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Online group-buying platform Tongcheng Life closes USD 200 million fundraising

A clutch of grocery e-retailers have raised fresh capital in the post-coronavirus era.

Photo by leonie wise on Unsplash

Tongcheng Life, a Suzhou-based community group-buying platform, has secured USD 200 million in its latest fundraising round, led by entertainment company Joyy Inc (NASDAQ:YY), with the participation of existing backers including Legend Capital, Bertelsmann Asia Investment Fund, Yilian Capital, and Tongcheng Capital, 36Kr reported on Thursday.

The online-to-offline community group-buying platform, founded in 2018, is a spinoff of the online travel agency Tongcheng Elong (HK: 0780). It operates a mini-program in WeChat for residents who live in the same neighborhood to buy groceries and other commodities at a discounted price.

The company fetched a post-round valuation of over RMB 5 billion (USD 710 million), according to Tongcheng founder Wu Zhixiang. In September, Tongcheng Life closed its Series B round raising USD 100 million, KrASIA wrote.

David Li Xueling, the CEO of Joyy Inc said in an internal meeting that it’s the company’s largest investment in the life services sector, The Beijing News wrote. Joyy Inc houses Bigo Live, social gaming app Hago, game-centric livestreaming platform Huya, and short-video app Likee.

The community group-buying sector has drawn a bulk of fresh capital in recent months, propelled by its phenomenal growth during the COVID-19 pandemic, as home-bound residents relied on this way of shopping to get food and other household necessities.

Earlier this month, Beijing-based online group-buying platform Nice Tuan closed a USD 81.4 million Series C1 round led by GGV Capital, which came shortly after a USD 88.3 million round closed in January, KrASIA wrote.

In May, on-demand grocery delivery startup MissFresh closed a new round of financing, bagging USD 500 million from investors including CICC Capital, Bloomberg reported. MissFresh’s founder claimed on GGV Capital’s podcast that the startup saw its gross merchandise volume triple in February and March of this year.