FountainVest leads Series B for China's MyMRO
Shanghai-based B2B e-commerce company MyMRO, a spinoff of US industrial products supplier Grainger, has raised several hundreds of million renminbi in Series B funding led by FountainVest Partners.
Other investors include Hongtai Capital, Sinovation Ventures, a fund under China Merchants Venture, and several government-linked vehicles.
MyMRO separated from Grainger through a management buyout - led by Yanhua Zhou, previously general manager of Grainger China - last September. Sinovation led a Series A at the time of the restructuring.
Maintenance, repair and operations (MRO) businesses serve as a one-stop shop for products such as industrial accessories, consumables, and spare parts. The goal is to rebuild traditional procurement channels through supply chain digitalization, integrating trading platforms, digital tools, and intelligent services.
Other private equity-backed players in this space include JD MRO, a subsidiary of e-commerce giant JD.com, and Zhenkunhang. Last year, JD MRO secured $230 million in Series A funding while Zhenkunhang closed a $315 million Series E round.
MyMRO has seen rapid revenue growth in the two quarters since the separation, according to a FountainVest statement. Steps have also been taken to boost the sales team and enhance logistics infrastructure. This includes front-end warehousing - a familiar feature of China's fresh produce platforms - built close to customers to increase last-mile delivery efficiency.
Grainger was founded in 1928 and entered China in 2006. Combining MRO strategies imported from the US with a wealth of local data points, it created an artificial intelligence-enabled middle platform comprising management systems for suppliers, supply chains, commodities, and customers, plus a big data center that ties everything together.
The company has divested various international assets with a view to focusing on its core North American business.
FountainVest estimates China's MRO market is worth more than RMB1 trillion ($155 million), but it is highly fragmented with no one player enjoying a more than 1% share. However, there is rising demand for standardization, transparency, and "informationization" in procurement processes, the PE firm added. This is a result of increasing costs tied to industrial upgrades and wage inflation.
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