On October 21, 2015, COFCO Womai held a press conference at the Fortune Plaza, announcing that it had raised $220 million series C funding. Upon the completion of the funding, COFCO Womai’s valuation will reach $1 billion and COFCO Group will remain its largest stakeholder. COFCO Group Chairman Frank Ning, Taikang Life Insurance Chairman & CEO Chen Dongsheng, Baidu vice president & general manager of global investment and acquisition Ye Zhuodong jointly announced the amount of this round of funding and signed an agreement of strategic cooperation.
COFCO Group Chairman Frank Ning said, “We always have this firm belief that cooperation among multiple parties to achieve a win-win situation is an inevitable path for COFCO Womai to pursue market-oriented development. The introduction of diverse capital and partners is conducive to increasing corporate management quality and operation efficiency and establishing marketized operation mechanism. The tie-up with Taikang Life and Baidu, which should be considered not only financial investment but also in-depth strategic cooperation, is a win-win that will greatly boost the development of Womai and the other parties.”
COFCO Womai CEO Zhao Pingyuan revealed that this round of funding will mainly be used by Womai to improve and upgrade its cold chain distribution system, augment categories of premium fresh foods, expand overseas direct purchase, build its own brand, enhance service experience, step up efforts to inspect and supervise food safety, further increase its competitive advantages and brand awareness, and consolidate its position as a leading brand among China’s food e-commerce operators so as to develop a social circle that extends from “eating” to “healthy consumption”.
This round of funding is led by Taikang Life Insurance with follow-on investments from Baidu, Yunlong Capital [云龙资本] and Sunshine Ronghui Capital [阳光融汇资本]. China Renaissance Partners acts as the exclusive financial advisor. Upon the completion of this round of funding, Womai will work with Taikang Life Insurance in the field of macro health service, leveraging both parties’ resource of consumers consisting of healthy population to provide nutrition and health solutions as well as financial, wealth management and insurance services. Baidu will utilize its search engine and big data to transform demand for healthy diet into accurate data flow. Womai will carry out in-depth cooperation with Baidu’s life service resources such as Nuomi and Waimai to achieve greater synergy.
In the future, Womai will invest $100 million in the expansion of its cold chain logistics system. At present, the scope of delivery of fresh food has expanded from 60 to 142 cities. It is estimated that Womai’s delivery network will cover over 300 cities by 2017.
Womai will also increase investments in food safety supervision to fully cover self-operated foods and implement stringent “double insurance” mechanism. During the goods introduction phase, the goods undergo a verification process according to “Womai Standard” besides being submitted by producers for tests; during the phase of putting goods in storage, fresh food fast test labs established at storage centers in various regions conduct random tests of batches of goods for verification so as to increase the frequency of tests and close any gap in food safety supervision.
As a B2C food e-retailer invested and established by COFCO Group in 2009, Womai received series A funding round of over ten million dollars from SAIF Partners in 2013 and completed series B funding round of $1 billion led by IDG Capital in August 2014.