In May, "publicly challenged" Starbucks's Rui Xing coffee financing.
In July 11th, the company announced the completion of the A round of $200 million financing, which was valued at $1 billion. The capital, joyful capital, the Singapore Government Investment Company (GIC) and monarch capital were involved in financing.
In a piece of information, the Internet cafe, which has attracted much attention, said that the current round of financing will mainly be used for product development, technological innovation and business expansion. He confessed that some of the current sales promotion measures will continue for a long time, and will not exclude the increase of subsidies, "the company has not set a profit timetable, also prepared for long-term losses."
"Burning money" will continue
According to the public information, it was founded by the original COO money of the Shenzhou excellent car group and tried operation in January 2018. As of May 2018, it had completed the layout of 525 stores in 13 major cities, north, top, wide and deep.
The reporter noted that in the 4 organizations involved in Rui Xing coffee financing, apart from GIC, others have worked with Shenzhou. Rui Xing coffee has attracted a lot of investors' attention since its establishment. Taking into account the confidentiality and certainty of financing, we finally chose these more familiar and familiar investment institutions. This is the explanation of Rui's coffee.
Rui Xing coffee founder and CEO Qian Zhi Ya said that the current round of financing will be mainly used for product research and development, technological innovation and business development. "We are confident that through mobile Internet and big data and other means, we can achieve the best match of product quality, cost performance and purchase experience".
As a matter of fact, as early as February this year, Qian Georgia has revealed that Rui coffee is expected to start A round financing in April and is willing to contact all investors, especially investors with strategic resources. It has also announced the source of the 1 billion yuan startup fund for Rui Xing, which is composed of the founding team and the loan of the Shenzhou superior vehicle chairman and CEO Lu Zhengyao.
Up to now, Rui Xing coffee has not been profitable, and is still carrying out specific terminal subsidies.
Mr. Rui said, the first cup free, buy two gifts one, buy five five and other promotional measures will continue for quite a long time, and do not exclude that the back will increase subsidies.
In an interview with the international finance newspaper reporter, Mr. Rui replied that the company did not have a specific timetable for the profit and was prepared for a long-term loss. "At this point, there is a high degree of consistency between the company and investors."
Will Rui Xing's coffee be speeded up after getting financing? In this regard, Mr. Rui said, did not set a clear shop goal, the next step is to ensure the quality of products and services on the basis of steady development of the shop.
For this financing, the Chinese food industry analyst, Zhu Dan Peng, said that Rui was relying on the dividend of the whole Chinese macro-economy, the bonus of the entire coffee industry and the dividend of its own rapid layout. It will continue to inherit the original Internet companies' genes and carry out the layout of stores quickly. At the outbreak stage of the whole Chinese coffee industry, the brand cognition can be maximized through the way of buying or giving money. At present, investors have been more patient in the return requirements of enterprises, and have a relatively optimistic attitude towards enterprises with internet genes.
White hot competition
In the view of the industry, this round of financing of Rui Xing coffee has nothing to do with the escalation of consumption in the Chinese market and the outbreak of the coffee industry.
According to the report of the London International Coffee Organization, the consumption of coffee in China was about 70 billion yuan in 2015, and the Chinese coffee market was expected to reach trillion yuan before 2025.
Howard Schultz, former executive chairman of Starbucks (Howard Schultz), who has announced his resignation recently, said in a media interview that China will go beyond the United States and become the world's largest market for Starbucks. Obviously, the giants have high hopes for this market.
In fact, in the past year, Starbucks has accelerated the layout of high-end stores and flagship stores in the Chinese market. Besides focusing on the coffee industry, there are other competitive forces in the coffee market, such as convenience stores, chain restaurants and so on.
An insider told the international finance newspaper that in the past, China has been growing slowly in the coffee field, and there is a big gap in the coffee consumption in the Chinese market compared with Europe and North America. "Each year in Europe more than 700 cups per person, more than 400 cups per capita in the United States, more than 200 cups per capita in Japan and South Korea, only 4 to 5 cups in China, and less than 20 cups in large cities such as Beijing and Shanghai." The price is more expensive and the purchase is not convenient, which restricts the rapid growth of China's coffee market, the source said. Now, the rise of Internet coffee is aimed at these two major pain points.
In an interview with the international finance newspaper, Mr. Rui said that the opportunity for the Chinese market is very big and hopes to solve the problem of high price and inconvenient purchase through new retail way.
Zhu Danpeng pointed out that after the outbreak of this coffee industry, China's coffee industry will form a brand Pyramid pattern. Starbucks, Costa and other brands stand in the tip of the tower, even coffee, Rui coffee and other brands stand in the tower, the pagoda is mainly McDonald, Kentucky, a chain of catering enterprises, the bottom is instant coffee. "Rui Xing coffee and Starbucks are not direct competitors, because the consumer groups are getting bigger now. And the whole industry is already breaking out, so there is not much direct competition.
Zhu Danpeng pointed out that in the Chinese market, the attributes of coffee have changed, forming a concept similar to that of fast moving consumer goods. Rui Xing coffee and other Internet cafes are now the most lack of brand precipitation. These Internet cafes must establish their own corporate culture and brand culture in a short time.
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