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Chinese snacks business receives $14m Series B

  • Larissa Ku
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A1 Snack Lab – a Chinese snack brand based in Xiamen - has received RMB100 million ($14 million) in Series B funding from new and existing investors.

The identities of the new investors were not disclosed. Existing backers Dyee Capital and Capital Today China Group both re-upped.

Founded in 2016, A1 produces snacks with a relatively short preservation period. Given the limited use of preservatives, these products are said to be healthier, while distribution costs are kept down due to the fast turnover rate, according to Weiping Zhou, the company's founder.

A1, which claims annual revenue growth of 300%, focuses on launching one best-selling product every year. These were an egg yolk puff and a cloud cake in 2018 and 2019, respectively. The cloud cake is the exclusive title sponsor of popular Chinese reality TV show “We are in Love.”

“By focusing on one core product, the production line can run continuously for seven days and costs are reduced,” Zhou told 36Kr.

The company leverages its relatively low price points by targeting customers in lower-tier cities. It has also launched its own offline stores, with 100 set to open by 2020. Most sales come through a network of third-party offline distributors that cover up to five million retail terminals, including supermarkets and convenience stores.

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