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Baijiu brand Jiangxiaobai raises USD 300 million, now valued at USD 1.9 billion

Jiangxiaobai aims to shake up the old-fashioned image of baijiu for a new mix of customers.

Jiangxiaobai, a maker of Chinese baijiu liquor, has reportedly raised USD 300 million in its Series E round led by China Renaissance’s Huaxing Growth Capital, with a post-round valuation of RMB 13 billion (USD 1.9 billion).

The round also saw Loyal Valley Capital, Baillie Gifford, and China Merchants Bank International Capital Corporation enters Jiangxiaobai’s cohort of backers, according to local media outlet 36Kr, citing sources. Jiangxiaobai declined to comment on the news but said only that it’s preparing new products.

The Chongqing-based brand has previously secured funding from IDG Capital, Hillhouse Capital, BlackAnt Capital, and Sequoia Capital.

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Founded in 2016, Jiangxiangbai is an upstart in a market dominated by traditional, established players—namely Kweichou Moutai, the country’s largest, and Sichuan Wuliangye. According to a report by Hurun Research Institute, the main consumers of baijiu are men aged on average 37, who often purchase baijiu to treat guests and as a gift. The new brand’s success is notable because, rather than fighting these big names for the liquor’s established customer base, it has been working to introduce younger Chinese to the joys of baijiu-drinking.

Jiangxiaobai excels at leveraging social media platforms such as short video app Douyin and lifestyle-sharing platform Xiaohongshu, two platforms whose user demographics skew young. For example, the company has leveraged the former to popularize Jiangxiaobai-based cocktails, with some sponsored videos garnering over half a million likes. They also offer fruit-flavored and sparkling baijiu drinks while Moutai and Wuliangye do not.

The company claimed that it raked in nearly RMB 3 billion (USD 437.91 million) last year in revenue.

The market size of the baijiu industry in China reached RMB 542.7 billion (USD 79.11 billion) last year, per stats from research firm Qianzhan. Top player Moutai (SH:600519) is one of the most valuable Chinese companies with a stock price of over RMB 1,690 (USD 246.69) and, at its peak hit RMB 1,828 (USD 266.83) on September 2.

In recent years, innovative food and beverage companies have gained favor from VCs. Among them are Heytea, Naixue Tea, soft beverage brand Genki Forest, and ice cream brand Zhongxuegao.