Genesis backs Chinese second-hand machinery trading platform

Qiming Venture Partners and DCM also participated in the investment. Qiming provided Tiebaobei's Series A round in 2013 and then it was joined by DCM for the RMB100 million Series B in June of last year.

Founded in 2009, Tiebaobei operates a C2C platform that is intended to improve pricing transparency for second-hand construction machinery and help people find the cheapest products. It receives commissions from every sale. The company claims to have 300,000 registered users and nearly 18 million units of equipment listed on the platform. Average monthly turnover is close to RMB200 million.

The new capital will predominantly go towards service improvements, notably quality assurance for equipment sold through the platform. Tiebaobei has longer-term aspirations to expand its coverage, offering spare parts, maintenance, financing and other services in addition to the second-hand equipment trading.

The company told local media that sales of new construction machinery came to RMB640 billion in 2014 and are expected to reach RMB900 billion by within five years. Second-hand sales, which totaled RMB300 billion in 2014, are also tipped to experience substantial growth.

Numerous online trading platforms dedicated to particular products and services have received venture capital funding in China. In the used car segment alone, there are multiple B2B and B2C platforms such as Uxin, Chemao and Renrenche, as well as a smaller number of C2C and C2B specialists, including Haoche51 and Carsing.

B2B services have also gained traction in the raw materials space, with steel-trading platform Zhaogang raising five rounds of funding over the last two years. Qiming is an investor in a similar business that focuses on plastics - Zhaosuliao - which has also received backing from New Horizon Capital and IDG.

Genesis Capital - known as Yuan Sheng in Chinese - was founded by Richard Peng, an ex-Google executive who subsequently spent seven years leading Tencent's M&A activities, participating in an estimated 90 deals. He left the company at the end of 2015.

Lighthouse Capital served as financial advisor on the Tiebaobei investment.

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• Topics
• Greater China
• Venture
• Expansion
• Technology
• TMT
• Qiming Venture Partners
• DCM-Doll Capital Management