China food delivery app Line0 raises $30m

Nanjing-based Line0 was founded in 2012 and provides food ordering and delivery services. In addition to partnering with restaurant chains, it has developed its own brand - Zero - through cooperation with food producers that have few, if any, outlets of their own. Sales through the Zero brand account for 30% of total revenue, William Wu, Line0's founder and CEO, told local media.

The company covers five cities, including Nanjing, Shanghai, Shenzhen, Suzhou and Wuhan. Unlike many other food-ordering platforms, Line0 runs its own delivery fleet rather than relying on third-party providers.

"For younger age groups, the demand for takeaway is rising year by year," Wu told TechinAsia. "But among China's food and beverage companies, small and medium-sized businesses lack the capacity to build their own delivery systems, while the giants generally do not want to, so there is a huge opportunity."

The start-up secured an undisclosed Series A round from Sequoia in July last year and seed funding from Gobi in 2012. With this latest investment, it plans to expand into 15 additional top-tier cities this year.

Competition is increasing in China's online food delivery market as VC investors back start-ups looking to achieve scale ahead of expected consolidation. Online platforms such as Etaoshi, Daojia, Ele.me and Meican have received funding from VCs as well as strategic investors.

According to internet consultancy iResearch, food will represent one of the largest vertical segments of the online-to-offline market by 2015, with 300 million customers and a value in excess of RMB270 billion ($44 billion).

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• Topics
• Greater China
• Consumer
• Venture
• Technology
• China
• Venture
• TMT
• Tencent
• Sequoia Capital
• Gobi Partners
• Consumer