Cover Story: Charles Li’s Micro Connect Sells New Financing Model to China’s Small Businesses

Wang Jianlin, founder of hair care chain Mr. Judy, operates more 300 salons across China. In 2021, when his business was hit by the pandemic and unable to get bank loans, he received his first funding from Micro Connect, a small business lender founded by former Hong Kong Stock Exchange chief Charles Li.

Now, almost 100 Mr. Judy locations have received 20 million yuan ($2.74 million) of financing from Micro Connect. Each store signed an independent daily revenue contract, known as a DRC, with the platform. Wang pays a share of each store’s sales every day back to the platform. After the principal is repaid, the lender continues to receive 1% to 2% of store revenue, he said.