China’s newest coffee chain is no longer “Luckin” for funding

China’s entrepreneurs have made a habit of taking on the established players, whether that be in online retail (think Alibaba vs Amazon), messaging services (think WeChat vs WhatsApp), ride hailing (think Didi Chuxing vs Uber), and now it would appear that a Chinese entrepreneur is ready to take on Starbucks in the Chinese coffee space. 

Luckin Coffee, started in January this year by Qian Zhiya, formerly an executive at China’s Ucar Inc., has already opened 525 coffee chain stores in the last four months and has won over a reported 1.30 million customers with its combined strategy of a delivery service and “traditional bricks and mortar” cafes. While the company has opened traditional stores in cities like Beijing and Shanghai, it is also offering a service based on “takeaway kitchens”, where customers can order coffee for delivery via a courier and if the coffee is not delivered in thirty minutes, there is no charge.

Luckin has an app through which all its orders are placed and signing up to this app provides an initial free cup of coffee for each new user, while removing the need for the company to take cash – another common theme for service providers in China, where mobile payments seem to rule.

There are reports that the company has just secured a Series A funding round of between USD 200m and USD 300m, which would value the whole business at over USD 1bn, making it not only the latest Chinese unicorn, but the first coffee unicorn as well.

Let the coffee battles commence!

 

Filed under: China, Coffee, deals, software, tech, café