China’s ‘Uber for Trucks’ Secures $1.9 Billion Funding
Manbang Group, operator of a market-leading mobile app that matches truck drivers with shippers, closed a funding round of $1.9 billion from a group of investors led by China Reform Fund and Japan’s SoftBank Group Corp.
SoftBank’s Vision Fund invested $1 billion, Caixin learned from Manbang. Other investors include Google parent Alphabet Inc.’s venture capital fund CapitalG, Hong Kong-based investment firm Ward Ferry, Farallon Capital Management, Baillie Gifford, and a number of the company’s existing backers such as social media giant Tencent Holdings, Manbang said.
Investors valued the Uber-like truck-hailing company at $6 billion, according to Wang Gang, chief executive of Manbang. The valuation rose from $4.3 billion about a half-year ago, reflecting investors’ upbeat view of its leading position in the world’s busiest markets for goods transport.
Mobile-based truck-hailing services have boomed in China in recent years. They have helped to eliminate independent contractors and delays as drivers no longer need to waste hours in parking lots in search of the next dispatch. China’s trucking industry handles 5 trillion yuan ($757 billion) of business every year and carries 75% of the nation’s commercial cargo.
Around 5.2 million of China’s 7 million trunk line trucks are members of Manbang, according to the company. Its platform handles goods transport of 13.6 billion ton-kilometers every day, out of the average daily turnover of 18.3 billion ton-kilometers of road freight transport in China.
In an interview with Caixin, Wang said the company will use two-thirds of the new funds to recruit managers and professionals. The company also plans to expand its business reach from platform operation to driver services, logistics, property and financial services.
Wang said Manbang is planning to set up eight divisions covering the entire cargo transport business chain and connect truck transport with railway, shipping and aviation services. The company will also adopt new-energy vehicles and automatic driving technologies and will seek overseas expansion.
Manbang recently acquired truck operator Guangzhou Zhihong Logistics as part of the effort to build its own cargo transport capacity, Wang said.
While Manbang has no immediate plan to make an initial public offering, the company is likely to turn a profit this year, Wang said.
Manbang was formed by the merger in November of China’s two biggest truck-hailing companies — Yunmanman and Huochebang — after years of bitter rivalry.
Jiangsu province-based Yunmanman was established in 2013 and backed by Sequoia Capital and Yunfeng Capital, a private equity firm co-founded by Alibaba Group’s Jack Ma. Guizhou province-based Huochebang’s investors include All-Stars Investment Ltd., Baidu Capital and Tencent Holdings.
Contact reporter Han Wei (firstname.lastname@example.org)
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