China’s B2B online FMCG trading startup Yijiupi (易久批)secured USD 80 million from Tencent (0700: HKEX), showing the tech giant’s ambitions on industry internet.
The transaction followed Warburg Pincus’s USD 100 million investment in an extended Series D round February. Tencent and Meituan Dianping (3690: HKEX) injected USD 200 million in Series D round last August when the firm said it would use the funds to diversify platform categories.
In parallel with the launch of a new website that has two separate channels-“alcohol, beverage and packaged food” and “grocery and snacks”, Yijiupi expanded its B2B product portfolio from alcohol. Small and medium grocery stores use it on a daily basis, as China’s B2B information channel B2B Neican investigated.
While it keeps expanding horizontally in categories, Yijiupi moves vertically along the value chain as well. Its factory-to-end customer business, generating high margins, achieved hundreds of millions of yuan annual revenue. Supply chain finance business has recorded CNY 4 billion (USD 566.8 million) to date and is expected to surpass CNY 10 billion at the end of this year. On the other hand, Yijiupi operates not only B2B transaction, but also B2C offerings by opening wholesale supermarkets and direct-selling stores, which lead to a broader customer base.
Apart from its broad portfolio, Yijiupi became the leading online player with vast geographical coverage- 500 county towns, 140 municipalities in 26 Chinese provinces. The company eyes CNY 20 billion (USD 2.83 billion) GMV this year. CNY 15 billion goods are delivered from its own logistics warehouses.