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Chinese e-commerce firm scores eight-figure investment from Weibo

Ymatou achieved profitability in 2019, and is leaning on influencers for growth in sales.

Photo: Tuchong

Shanghai-based e-commerce platform Ymatou said on Monday that it has closed its Series D round with an investment of several hundred million yuan from Weibo, 36Kr reported.

At the same time, an influencer who calls himself Niurouge, who promotes wine and beef brands in his live-streaming sessions, announced that he will contribute RMB 100 million (USD 14.3 million) in equity to become a partner of Ymatou. No further details have been released regarding this deal.

Ymatou was founded in 2010. The company closed its Series C round in November 2017, but did not disclose the total funding sum. In January 2015, the company sealed up its Series B round with USD 100 million. Ymatou told 36Kr that the company achieved profitability in 2019, though it did not reveal any financial details.

The latest investment from Weibo will be used to improve the short video and live streaming features in Ymatou’s platform. Weibo will strengthen Ymatou’s profile among its 216 million daily active users, while Ymatou will help influencers on Weibo monetize via e-commerce.

Ymatou operates on a C2C model. It hosts more than 80,000 professional buyers located in 83 countries, and carries all manner of merchandise. This setup spares Ymatou much of the effort and capital needed to build its own supply chains. The company, however, has its own logistics arm operating in 15 countries and regions, allowing cross-border parcels to arrive at end-buyers within five days. A typical buyer spends about RMB 400 on a purchase made on Ymatou. Those who have viewed live-streamed promotions can place orders that exceed RMB 1,500.

Tapping the right streamers can translate to an instant boost in business. During the Black Friday shopping festival in 2019, Ymatou teamed up with more than 300 online influencers on Douyin for a blitz of live-streamed promotions. More than 50% of Yimatou users who watched the streams made purchases, with their average spending hitting RMB 1,860. Among them, more than 10,000 users spent over RMB 10,000 each. Niurouge, the company’s new partner, was one of the influencers who were pushing sales for Ymatou during the festival.

Chinese e-commerce is a highly attractive vertical for investors. Last week, Beijing-based cross-border platform Wandougongzhu bagged a USD 48.4 million investment from Japan-based internet banking giant SBI Holdings, retail conglomerate Sugi Holdings, as well as XJ Holding, a cross-border investment vehicle of Citic Group. Wandougongzhu sells Japan-made products to Chinese consumers via its app, and represents a channel for Japanese companies seeking to enter the Chinese market.

And there has been some consolidation. In September, Alibaba acquired Kaola for USD 2 billion from gaming giant NetEase, consolidating its dominant position in China’s import e-commerce sector, with a combined market share of about 57%.

Zeng Bibo, founder and CEO of Ymatou, sees Alibaba’s acquisition as a consequence of maturing competition. He said the “first half of the race” was where various platforms connected with industries, built supply chains, gathered professional buyers, and in turn shaped the shopping experience for users. Zeng believes that Chinese e-commerce companies are now in the “second half of the race,” where it is critical to acquire more users and monetize the pool.

He said Ymatou will specifically rely on short videos and influencers to achieve that goal worldwide.

36Kr is KrASIA’s parent company.