Chapter 195: 500 Million Financing, the Food Delivery War Is About to Begin!

The CEO position at KuaiPao changed hands without a sound.

Before the Spring Festival, Pei Yi led his team to continue expanding KuaiPao's presence in the Lucheng food delivery market.

The number of official riders in the delivery department surged from over 90 to more than 500, and there was also a part-time delivery team of over 600 to ease peak-hour delivery pressure.

Normally, with KuaiPao's daily order volume, at least 1, 00 delivery riders would be needed to handle 100, 00 orders.

But currently, 70% of orders come from within the first ring road; KuaiPao's operational scope is highly concentrated, and with its intelligent delivery system, it barely maintains delivery timeliness.

Once business expands to more distant areas, the current system and capacity will face severe tests, and delivery delay rates will likely rise sharply.

Without timely expansion of capacity and algorithm optimization, even massive subsidies to attract new users will fail to sustain the rapid growth in orders, and declining delivery experience will cause user attrition.

Thus, despite the year-end rush, KuaiPao's HR department is still urgently recruiting, with over 50 new employees joining daily.

These recruits include both former 24Quan ground promotion staff and R&D engineers from Manshuo and GaoPeng.

During the Thousand Group Battle, countless group-buying websites shut down each month.

They continuously supplied society with outstanding talent.

KuaiPao seized this opportunity to enter a golden phase of growth; for grassroots promoters, food delivery and group-buying had no industry barriers.

Their operational models were nearly identical; after joining KuaiPao, they could immediately replicate their previous group-buying merchant resources one-to-one into KuaiPao.

One could even say the rate of group-buying website closures was inversely proportional to KuaiPao's merchant growth trend.

On the other side.

KuaiPao's recent progress naturally caught Ma Wenteng and Liu Zhiping's attention.

"This kid's a real pain—he dragged Penguin around in circles and wouldn't budge on even 5% equity."

Ma Wenteng sat in his office, laughing as he cursed.

"It's not that bad—if he spoke up, he clearly wants financing; it's just a matter of price."

"I valued KuaiPao at 300 million, but he turned right around and opened an entry point on Pinbei, boosting KuaiPao's daily orders to the 100, 00 level."

Liu Zhiping shook his head, equally exasperated.

He'd figured it out: whenever Chen Yan's project was involved, if you didn't offer three to five times the premium, he wouldn't accept financing.

"Have Lin Chenfeng reassess KuaiPao based on current order volume and complete financing as soon as possible."

Ma Wenteng instructed; he didn't want to miss the best opportunity to invest in KuaiPao.

After all, DST and Jinsha Capital both showed strong interest in investing in KuaiPao.

If Penguin hesitates further, Chen Yan might just choose another VC.

"I understand," Liu Zhiping nodded.

Meanwhile.

Zhu Xiaopeng of Jinsha Capital, Zhou Shouzhi of DST, and Shen Nanpeng of Sequoia Capital all received updates on KuaiPao.

They hadn't expected that the once-overlooked food delivery model, when collided with traffic and capital, could unleash such astonishing growth potential.

After some thought, Zhou Shouzhi called Chen Yan and offered to invest at a 1-billion-yuan valuation.

Chen Yan smiled and politely declined.

DST had indeed invested in many domestic internet companies, but beyond capital, it couldn't provide KuaiPao with any additional growth nutrients.

And Chen Yan didn't lack money.

Zhou Shouzhi could only reluctantly withdraw from KuaiPao's Series A financing round; as for Ele. e, he'd considered it privately, but after on-site inspection, he abandoned it outright.

Compared to KuaiPao, Ele. e lagged far behind in delivery timeliness, order processing systems, and rider team building.

After receiving 1 million USD from Jinsha Capital, Zhang Xuhao only upgraded the website and poured excessive funds into technical engineers, product managers, and marketing staff.

But Ele. e utterly failed at ground promotion BD, which Zhou Shouzhi valued more.

As a food delivery platform linking users on one end and merchants on the other, Ele. e had no outstanding achievements in either area—Zhou Shouzhi naturally had no interest.

This was also why Zhu Xiaopeng refused to invest further in Zhang Xuhao.

At this moment, Zhang Xuhao sat nervously in the reception room of Ali Strategic Investment & Cooperation Department.

Under KuaiPao's pressure, he had exhausted his network of Jiaotong University alumni but secured not a single yuan in financing.

So he turned his gaze to Hangcheng's financiers.

Creak.

The door was pushed open.

Zhang Xuhao immediately stood up and stepped forward to greet.

At the door stood a bald middle-aged man in a blue suit, flanked by two assistants.

"Director Ji, it's an honor to meet you!" Zhang Xuhao bowed slightly, offering a flattering greeting.

At this time, the true head of Ali Strategic Investment was Cai Xin; Ji Gang was merely the general manager, not yet in charge.

But for an investment case like Ele. e, Ji Gang had full authority to decide.

"Mr. Zhang, please sit."

Ji Gang smiled and replied.

Before deciding to meet Zhang Xuhao, he had studied Ele. e and KuaiPao; he was genuinely interested in this O2O model distinct from group-buying, and his direct superior Cai Xin also believed food delivery held growth potential in the local life sector.

Because Chen Yan had allied with Jingdong to compete with Taobao for e-commerce market share, Ma Liyun and Cai Xin didn't want to invest in KuaiPao.

So they turned their attention to Ele. e.

"Director Ji, here is Ele. e's business plan. As of December 31, Ele. e had 67, 00 registered members, with daily orders hovering around 10, 00."

Zhang Xuhao cautiously handed over a document and explained slowly.

"Do you have confidence in defeating KuaiPao?" Ji Gang took the document, glanced at it for over ten minutes, then suddenly asked.

Zhang Xuhao paused, then quickly recovered, speaking with firmness: "Ele. e only lacks expansion capital compared to KuaiPao. If Ali invests in Ele. e, I guarantee we'll surpass KuaiPao within three months."

Entrepreneurs must never show fear before battle; Zhang Xuhao's words earned Ji Gang's silent approval.

In terms of product accumulation, Ele. e had operated for three years; its technical expertise in order and delivery systems was likely stronger than KuaiPao's.

"If Ali gives you 50 million, how much equity are you willing to give up?" Ji Gang put down the document and looked at Zhang Xuhao.

In his view, given Ele. e's current scale and premium factors, its valuation couldn't exceed 200 million.

So if Zhang Xuhao offered less than 10%, Ji Gang would walk out immediately.

His bottom line was 30%.

From Ji Gang's perspective, Ele. e was merely a small platform with daily orders just breaking 10, 00.

If Chen Yan hadn't popularized the food delivery concept, Ji Gang would have driven the price down even harder.

Zhang Xuhao fell silent.

He didn't yet know Chen Yan was about to inject 200 million into KuaiPao; he believed 50 million was sufficient for Ele. e's future development.

But he only wanted to sell 15% equity.

"Director Ji, I only need 30 million in funding, in exchange for 15% of Ele. e's equity."

After quick thought, Zhang Xuhao replied directly.

"KuaiPao's customer acquisition cost is around 15 yuan; 30 million can buy only 2 million new customers—you can't even capture Shanghai's food delivery market, so how do you compete with KuaiPao?"

Ji Gang shook his head, rejecting Zhang Xuhao's proposal.

"What about 20%?" Zhang Xuhao probed.

"30%! I don't think Ele. e's valuation can reach 250 million," Ji Gang said coolly.

30%?

Zhang Xuhao shook his head rapidly; Jinsha Capital had taken 20% in the seed round—if he gave Ali another 30%, the founding team's equity would drop below the 50% warning line.

What about future Series A, B, and C rounds?

After over two years of operational research, he knew well that users had low acceptance of food delivery and required massive funding to cultivate the market and educate consumers.

If he accepted Ali's offer, he would likely lose control.

But if he refused Ali, Ele. e would almost certainly not survive the first half of 2012.

"25%. That's my limit. If Director Ji disagrees, I'd rather give up Ali's financing."

After a moment's thought, Zhang Xuhao sighed and spoke firmly.

"OK, I can roughly accept this number, but whether the group approves it still depends on you returning to prepare financial and operational reports for Ali's venture capital department to review."

Ji Gang nodded, then added with a smile.

"I understand," Zhang Xuhao said, exhaling in relief.

At the very least, with this funding, Ele. e could survive the winter and, come spring, hold onto Shanghai's food delivery market and accelerate expansion.

……

……

Lucheng, Central Office.

After explaining the rationale, Meng Yuanzhi handed the decision to the heads of Lucheng Construction Investment and Xincheng International.

These two local investment firms held nearly 20% of Jingdongfang's equity.

Chen Yan's request could only be realized if he convinced these two.

"I disagree! Orange Tech is, at its core, just a phone assembly factory—its value is far below Jingdongfang. We have no reason to sacrifice the main for the minor."

Wang Qingsheng of Lucheng Construction Investment refused outright.

Meng Yuanzhi frowned, displeased.

Xu Minggang of Xincheng International immediately understood Meng Yuanzhi's intent and smiled:

"Director Wang, Orange Tech does have its own patented technologies—like AuroraOS, battery management, global gesture controls, and fast charging—but I also disagree with directly transferring equity to Senlian Capital; let them exchange equity for Orange Tech's shares."

Upon hearing this, Meng Yuanzhi's eyes lit up—he thought Xu Minggang's idea was excellent.

This way, Jingdong and Orange Tech can be deeply intertwined, better serving Lucheng's overall interests.

"If it's an equity swap, I have no objection," Wang Qingsheng said, glancing at Meng Yuanzhi's expression, then at Xu Minggang, before finally agreeing.

Jingdong's total market capitalization is around 60 billion, and Senlian Capital has purchased 4. % from the open market.

Since it did not cross the 5% disclosure threshold, the outside world does not know that Orange Tech has already begun positioning its supply chain to reduce material costs.

"Since neither of you objects, let's leave it at that for now—the rest we'll discuss when we meet."

Meng Yuanzhi made the final decision, sealing the deal.

That afternoon, Chen Yansen received a callback from Tao Jingwen, who proposed an equity swap cooperation plan.

After a moment's thought, Chen Yansen readily agreed.

After setting the time for negotiations, Chen Yansen hung up the phone.

He planned to wait until Gao Linwei returned from his inspection in Hangcheng before moving forward with investing in Jingdong.

Although he could buy a certain percentage of shares on the open market, doing so would first raise purchase costs, and second, Jingdong is backed by Beijing and Lucheng's local capital.

They might label him as a hostile acquirer and force him to give back the shares he'd acquired.

Now that he had Meng Yuanzhi's approval, he had nothing to fear.

Otherwise, even if Jingdong's behind-the-scenes investors ignored him, every 5% increase in equity required a disclosure—and retail investors on the secondary market weren't fools; they'd hold their shares tightly.

At that point, the price of 1. yuan per share could easily rise to 16 or even 26 yuan.

Chen Yansen had no intention of being a sucker!

At this moment, Gao Linwei had just boarded the flight back to Xucheng; his negotiations with Cheng Weixing had gone exceptionally smoothly, and he had successfully secured primary control of the new project.

(End of Chapter)