China mobile recycling platform Aihuishou raises $100m
JD.com and Guotai Junan Securities have co-led an extended Series E round of $100 million for Aihuishou, a China-based electronic products recycling platform.
Shanghai Guohe Capital, Fresh Capital, and Huihe Capital, the industrial investment arm of JD Logistics, also participated in the round.
The funding announcement coincides with a rebranding exercise by Aihuishou. The group company is now known as Wanwu Xinsheng, which translates as "new life for everything." It serves as an umbrella brand for several business lines: Aihuishou; Paijitang, a B2B auction platform that services 150,000 small and medium-sized enterprises (SMEs); Paipai, a B2C second-hand trading platform that was previously part of JD.com; and various overseas operations.
Aihuishou – which means "love to recycle" - was founded in 2011 by a team that won a recycling-themed business plan competition at Fudan University. The online platform allows consumers to sell or recycle used laptops, mobile phones, and tablet devices. Sellers can receive cash payments or do part-exchanges for newer or refurbished models.
The company absorbed Paipai last year. Xuefeng Chen, CEO of Aihuishou, said the merger enabled the creation of a closed-loop full-channel service, stretching from the collection of used items to their resale to businesses and consumers.
The addition of Paipai also led to the introduction of a one-stop trade-in service for mobile phones, leveraging Aihuishou's 700 offline stores. Users evaluate products on JD.com, pay the trade-in difference online, and then make collections from Aihuishou stores or opt for home delivery. Aihuishou engineers wipe the memories of old phones and manage data migration for buyers.
This service is supported by mainstream manufacturers including Apple, Huawei Technologies, Xiaomi, Oppo, Vivo, and Samsung, according to a company statement. Chen said that more than 10,000 phones were traded in via JD.com on June 18 alone. Aihuishou also provides the same service at Huawei Mall, Xiaomi Mall, and other offline retail channels.
Despite COVID-19, the company has seen rapid transaction volume growth and is profitable on a quarterly basis. Average single-day transaction volume now exceeds 70,000 units, with C2B recycling accounting for 15,000 units and B2B and B2C sales contributing 40,000 and 10,000 units, respectively. Overeas business and other transactions are responsible for 5,000 units.
Morningside Ventures committed $2 million in Series A funding to Aihuishou in 2011, with the International Financial Corporation (IFC) leading an $8 million Series B in 2014. A Series C of $60 million closed the following year with Tiantu Capital taking the lead and then Cathay Capital Private Equity and Shenzhen Fortune Venture Capital led a RMB400 million ($58 million) Series D in 2016. Most recently, Tiger Global Management led a $150 million round in 2018.
Taihe Capital served as financial advisor for the Series E extension.
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