Today is the day.
China’s quickly rising Starbucks competitor Luckin Coffee has announced its raise of $200 million led by GIC and China International Capital Corporation. You’ll recall that the coffee-focused startup was reported to be raising a round of between $100 and $300 million in November. This confirms those reports.
Follow Crunchbase News on Twitter
The raise brings Luckin’s total known funding to $400 million. The company first raised $200 million also led by Singapore’s GIC back in July. At the time, the company was valued at $1 billion. Luckin more than doubled its valuation to $2.2 billion, according to Reuters.
Luckin has gained a name for itself in the startup world, popping up seemingly out of nowhere with the goal to overtake Starbucks’s market share in China. The company’s method of combining very cheap prices with delivery and massive brick and mortar expansion is proving to be a challenge for Starbucks.
Some reports also included Dazheng Capital as a Luckin Coffee investor. We were unable to confirm this information prior to publication
According to Reuters, the company, which officially launched in January, said that it operates over 1,700 stores in 21 cities in China. According to Bloomberg, Starbucks, which launched in the mainland in 1999, has more than 3,400 outlets in 140 cities. Bloomberg also notes that a cup of coffee at Luckin is 30 percent cheaper than one at Starbucks. In August, Starbucks partnered with Alibaba to pilot a delivery service for 150 stores in Beijing and Shanghai. In September, Luckin reportedly partnered with Tencent as well.
Luckin will use the money to continue its rapid expansion.
Illustration Credit: Li-Anne Dias