The Chinese logistics firm, 58 Suyun, which provides delivery and home moving services, has secured USD 250 million in the latest funding round led by the Beijing-based private equity fund InnoVision Capital.
Other participants include Alibaba’s logistics affiliate, Cainiao Logistics, private equity fund firm, Qianhai Fund of Funds, Russia-China Investment Fund (RCIF), as well as 58 Suyun’s parent company 58 Daojia.
The funds will be utilized to increase investments and improve competitiveness, the online platform 36kr.com reported.
58 Suyun was founded in September 2014, focusing on intra-city logistics and freight business.
It provides short-distance transportation solutions to individuals, small, medium and large ventures.
36kr.com further reveals that the company’s business has covered 339 cities across 6 countries and regions, and acquired about 8 million users as on July 2018.
In an interview in June this year, 58 Suyun co-founder and chairman Chen Xiaohua said that Suyun was enjoying a soaring business and would announce a funding round in the near future.
After several reshuffles, 58 Suyun’s intra-city logistics competition strategies have progressively become obvious.
The startup, which now mainly focuses on Chinese domestic market, and has already gained high market share.
Since last year, 58 Suyun has been expanding to smaller cities in China and entered other Southeastern Asian markets.
In August 2017, 58 Suyun merged with the Hong Kong-based online intra-city logistics platform GoGoVan, signaling that the company would continue to expand into these overseas markets, speeding up its globalization process.
Chen Xiaohua assumed the chairmanship of the new board and said that the two firms are complementary in logistics resources, transportation capacity, and regional coverage, and expected that the new company could become the leading logistics and freight platform in Asia.
Chen is confident about his company’s logistics prowess. In fact, the biggest strength of 58 Suyun is that its logistics service can include all ecommerce logistics services, be it business-to-business (B2B) or business-to-consumer (B2C).
“Although ecommerce mammoths like JD.com and Deppon Logistics have competitive transportation services, they are limited by fixed cities and routes similar to bus stations. What we spotlight is flexibility, that we can randomly arrange vehicles and logistics routes from point A to point B. For example, Mobike, the Chinese station-less bicycle sharing company, requires 200 vehicles from Huilongguan (northern Beijing) to Xisanqi (Haidian District, Beijing) today. If it needs 2 vehicles by a different route tomorrow, we can easily provide the service, while ecommerce logistics firms may confront a challenge.” Chen said.
With logistics at his command, the funds would come as a booster to execute the company’s plans to expand its businesses to newer shores.
The logistics industry in China was valued to be worth CNY 229.9 trillion and is poised to touch CNY 280 trillion (USD 43.5 trillion) in 2018, a recent study by Center for Forecasting Science under the Chinese Academy of Sciences, revealed.