Chinese O2O retailer raises $59m from Alibaba-backed fund
KK Guan, a China-based online-to-offline (O2O) retailer that mainly sells imported goods, has received RMB400 million ($59 million) in Series C funding led by the Electronic World Trade Platform (eWTP) Ecosystem Fund, which is backed by Alibaba Group and Ant Financial.
Other participants include Hongtai Capital, a fund established by Minhong Yu, CEO of US-listed New Oriental Education & Technology Group, and banker Xitai Sheng in 2014. The company’s existing investors - Matrix Partners China, Black Algae Capital, and Shenzhen Capital Group - also re-upped.
Founded in 2014, KK Guan operates an online marketplace and over 100 offline stores that sell goods ranging from snacks to baby care products. The company, which plans to add another 200 outlets this year, claims its sales volume grew at 20% monthly between January 2017 and April 2018.
While most of its stores are directly operated, KK Guan intends to introduce a franchise model in April with a view to expanding its national coverage at a faster pace. The company is also developing and upgrading its databases to improve the operational efficiency of its stores.
KK Guang raised RMB100 million in a Series A round back in 2017. A year later, it received RMB70 million in Series B funding from the likes of Matrix.
Launched last year with a $600 million anchor commitment from Alibaba and Ant Financial, eWTP seeks to help companies expand internationally and drive technological innovation. Projects linked to the Belt and Road Initiative are of particular interest. Jack Ma, Alibaba's executive chairman, proposed the fund in 2016, saying he wanted to support small and medium-sized companies.
Currently, eWTP is headed by Yongfu Yu, formerly chairman of Alibaba Digital Media & Entertainment Group.
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