Chinese B2B electronic components platforms raises Series A

The company previously received RMB105 million in September 2018 from Shenzhen Galaxy Supply Chain, a leading domestic components distributor. Lichuang has now joined a long list of B2B trading platforms that have attracted VC investors looking to leverage digitization to bring efficiency and pricing transparency to the more fragmented segments of the traditional economy.

Founded in 2011, the company claims to be China’s leading spot price platform for trading electronics components, with more than one million registered users and daily order volumes of nearly 4,000 units. Its online presence is supported by a substantial offline operation comprising 70,000 square meters of warehousing. Over 200,000 items are kept in stock with delivery guaranteed within four hours to customers based within range of a warehouse.

Lichuang considers itself one of about 33 domestic component distributors with annual revenue in excess of RMB1 billion. These companies generated RMB161.9 billion in aggregate revenue last year. Nine of the 33 are listed. Lichuang hopes trading volumes will be boosted by strong policy support for the development of a local semiconductor industry. China imported chips worth in excess of $300 billion in 2018 and the government is keen to ease this reliance on overseas sources.

Linjie Yang, CEO of Lichuang, said in a statement that the electronic component supply chain is undergoing profound change as manufacturers place greater emphasis on cost reductions and efficiency. He believes Licheng is well-positioned to become a one-stop-shop for manufacturers. The new funding will be used to accelerate expansion and introduce artificial intelligence and big data solutions to supply chains.

Yingchun Zhu, a partner with Eastern Bell, added: “Lichuang will not only become a leading company in the B2B trading of electronic components in China, but it will also develop into an important part of the electronics industry’s R&D infrastructure and drive local technological innovation.”

There are more than a dozen major B2B platforms in China, most of which emerged in 2012-2013. They operate in verticals such as pharmaceuticals, fabrics, fast-moving consumer goods, and industrial products and materials. The likes of Haoqipei, Ouyeel, and Yijiupi, which focus on auto parts, steel products, and liquor, respectively, have all received funding in recent months.

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• Topics
• Greater China
• Early-stage
• Technology
• Industrials
• China
• TMT
• manufacturing
• Sequoia Capital
• Eastern Bell Venture Capital