China social e-commerce player Tongcheng Life gets $200m
Tongcheng Life, a social e-commerce business incubated by online travel agency Tongcheng-Elong, has raised a $200 million Series C round led by Joyy, previously known as YY, a US-listed video-based social media platform.
Engage Capital, Legend Capital, BAI, Tongcheng VC, Welight Capital, GSR Ventures and Oriza Holdings also took part. This follows a $100 million round led by Legend in September.
Established in August 2018, Tongcheng Life specializes in community group buying for perishables such as fruit and vegetables. It focuses on lower-tier cities. The company claims to have significantly improved supply chain efficiency by directly linking upstream farmers with end customers. It uses a WeChat mini-program for marketing and receiving orders, and employs community leaders in individual neighborhoods to coordinate purchases. Last-mile logistics works under a self pick-up model.
Following the COVID-19 outbreak, Tongcheng Life says it has maintained a stable supply of fresh produce as well as anti-epidemic materials. Online ordering and the contactless pick-up have facilitated social distancing, while ensuring necessary items reach consumers.
Zhixiang Wu, chairman of Tongcheng Group, said that Tongcheng Life would be integrated into the company's vision for an end-to-end "aviation-plus-tourism-plus-e-commerce" service for remote rural areas in China. This is intended to spur local tourism, poverty alleviation, and agricultural development as well as improve distribution efficiency for agricultural products.
Tongcheng Group wants to build a network covering 1,000 lower-tier cities. It recently signed an agreement with the government of Inner Mongolia to support the local specialty agricultural products industry.
The parent company was created by Tencent Holdings, Ctrip and Ocean Link through the merger of travel services business Tongcheng Network Technology and hotel and flight booking site operator E-dragon Holding. It listed in Hong Kong in 2018.
Similar recent deals include a GGV Capital-led Series C round of $81.4 million for Nice Tuan, another community group buying platform. That came five months after Joy Capital led a $88 million investment.
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