Alibaba Group to invest up to 750m $ in food service app

Nice Tuan, a Chinese grocery app, has received $ 750 million in investments from Alibaba Group Holding Ltd (NYSE: BABA), Anatole Investment, Jeneration Capital, D.E. Shaw and DST. Also known as Beijing Shi Hui Tuan LTD, Nice Tuan was founded in 2018 to enter the lucrative Chinese community food sector. The Chinese food delivery sector is huge and some of the biggest tech companies like Meituan, Tencent Holdings Ltd, and JD.Com Inc (Nasdaq: JD) are showing interest. The once-ailing industry has also seen a big boom since the outbreak of the Covid19 pandemic as more consumers are at home. This recent business growth has led startups like Nice Tuan to seek investment from larger companies to gain more market share. The industry is expected to grow to over $ 190 billion by 2025. The funds from the recently completed Series D investment round led by Alibaba and DST for Nice Tuan will be used to acquire more fresh produce and give the startup an edge over its competitors. Nice Tuan is currently available in over 1500 cities and ships more than 15 million products every day. With this new round of funding, coupled with 7 previous rounds that totaled over $ 550 million, Nice Tuan will most likely shake up the market. The Chinese food market is expected to grow at an annual rate of 5.5% through 2023. That means it will maintain its position as the leading food market in Asia and overtake the US as the largest food consumer in the world. With the ongoing pandemic and changing market trends, technology will continue to displace traditional grocery stores. Ali baba is therefore not the only tech company investing in this sector: Tongcheng Life, a group shopping app, is funded by Toshiba Corp and streaming service JOYY Inc (NASDAQ: YY). MissFresh, an online fresh produce platform, is also funded by Alibaba. Jin Tao, Equity Managing Director at Cynus, says he believes that with good management and strong funding, Nice Tuan will rise to become a market leader.