KTB Ventures in 2014 and a $20 million Series B from Vertex and Sequoia Capital China the following year, according to AVCJ Research. However, Centurium – which was established last year by David Li, formerly China head at Warburg Pincus – is the sole investor in the most recent round.

Founded in 2012, Loho has more than 400 stores in 100 Chinese cities and claims to introduce new models of eyeglasses every week, taking on average 20 days to get a design from the drawing board to the shop shelf. Customers typically explore the product range online and then make appointments to visit a physical store to get an eye test, try on different eyeglasses, and complete their purchase. They can also avoid the offline experience completely and simply buy through the online store.

"Loho is now at a critical stage on our path of rapid expansion, and the new financing will be used to increase investment in supply chain buildup and marketing campaigns. We will also increase spending on our R&D capabilities to improve user experience," Xinzhong Huang, the company's founder and CEO, said in a statement.

China's eyewear market is said to be worth nearly RMB100 billion ($14.5 billion), but it remains highly fragmented. The integrated manufacture-to-consumer (M2C) approach taken by Loho - which is backed by an efficient supply chain system - is seen as a potential force for consolidation as it facilitates product delivery at lower cost.

Gary Liu, an executive direct at Centurium, added that Loho's strategy also means the company can be nimble in responding to changes in demand. "With the rise of the new generation of younger consumers, eyeglasses are gradually regarded as fashion accessary, and early and fast movers close to young customers will be best positioned to take the market," he said.

Centurium launched its debut China fund in the first quarter of 2018 and reached a first close of around $1 billion in June. A hard cap has been set at $1.5 billion. The firm targets mid-cap buyout and significant minority investments. Recent deals include taking the lead in a $200 million round for coffee shop chain Luckin Coffee and subscribing to a $590 million share issue by China Biologic Products.

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• Topics
• Greater China
• Consumer
• Technology
• Expansion
• China
• Centurium Capital
• Growth capital