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As may be evident from its store-in-store strategy and convenience store footprint, <a href="/company/cotti-coffee">Cotti Coffee</a> has never let up in its pursuit of scale.
According to multiple sources familiar with the matter, Cotti now operates more than 15,000 stores, including 3,000 that are not yet open. This figure includes standard outlets, store-in-store units, and convenience stores.
In a recent internal meeting, Cotti founder Lu Zhengyao reportedly said that nearly 90% of standard outlets posted a monthly net profit exceeding RMB 10,000 (USD 1,400) in May. Cotti refers to this threshold as the “green light” indicator.
If accurate, this 90% profitability rate suggests that the company’s aggressive delivery subsidies, implemented since April, have yielded positive results. In recent months, Cotti has ramped up efforts on delivery platforms. According to 36Kr, its total order volume on <a href="/company/jd">JD.com</a> alone has surpassed 100 million. Earlier reports indicated that in several regions, franchisees saw their order volume double while maintaining a gross margin of approximately 45%.
Cotti has also leaned on brand collaborations to drive foot traffic. Franchisees told 36Kr that the company has rolled out monthly IP partnerships this year, featuring franchises like Ne Zha, Crayon Shin-chan, and more recently, My Little Pony. The Ne Zha campaign in March, which bundled drinks with themed merchandise, was particularly effective in boosting sales. One franchisee also shared that Cotti’s sponsorship of the Argentina national football team will continue through the 2026 FIFA World Cup.
At a recent franchisee conference, the company disclosed that average operating cash flow per store in May reached RMB 27,000–28,000 (USD 3,780–3,920), marking a record high and a 40% year-on-year increase.
Store count is growing, franchisees are turning a profit, and Cotti, for the first time in a while, appears to have gained some breathing room.
Reflecting on the past year, especially the difficult winter season, the company’s main concern has been scale. Retaining and expanding its franchisee base is central to maintaining its subsidy-driven growth model. Since 2023, Cotti has also invested in supply chain infrastructure, particularly in Anhui, which requires a larger retail footprint to absorb capacity. This may help explain why Lu stated that Cotti aims to reach 50,000 stores by 2025.
When growth in standard outlets began to plateau last year, Cotti launched an initiative to open 8,000 store-in-store units in six months. However, the effort added only about 1,000 locations before it was quietly phased out due to staffing challenges and inconsistent branding.
At the time, a franchisee explained to 36Kr that sharing staff between Cotti and other in-store brands was unworkable. Having untrained personnel prepare beverages led to issues with product quality and shelf life. Budget constraints in the store-in-store model also meant there was little room to hire dedicated baristas.
Still, Cotti has never let go of its obsession with scale. This year, it shifted focus to its convenience store format, presenting it as a new driver of growth. The model offers a relatively low entry barrier: RMB 50,000 (USD 7,000) as a downpayment, with an equal deposit and the balance payable over 36 months.
Yet, no matter how many new formats Cotti experiments with, the goal of reaching 50,000 stores seems increasingly out of reach.
Cotti appears to be adjusting to this reality. Instead of chasing an unattainable number, the company is now turning its focus to improving performance at existing stores.
Earlier this year, a surge in sales was accompanied by a wave of criticism on social media. Customers complained of inconsistent product quality, unhygienic preparation areas, delivery errors, and even drinks missing their coffee shots, as some customers report receiving fruit juice after ordering lattes.
According to a source close to the company, Cotti will deploy 1,100 regional managers across the country beginning in the second half of 2025. “Cotti wanted to do this last year,” the source said, “but franchisees were seeing low volumes during the offseason. Cracking down on store operations too hard would have sparked pushback and potentially increased closure rates.”
Put differently, the pressures of Cotti’s low-price model, where a cup of coffee typically sells for RMB 9.9 (USD 1.4), has hitherto been shouldered by subsidies. The company, stretched thin, has struggled to implement a structured operational framework under these conditions. But one franchisee summarized the company’s new direction this way:
<blockquote>“Cotti’s management will be much stricter going forward. Before, it was all surveillance cameras and fines. Now, with onsite inspections, violations could lead to forced closures and restructuring.”</blockquote>
With 1,100 managers overseeing 15,000 stores, the oversight ratio would improve to about one manager per 14 outlets. A former regional manager told 36Kr that under normal conditions, one person can manage up to 30 stores. “At the peak of growth in 2024, some managers were overseeing more than 90 outlets. Operations were totally disorganized back then.”
whereRelatedArticle
The road from rough-and-ready expansion to standardized management is familiar territory for any leading coffee chain, and a welcome sign of maturity for franchisees.
Still, this moment of reprieve may not last.
Much of Cotti’s recent growth has been supported by delivery subsidies, co-funded by JD.com and the company itself. These subsidies represent a significant financial burden. With the current average price on JD’s platform just under RMB 9.9, any reduction in subsidies is likely to affect order volume. As that happens, store performance will depend more on operational discipline than promotional tactics.
Despite it all, Cotti’s fixation on scale hasn’t disappeared as competition remains ongoing. “Come winter,” one franchisee said, “there will be another shakeout. Coffee isn’t a get-rich-quick business anymore. Survival of the fittest is the only rule that still applies.”
KrASIA Connection features translated and adapted content that was originally published by 36Kr. This <a href="https://36kr.com/p/3351243013335942">article</a> was written by Zhong Yixuan for 36Kr.

After racing to 15,000 stores, Cotti Coffee gets serious about quality control

Cotti Coffee

East Asia

China

Retail

Consumer Economy

Coffee

… round was led by Yifeng Capital, with participation from existing investors Qiming Venture Partners and Huangpu Medical Fund. Poseidon Hill Capital acted as the financial advisor. Tingsn will use the funding to advance R&amp;D and clinical validation for its 4D intracardiac echocardiography products. —<a href="https://36kr.com/p/3350605027633792">36Kr</a></li>
</ul>
whereRelatedArticle
<h3>Salmon, InstaPay, 10Ants, and more made recent headlines:</h3>
<ul>
<li aria-level="1">Salmon Group, a financial services platform, secured USD 88 million through a mix of bond and equity funding. Spice Expeditions led the equity round, joined by US institutional investors, Antler Elevate, and existing backers including the International Finance Corporation (IFC), Abu Dhabi’s Lunate, Northstar, and Back in Black Capital.</li>
<li aria-level="1">InstaPay Technologies, a Malaysia-based digital payments company, closed a Series A2 funding round, raising approximately USD 3 million. The round was led by US-based family offices, with follow-on participation from ACA Investments.</li>
<li aria-level="1"><a href="https://www.the10ants.com/">10Ants</a>, an urban revitalization startup, secured USD 500,000 in pre-seed funding from Wavemaker Impact.</li>
</ul>
If there are any news or updates you'd like us to feature, get in touch with us at: <a href="mailto:hello@kr-asia.com">hello@kr-asia.com</a>.
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Deals in brief: Shiok Burger and 3cat raise funding, Timah Partners gets USD 50 million to tackle SME succession, latest China deals and more

Venture Capital

Private Equity

Investment

Merger &amp; Acquisition

Singapore

Malaysia

Southeast Asia

India

… innovation with practical deployment, citing the relevance of its technology to factory operations. The company plans to support Casbot with component supply and assembly resources to help scale production while maintaining cost and quality control. It also intends to integrate Casbot into its smart manufacturing operations.
Tianjin Jiayi expressed similar views, emphasizing Casbot’s technical capabilities in mining and its ability to turn engineering expertise into sustainable business growth. “In a crowded field, we choose to back teams that truly understand both technology and the business fundamentals behind it,” the company said.
KrASIA Connection features translated and adapted content that was originally published by 36Kr. This <a href="https://36kr.com/p/3348658418310020">article</a> was written by Huang Nan for 36Kr.

China’s Casbot bags funding to build humanoid bots for tough industrial work

Deep Tech

Taking into account various factors, including market dynamics and operational performance, Damai Entertainment (formerly Alibaba Pictures) has reportedly decided to shut down Koitake, a wholly owned subsidiary. The company stated it would handle post-closure matters appropriately.
According to sources familiar with the situation, one key reason for the closure was underperformance. Koitake’s revenue contribution was characterized as minimal compared to the broader operations of <a href="/company/alibaba">Alibaba’s</a> Hujing Digital Media and Entertainment Group.
As reported by 36Kr, the shutdown and associated layoffs proceeded swiftly. Most of the team was notified on the same day, with only a few staff members retained for transitional tasks. Their long-term status has yet to be determined.
Koitake and Alifish were the two main business lines derived from intellectual property under Damai. Koitake focused on designer toys based on the company’s IP portfolio, utilizing both proprietary and distribution channels. In contrast, Alifish functions as a transactional platform centered on IP operations, licensing, and commercialization.
In the years prior to its closure, Koitake invested heavily in original IP development and merchandise tied to popular media. Over the recent Dragon Boat Festival holiday, the brand even participated in the Toy Heart Expo, a well-known designer toy convention.
Its bestselling product was a blind box series based on Empresses in the Palace, a historical drama. When the line launched in 2022, it consistently ranked among the top ten in Tmall’s blind box sales.
Outside of media collaborations, Koitake developed more than ten original designer toy IPs, based on publicly available information. However, aside from the Empresses in the Palace collection, none achieved meaningful commercial traction.
In 2024, Koitake generated less than RMB 500 million (USD 70 million) in revenue. In comparison, Hujing recorded RMB 22.267 billion (USD 3.1 billion) in Alibaba’s fiscal year 2025 earnings report, with Koitake accounting for just 2% of total revenue.
The closure also reflects broader restructuring within Hujing.
On May 21, Alibaba rebranded its digital media and entertainment arm as Hujing, with Alibaba Pictures renamed Damai. In an internal memo, the company described the move as part of its broader “return-to-roots” strategy and framed it as a way to “start anew.”
This pivot reflects a gradual shift in focus from traditional film ventures toward higher-margin areas, such as live events and IP merchandise.
In fiscal 2025, Alibaba Pictures posted RMB 6.702 billion (USD 938.3 million) in revenue, up 33.1% year-on-year. Of this, Damai contributed RMB 2.057 billion (USD 288 million), a 236% increase, while IP merchandise brought in RMB 1.433 billion (USD 200.6 million), up 73% year-on-year. Together, these two segments accounted for more than half of the company’s total revenue and were key growth drivers.
The boom is no accident. Hujing’s strategy appears calibrated to two industry trends: a stagnant film sector and a burgeoning designer toy market led by players like Pop Mart.
In this context, shuttering Koitake may be viewed as a pragmatic move that reflects the company’s focus on streamlining operations. After all, while many entertainment firms want a piece of the designer toy pie, not every brand can be the next Pop Mart.
KrASIA Connection features translated and adapted content that was originally published by 36Kr. This <a href="https://36kr.com/p/3352666937406084">article</a> was written by Lan Jie for 36Kr.

Alibaba dials back designer toy ambitions, shuts Koitake to sharpen focus

Entertainment

Creative

… sizes="(max-width: 1920px) 100vw, 1920px" /><figcaption id="caption-attachment-155036" class="wp-caption-text">Lululemon brought together ten women (pictured) from its global ambassador collective, representing the Asia Pacific and North America, to run a six-day ultramarathon as part of its Further initiative. Photo and header photo courtesy of Lululemon.</figcaption></figure>
<h3>36Kr: Will athlete co-creation continue to play a role in future development?</h3>
CM: Absolutely. It’s part of our brand DNA. Like I said, everything we do starts with listening. And we have deep, longstanding partnerships with elite athlete ambassadors across the world.
Their voices are involved at every stage: identifying unmet needs, setting design goals, testing early versions, giving feedback. With the Go Further bra, we formed a core co-creation team of top-tier women athletes who push boundaries.
This kind of collaboration isn’t a special case, it’s built into our entire process. Testing products in real-world conditions is the only way we can know if an innovation delivers on its promise. It’s how we work on every product.
<h3>36Kr: How do these use cases translate to everyday consumers?</h3>
CM: The lessons apply directly. We take in all the feedback and refine the product with the athlete in mind, but it benefits everyone.
The six-day ultramarathon pushed our team to think through every detail, such as how we could add new tech, materials, and structure.
Because when you're in an extreme event, even a small discomfort can snowball under pressure. That forces us to fix every unmet need, every rough edge. We design under a microscope.
And when something passes that kind of stress test, it raises the bar for everyday wear. If it’s comfortable after six days of nonstop running, it’ll feel great on your daily run, too.
<h3>36Kr: Why sports bras?</h3>
CM: Lululemon has been innovating in this space since day one. Supporting women has always been core to our mission.
Even before I joined the team over a decade ago, the company had already been investing in this category. It’s a longstanding commitment, and we believe it has made us a real leader in the field.
In the past ten years, we’ve deepened our focus on breast biomechanics, looking beyond traditional ideas of support to develop entirely new frameworks using advanced science.
The Go Further bra took over two years of development. We started designing it a year ahead of the Further ultramarathon in March 2024, and launched it commercially soon after the race.
<h3>36Kr: Who is the Go Further bra designed for?</h3>
CM: It’s designed for running, specifically high-impact support. But it works for runners at any level, whether you're just starting out or competing professionally.
<h3>36Kr: Is it already in production?</h3>
CM: Yes, it’s in full production and on the market now. You could say it’s the first “seed” from the Further product line.
During that event, we developed 36 innovation pieces for the athletes. Now, we’re thrilled to bring one of them to the public. Our team is already discussing how to roll it out across more regions, with new colors and expanded designs.
<h3>36Kr: With so many product launches, what lessons have you taken from the hits and misses?</h3>
CM: We’re always asking: how can we improve what we have? What new products would customers love? How can we truly stand out?
For the Further project, we originally planned to design just one outfit per athlete. But after listening closely and forecasting their real needs, we realized that wasn’t nearly enough.
Nobody had ever done a six-day race like this. We had to create a full system of gear, not just individual pieces. That meant going from one item to 36, each one designed to meet a specific, real-world demand.
That pivot from single product to complete solution turned out to be one of the most impactful decisions we made.
<h3>36Kr: Are consumer preferences in Asia different from those in the West?</h3>
CM: In my experience, people everywhere want to feel good in their clothes. That’s universal.
We’re always expanding our product offerings to ensure better fit, style, and comfort. Every product we release is designed with those values in mind.
<h3>36Kr: Has Lululemon’s growth in China created new R&amp;D needs?</h3>
CM: Absolutely. One major area is fit. Proper tailoring is key to comfort and performance.
That’s why we introduced our Asia Fit line, with sizing and cuts specifically designed for local body types. It’s a reflection of our effort to meet regional needs and offer more inclusive sizing options.
When we hear more voices from different markets, we gain more opportunities to innovate.
whereRelatedArticle
<h3>36Kr: From your perspective, what’s the biggest R&amp;D challenge right now?</h3>
CM: The market’s always evolving, and so are customer expectations. Our job is to meet needs before they are articulated. That’s the heart of innovation.
Consumers want products that deliver on function, style, and feel. There’s so much potential left to explore.
<h3>36Kr: How do you keep your creative edge?</h3>
CM: Curiosity. We keep asking ourselves: how can we exceed expectations? How can we deliver experiences that no one’s imagined yet?
That’s what drives us.
KrASIA Connection features translated and adapted content that was originally published by 36Kr. This <a href="https://36kr.com/p/3338774321377796">article</a> was written by Li Xiaoxia for 36Kr.

Comfort and performance: Lululemon redesigns sports bras to help women go further

Asian insurers and other businesses have been helping strengthen Asian currencies in recent months by buying more protection against US dollar weakness.
These investors, who have large holdings of US bonds and other securities, had little urgency to hedge when the dollar was strong. But they are now increasing their hedge ratios to protect against a fall in the greenback. This typically involves selling the dollar for local currencies, which appreciates the latter's value.
"The Taiwanese dollar's surprise rally in early May serves as a reminder to those hoarding US dollars to manage their exposure," said Christopher Wong, a forex strategist at OCBC in Singapore.
"We believe Asian currencies can continue to appreciate so long as US dollar softness persists, owing to US-centric risks, and global growth outside the US still holds up," Wong said.
East Asian currencies have notched noticeable gains. Those of Taiwan, Japan, and South Korea have appreciated between 8% and 11% this year.
In May, a Taiwanese media report that the US would demand a stronger Taiwan dollar in a trade deal prompted the island's cash-rich corporations to convert their dollar holdings and life insurance companies to increase hedge ratios. Taiwanese authorities denied such a trade deal.
The Taiwan dollar surged a near record 10% in two business days <a title="" href="https://asia.nikkei.com/Business/Markets/Currencies/Taiwan-dollar-rises-at-fastest-pace-in-decades-threatening-tech-profits" target="_blank" rel="noopener">in early May</a>, underscoring a broader diversification away from the US and highlighting Asia's large dollar assets.
Taiwan's holdings of US stocks and US bonds are equivalent to more than 90% of its gross domestic product, followed by Japan at around 60% and Australia and South Korea, both with holdings exceeding 30%, according to Bank of America Global Research.
The "diversification away from US dollar assets" will be a key theme that will continue to drive most Asian currency markets over the coming months, Gek Teng Khoo, a strategist at Morgan Stanley, said in a report. He said that he expects Asian currencies, excluding the Japanese yen, to appreciate by up to another 3% over the next 12 months.
Currency hedging aims to protect assets from fluctuations in exchange rates. Hedging costs are influenced by short-term interest rate differentials between currencies. The US federal funds rate target range remains 4.25–4.50%. This is higher than South Korea's 2.5% interest rate, Taiwan's 2% and Japan's 0.5%. Rate differentials between the US and Asia mean hedging costs remain high.
"While [Taiwanese] life insurers have some flexibility to maneuver their hedging ratios within their mandates, broader changes don't happen over a week or so," said Chidu Narayanan, head of macro strategy for Asia Pacific at Wells Fargo in Singapore. But "it is another factor that will be very important to watch going forward, especially in Northeast Asia foreign exchange."
While no other country "comes close" to Taiwan's scale of US assets, Japan, Australia, and South Korea also have "meaningful" holdings, said Bank of America Securities strategists in a report. "Portfolio hedge ratio dynamics will be key for these countries, although they are unlikely to lead to the kind of disorderly forex adjustment observed in the Taiwanese dollar."
Japan is the largest overseas holder of US Treasuries, with USD 1.1 trillion as of March. Japanese life insurance companies are major holders of US debt. Currency hedge ratios at large Japanese insurers are at a "historically low level" of around 30%, said Kenta Tadaide, chief FX strategist at Daiwa Securities, in a note.
The yen's appreciation to 140 to the dollar could prompt exporters to hedge their exposure, while causing life insurance companies to buy US assets, the BofA Securities strategists said. The yen traded in the mid-145 level as of June 13.
Hedging costs using currency forwards, which lock in future exchange rates, remain "stubbornly high" for Japanese investors, said an official from an international bank in Japan. This has led investors to prefer currency option-based hedging, which gives investors the alternative to use a set exchange rate in the future, the official said.
Exporters' conversion of their dollar-based export proceeds into local currency would help strengthen Asian currencies, Morgan Stanley's Khoo said.
Onshore foreign currency deposits in Asia's emerging market economies have increased across the board over the past three years, Khoo said. He added that Thailand's foreign currency deposits have doubled over the past three years, followed by Malaysia (34%) and the Philippines (31%).
Most emerging market Asian investors are expected to <a title="" href="https://asia.nikkei.com/Business/Markets/Tariff-swings-prompt-repositioning-in-Asian-assets" target="_blank" rel="noopener">reallocate their dollar investments</a> into "other large, liquid markets like Japan" rather than repatriate to local <a title="" href="https://asia.nikkei.com/Business/Markets" target="_blank" rel="noopener">markets</a>, Khoo said.
While structural diversification away from the US is already in motion, the pace of change is expected to be gradual.
"It's very hard to find an immediate alternative for the entirety of their dollar exposure, so we don't see dramatic reductions happening," Wells Fargo's Narayanan said. "That said, we expect a slow reduction of overweight US dollar investment positions."
This article first appeared on <a href="https://asia.nikkei.com/Business/Markets/Trading-Asia/Asia-s-dollar-hedging-seen-boosting-regional-currencies">Nikkei Asia</a>. It has been republished here as part of 36Kr’s ongoing partnership with <a href="https://www.kr-asia.com/nikkei-teams-up-with-36kr-in-asia-tech-news-coverage/">Nikkei</a>.

Asia's dollar hedging seen boosting regional currencies

Japan

South Korea

Central Asia

Australia

New Zealand

Hong Kong

Oceania

Wu Dezhou, originally from Ningde, Fujian, embodies the resilience often associated with the province’s entrepreneurial culture. Over the past decade, he has moved from leading <a href="/company/huawei">Huawei’s</a> Honor product line to serving as vice president of hardware R&amp;D at Smartisan, and later as president of Newstone Lab at <a href="/company/bytedance">ByteDance</a>. But through each professional chapter, the idea of launching his own venture never left him.
In 2022, Wu left ByteDance to start <a href="https://www.arknovv.com/">ARknovv</a>, a company developing smart glasses. The move placed him among a growing group of Chinese entrepreneurs, among them longtime collaborator Luo Yonghao, chasing what many believe could be the next frontier in consumer tech.
Wu is perhaps best known for his time at Smartisan, a brand that hasn’t released a phone in nearly five years but still garners nostalgic comments on his Weibo posts. That experience, he said, helped shape his entrepreneurial instincts. At Smartisan, he learned how to build products with limited capital, manage investor expectations, and balance idealism with pragmatism.
When Wu sat down for this interview with 36Kr, he was dressed in a simple blue cycling shirt. He recently picked up cycling to better understand his user base and now rides daily. The habit has not only slimmed his figure, but also inspired a fitness trend among his company’s product team.
<figure id="attachment_154995" aria-describedby="caption-attachment-154995" style="width: 1920px" class="wp-caption alignnone"><img loading="lazy" decoding="async" class="size-full wp-image-154995" src="https://console.kr-asia.com/wp-content/uploads/2025/06/ARknovv-Wu-Dezhou.jpg" alt="Photo of Wu Dezhou, founder and CEO of ARknovv." width="1920" height="1280" srcset="https://console.kr-asia.com/wp-content/uploads/2025/06/ARknovv-Wu-Dezhou.jpg 1920w, https://console.kr-asia.com/wp-content/uploads/2025/06/ARknovv-Wu-Dezhou-720x480.jpg 720w, https://console.kr-asia.com/wp-content/uploads/2025/06/ARknovv-Wu-Dezhou-1024x683.jpg 1024w, https://console.kr-asia.com/wp-content/uploads/2025/06/ARknovv-Wu-Dezhou-768x512.jpg 768w, https://console.kr-asia.com/wp-content/uploads/2025/06/ARknovv-Wu-Dezhou-1536x1024.jpg 1536w" sizes="(max-width: 1920px) 100vw, 1920px" /><figcaption id="caption-attachment-154995" class="wp-caption-text">Photo of Wu Dezhou, founder and CEO of ARknovv. Photo source: ARknovv via 36Kr.</figcaption></figure>
More than a pastime, cycling is the main use case for BleeqUp, ARknovv’s newly launched sub-brand.
Unlike companies like RayNeo, Sharge, or Rokid that are building smart glasses for general use, BleeqUp focuses on vertical integration in sports. Its first product, the BleeqUp Ranger, is an <a href="/industry/ai">artificial intelligence</a>-powered pair of sport glasses designed for outdoor activities like cycling and hiking. It’s set to launch overseas at the end of June.
From afar, the BleeqUp Ranger looks like a typical pair of cycling sunglasses. But several design choices distinguish it:
<ul>
<li aria-level="1">The camera is mounted in the center, allowing for optimal recording angles, unlike side-mounted lenses common in competing products.</li>
<li aria-level="1">It uses physical buttons for capturing photos and videos, avoiding gesture controls that can falter during high-speed movement.</li>
<li aria-level="1">It features double the usual number of speakers to ensure audio clarity, even at speed.</li>
<li aria-level="1">It automatically records video during sudden braking or collisions to help with incident analysis.</li>
</ul>
Meta is reportedly working with Oakley on a similar sports eyewear product for release next year. While both are targeting comparable scenarios, BleeqUp’s product will hit the market first.
Wu is clear about what gives startups a fighting chance. General-purpose AI glasses, he argues, operate too close to smartphone territory—an area dominated by companies with vast resources, years of imaging R&amp;D, and tight control over mobile ecosystems. That’s not a fight startups can win.
In Wu’s view, AI glasses will eventually evolve into personal digital assistants. But without full integration with smartphones—for tasks like booking flights, ordering food, or taking voice notes—the experience will likely fall short.
Phone makers haven’t fully entered the space yet, but Wu is certain that when the time is right, they will dominate. “Whether they enter six months earlier or later doesn’t matter,” he said. “When this market matures, it will be a full-stack competition. And on that front, phone companies have a crushing structural advantage.”
That’s why ARknovv is focusing on vertical markets.
To illustrate, Wu points to Garmin, which has held its ground in the sports watch market despite competing offerings introduced by Apple and Huawei. Garmin’s strength lies in building deeply specialized products for elite athletes, be it divers, trail runners, or climbers. Where mass market players prioritize sleekness and general appeal, Garmin packs in functional details like waterproofing, decompression algorithms, and emergency flashlights. That, Wu said, is the model ARknovv wants to follow: to make BleeqUp the Garmin of AI glasses.
Analysts expect 2025 to be a pivotal year for AI glasses, with nearly 100 brands joining the fray. These include hardware giants like <a href="/company/xiaomi">Xiaomi</a>, Samsung, and <a href="/company/lenovo">Lenovo</a>; tech firms like ByteDance and <a href="/company/baidu">Baidu’s</a> Xiaodu; and startups such as RayNeo and Lawaken.
But Wu believes that first-mover advantage and hardware experience aren’t enough. What matters most, he said, is choosing the right niche, understanding the user deeply, and refining the product with precision.
“All of our product decisions—features, specs, everything—are made with the athlete in mind,” he said. “As we iterate, we’ll learn more and more about users. The better we get at serving them, the more likely it is that we’ll win their loyalty. That will be our moat.”
KrASIA Connection features translated and adapted content that was originally published by 36Kr. This <a href="https://36kr.com/p/3341154651011586">article</a> was written by Wang Fangyu for 36Kr.

The Garmin of AI glasses? ARknovv’s smart specs are built for athletes, not the masses

Artificial Intelligence

Even today, when people think of "new consumption" in China, they often recall the funding stories from the last boom cycle. Among them, the specialty coffee wave stood out. Several boutique coffee brands that combined quality and aesthetics gained attention during that period, and Algebraist Coffee was one of the few that rose with relative ease.
Founded in 2015, Algebraist became known for its distinctive coffee and minimalist store design. Between 2019–2022, it completed four funding rounds: angel investment from Wuyuan Capital in 2019, a Series A round from Genesis Capital in 2020, followed by investments from Tencent and a new round from Oriza Holdings in 2021.
Those peak years were dazzling. “At that moment, everyone ignored the cost structure and mistook brief glory for a sustainable business model,” Algebraist founder Dai Yi said. As market conditions shifted, the experience brought hard lessons. “I no longer envy others who rapidly roll out stores. Keeping our company alive and in the black each month—that’s what really matters.”
Today, as the industry is shaped by rapid expansion and price competition, and major players like <a href="/company/luckin-coffee">Luckin Coffee</a> and <a href="/company/cotti-coffee">Cotti Coffee</a> capture attention, what’s happening to those outside the spotlight?
According to 36Kr, Algebraist Coffee secured a new funding round earlier this year worth an eight-figure RMB sum, led solely by SND Financial Holdings. Its total funding now exceeds RMB 200 million (USD 28 million). Notably, the company turned a monthly profit and achieved positive cash flow starting in the third quarter of 2024, with performance improving each month. The latest funding, the company emphasized, is primarily intended to support brand and product development, rather than sustain day-to-day operations.
Looking back, timely adjustments and steady growth helped Algebraist navigate the downturn.
At the height of its expansion before the pandemic, Algebraist had signed leases and begun renovations for more than 170 directly operated stores. However, 80 of those—still unopened—were canceled due to the pandemic. “If we had gone all-in on expansion back then, we might not be here today,” Dai said. Algebraist was also among the first of the leading coffee brands to publicly announce a contraction plan.
Today, Algebraist sees itself as a “consumption upgrade for the mass market.” While maintaining its identity as a serious coffee brand, it has worked to streamline pricing, control costs, and improve supply chain efficiency. According to 36Kr, customers have praised its regularly updated product lineup. Kiri, its French cheese latte series, sold 117,000 cups in its launch month. The rose breve latte, first introduced in 2019, continues to be one of the brand’s most frequently repurchased drinks, with over 650,000 cups sold in 2024.
<figure id="attachment_154950" aria-describedby="caption-attachment-154950" style="width: 1920px" class="wp-caption alignnone"><img loading="lazy" decoding="async" class="size-full wp-image-154950" src="https://console.kr-asia.com/wp-content/uploads/2025/06/Algebraist-Coffee-Products.jpg" alt="" width="1920" height="1080" srcset="https://console.kr-asia.com/wp-content/uploads/2025/06/Algebraist-Coffee-Products.jpg 1920w, https://console.kr-asia.com/wp-content/uploads/2025/06/Algebraist-Coffee-Products-720x405.jpg 720w, https://console.kr-asia.com/wp-content/uploads/2025/06/Algebraist-Coffee-Products-1024x576.jpg 1024w, https://console.kr-asia.com/wp-content/uploads/2025/06/Algebraist-Coffee-Products-768x432.jpg 768w, https://console.kr-asia.com/wp-content/uploads/2025/06/Algebraist-Coffee-Products-1536x864.jpg 1536w, https://console.kr-asia.com/wp-content/uploads/2025/06/Algebraist-Coffee-Products-480x270.jpg 480w" sizes="(max-width: 1920px) 100vw, 1920px" /><figcaption id="caption-attachment-154950" class="wp-caption-text">Image and header image source: Algebraist Coffee via 36Kr.</figcaption></figure>
Beyond product development, Dai has focused more on operational details such as store format, staffing, and supply chain costs. “Everyone’s managing in finer detail now,” he said. “But at the core, we have to return to product quality and consumer needs. Even store location choices should start from what’s most convenient for the customer.”
In March 2024, Algebraist launched its partner entrepreneur program, shifting from a purely self-operated model to one that includes franchising. Today, the brand opens around eight to ten stores per month. Its total store count has surpassed 150, with franchise stores now forming the core of its business model. Compared to industry expansion rates, Algebraist’s approach is measured.
“We have internal thresholds and guiding principles,” Dai told 36Kr. “At this stage, we haven’t seen a clear psychological or behavioral shift in consumer sentiment that would justify a major pivot. So we’re focused on operating the brand more steadily.”
For now, the brand remains strongest in Jiangsu, Zhejiang, and Shanghai. It is exploring expansion into other regions but is doing so cautiously.
Not every specialty coffee brand from the previous wave has endured. Some have disappeared, while others are still trying to adapt amid stiff competition. In his conversation with 36Kr, Dai repeatedly returned to basic principles:
<blockquote>“Make great products. Build a solid team. Be the kind of brand more people like and trust.”</blockquote>
One thing is clear: China’s coffee market continues to expand, as demand for quality brews remains strong. For brands like Algebraist, the priority is staying in the game, waiting for the right moment to play their next hand.
KrASIA Connection features translated and adapted content that was originally published by 36Kr. This <a href="https://36kr.com/p/3347826777660033">article</a> was written by Ren Cairu for 36Kr.

Profit over pace: Algebraist Coffee finds footing after China’s coffee shakeout

When the lights came on, Zhang Liaoyuan, founder of Three Squirrels, appeared center stage in a tuxedo, baton in hand.
This was the scene at the ecosystem conference recently hosted by the company. After weathering years of darkness and dragging the company back from its lowest point, Zhang finally seemed at ease again.
Looking back, 2019 was a peak year: Three Squirrels had gone public on the A-share market and became the first snack brand in China to exceed RMB 10 billion (USD 1.4 billion) in annual revenue. But as Zhang alluded to before, this was also the beginning of a reversal. What followed was a four-year decline, marked by sliding revenues and shrinking profits.
As the company’s figurehead, Zhang spiraled into deep anxiety and insomnia. “Whatever I did, it felt like the wrong move,” he said.
Everything began to shift at a senior management meeting at the end of 2022. Gone were the postures of strength. After three days and nights of intense discussion, the team came to a consensus: the problem wasn’t the product, but the price. Three Squirrels was selling snacks that were simply too expensive.
This insight marked a turning point. The company pivoted to a new focus on being value-for-money, and expanded its sales footprint beyond <a href="/company/jd">JD.com</a> and Taobao to platforms like <a href="/company/douyin">Douyin</a> and <a href="/company/pinduoduo">Pinduoduo</a>. By 2024, Three Squirrels had returned to RMB 10 billion in annual revenue.
Among all the channels, Douyin played a critical role. In 2023, sales from Douyin hit RMB 1.2 billion (USD 168 million), and in the following year surged to RMB 2.2 billion (USD 308 million), surpassing the brand’s Tmall performance for the first time.
For Zhang, making Douyin work came to symbolize the company’s rebound. Yet, he insisted, it wasn’t Douyin itself that mattered most, but the methods rediscovered by the firm and the organizational discipline to execute them.
Armed with those insights, Three Squirrels is now venturing into new territory. The company has launched 33 proprietary brands spanning pet food, supplements, convenience meals, coffee, and feminine care. It’s also planning to open convenience stores and lifestyle shops.
In Zhang’s long-term vision, Three Squirrels will evolve into an integrated powerhouse of manufacturing, branding, and retail: a super supply chain company.
And if the plan fails?
“Then it fails. We’ll adjust.”
The following transcript has been edited and consolidated for brevity and clarity.
<h3>36Kr: Did Douyin play a crucial role in pulling Three Squirrels out of the downturn?</h3>
Zhang Liaoyuan (ZL): Douyin was important, but not for the reasons people think. What really mattered was that we discovered the right way to operate.
<h3>36Kr: What kind of decision-making went into that shift?</h3>
ZL: We had succeeded on Tmall and JD.com and thought of ourselves as winners. That mindset made us resistant to change. Before 2022, every attempt we made on Douyin or Pinduoduo failed. We didn’t want to adapt.
It wasn’t until we hit rock bottom that we realized we had no choice. We had to shed the old strongman mentality. The “Tao Te Ching” says the way of strength is to act from weakness. True strength lies in yielding, in aligning with the natural order.
We changed nearly everything: pricing, profit structures, organizational systems. We simplified our product development process drastically.
<h3>36Kr: What exactly were you reluctant to adapt to on Douyin and Pinduoduo?</h3>
ZL: They are dominated by white-label products with low prices. We assumed we couldn’t compete. But instead of rejecting it outright, we should’ve asked: why can others succeed where we can’t?
For example, others ship directly from factories while we had shipped everything to a warehouse first, which added costs. Their boxes cost RMB 0.8 (USD 0.11), and ours cost RMB 1 (USD 0.14). We were too proud to notice.
And for a decade-old company with thousands of employees, change is hard. Initially, we hired a consulting firm, ran constant workshops and transformation sessions, but things only got worse. Eventually, we abandoned big slogans and focused on small changes, small units, small wins. That’s when we realized we had to govern like underdogs.
<h3>36Kr: Without that downturn, would these changes have happened?</h3>
ZL: Definitely not. That’s human nature. In 2017 and 2018, we were flying high. We thought everything we did was right, but in truth, we just happened to be riding a wave.
Rock bottom brings two outcomes: death or rebirth. Maturity only comes after you survive the fire.
<h3>36Kr: When did you realize Three Squirrels’ prices were too high?</h3>
ZL: We had a three-day executive meeting. After dissecting every layer of the business from raw materials to logistics, we reached a consensus: we were overpriced. Fixing that meant decentralizing authority and sending top executives into the trenches. That’s what ultimately led us to Douyin.
<h3>36Kr: Didn’t you already know the prices were high?</h3>
ZL: We knew. But after spending more than a decade to build our brand, it takes real courage to suddenly go mass market.
At the time, we ignored the white-label and challenger brands. Then our mindset shifted: forget whether they seem legitimate and just try the products. If someone’s selling mixed nuts for RMB 19.9 (USD 2.8) and ours are only 20% better but priced at RMB 59.9 (USD 8.4), that’s still overpriced. Why not go for RMB 39.9 (USD 5.6) with better quality?
It’s a simple logic, but we had been too rigid.
<h3>36Kr: How do you ensure price competitiveness now?</h3>
ZL: Through innovation in our model. We’re building centralized supply chain hubs in Wuhu, Tianjin, Chengdu, and Foshan. Wuhu is nearly complete, with seven factories and 17 production lines covering 65% of our snack products.
We manufacture nuts in-house. For everything else, we co-invest with top-tier suppliers. Products go straight to nearby consumers, which shortens transport distances and cuts costs. We control the full production cycle and get cost savings at every step, whether that’s on materials, operations, or even R&amp;D feedback.
KrASIA Connection features translated and adapted content that was originally published by 36Kr. This <a href="https://36kr.com/p/3330822185822722">article</a> was written by Li Xiaoxia for 36Kr.

From slump to RMB 10 billion comeback: How a Chinese snack brand found new life in social commerce