Chinese B2B liquor trading platform gets $200m Series C
Tencent Holdings and Meituan-Dianping have led a $200 million Series D funding round for business-to-business (B2B) online liquor trading platform Yijiupi.
China Everbright and Source Code Capital also took part in the round, which gives the company a post-deal valuation of $1.1 billion, according to a statement. Source Code and Meituan-Dianping also featured in a $100 million Series C for Yijiupai in 2016. That round was led by Greenwoods Asset Management.
Founded in 2014, Yijiupi serves as an information source and purchasing platform for bar and restaurant owners. It operates in 83 Chinese cities, including Beijing and Shanghai, has more than 3,000 employees, and offers over 40,000 stock-keeping units (SKUs). Gross merchandise volume (GMV) is expected to surpass RMB20 billion ($2.9 billion) in 2018.
Yijupi’s business model is one of classic supply chain disruption. Bulk liquor orders are typically processed through several regional and local distributors, of which there are more than 700,000 in China, but Yijiupi directly connects buyers with suppliers. By aggregating orders from multiple buyers, the company achieves greater bargaining power and lower prices.
The new investment will lead to closer cooperation between Yijiupi, Tencent and Meituan-Dianping. This includes Yijiupi setting up a mini-app within Tencent’s WeChat messaging app and establishing an online store through Meituan-Dianping. The company’s goal is to become an integrated B2B platform for China’s fast-moving consumer goods space – which was worth RMB100 billion in 2017 – providing financial, warehousing and other services for the small and medium-sized enterprises.
Various Chinese B2B marketplaces have received interest PE and VC investment, including several that focus on helping small companies source goods from wholesalers at competitive prices through bulk buying. In March, Zskuaixiao received a $33 million Series B led by Global Logistics Properties (GLP) and Longzhu Capital, a VC firm established by Meituan-Dianping. Others include Huimin and Farmlink, which focus on supermarkets and restaurant chains, respectively.
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