Nice Tuan, a Chinese group-buying platform for farm produce and other groceries, has raised $196 million in a “Series C3” round co-led by Alibaba and Hong Kong’s Jeneration Capital.
Other investors to participate included CDH Investments, CICC, Cygnus Equity, GGV Capital, INCE Capital, Joy Capital, KunLun Fund, and Qiming Venture Partners.
It’s the fourth round of funding that Nice Tuan — also known as Shi Hui Tuan — has netted since the start of 2020. In January it banked $88.3 million from investors including Alibaba and ZhenFund, following that up in June with an $81.4 million “Series C1” round led by GGV Capital. A month later, its CDH Investments-led “Series C2” raise brought in another $80 million.
Beijing-based Nice Tuan connects farmers and other food producers to retailers, foodservice businesses, and end customers. It allows buyers to form groups via its WeChat mini-program, enabling them to collectively buy produce in bulk for more competitive prices.
It’s just one of a number of similar community e-commerce platforms that have sprung up in China in recent years, as consumer appetites for fresh and traceable farm-grown produce hit new heights.
In September, Bunny Maicai secured “tens of millions of dollars” in a Series A round led by an affiliate of real estate giant Country Garden, with Joy Capital and ZWC Partners also taking part. The startup combines the online group-buying concept with a chain of physical stores to give customers an online-to-offline experience.
Another group-buying app, Tongcheng Life, raised $200 million in Series C funding back in June. The round was co-led by livestreaming platform Joyy, which has recently hit headlines after a report on the company by investment research firm Muddy Waters accused it of “multi-billion dollar fraud.”
According to the most recent edition of AgFunder’s China AgriFood Startup Investing Report, Tongcheng Life raised $100 million for its August 2019 Series B round led by Lenovo-affiliated Legend Capital; while Familyone, also known as Lilinyi, got $30 million from Sequoia Capital, Capital Today, Gaorong VC, Source Code Capital, and retailer Suning.
More broadly, Chinese e-grocers have been attracting big-dollar funding from domestic and overseas investors alike.
MissFresh scored $495 million in July from CICC, Goldman Sachs, Tencent, Tiger Global, and others. It operates a network of close to 1,500 small-scale distribution centers near residential areas across China, bringing an element of localization to its grocery service and allowing it to cut both delivery times and cold-chain costs when compared to providers that rely on fewer larger-scale warehouses.
Beijing-based MissFresh was China’s highest-funded agrifoodtech startup last year, according to AgFunder research, securing $700 million in debt financing from local government. Also netting large funding amounts in 2019 were fellow Tencent investees Yipin Fresh — a ‘new retail’ supermarket that received $298 million in a round led by the tech giant — and tech-enabled convenience store chain Furong Xingsheng, which raised a total of $246 million across two rounds.
In a statement on the WeChat page of Cygnus Equity — which also acted as sole financial advisor for the transaction — Nice Tuan said it will use the “Series C3” funds to help more small and medium-sized businesses to generate more income from their produce and other offerings, and expand sales channels for local brands and agricultural products.
“The community group-buying business model continues to iterate and evolve, and the entry of tech giants is bringing unprecedented competition [to this segment],” said Cygnus Equity managing director Jin Tao.
“We firmly believe that in such a rapidly changing market, Nice Tuan will be the ultimate winner thanks to its management team’s strategic vision, organizational abilities, strong execution, and determination.”
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