Coffee startup Luckin is continuing its fundraising spree as it sets its sight on becoming an alternative to Starbucks in China.
The a-year-and-a-half old company announced on Thursday that it closed a Series B-plus raise totaling $150 million. The fresh proceeds valued Luckin at $2.9 billion post-money, up from $2.2 billion just four months ago.
While many question Luckin’s cash-fueled expansion, Blackrock, which owns a 6.58 percent stake in Starbucks, shows its confidence in the Chinese startup by pumping $125 million through its private equity fund into Luckin’s new round.
With that, the New York-based investment firm has its bet on two contrasting models for China’s coffee consumption. While Starbucks zeroes in on the brick-and-mortar experience, Luckin is a network of last-mile coffee delivery centers plus places for people to pick up orders and sit down targeting busy white-collar workers.
In a move that would amp up its battle with Luckin, Starbucks teamed up with Alibaba’s food delivery unit Ele.me last August to put hot and cold drinks in people’s hands.
Luckin did not disclose how it will spend the fresh capital infusion, but the pace at which it’s raising suggests the startup is in dire need of cash. The new