China: Tencent to invest $200m in 58.com’s used goods platform Zhuan Zhuan

Tencent company name is displayed at a news conference in Hong Kong, China March 17, 2016. REUTERS/Bobby Yip

Chinese tech giant Tencent has signed an agreement to invest $200 million in cash in Zhuan Zhuan, a used goods trading platform operated under 58.com Inc., China’s largest online market place.

Tencent will invest $200 million in cash and additional business resources into the new business group for a minority equity ownership, the company said in a statement.

Under the agreement, a new entity called Zhuan Zhuan Entities will be created, into which 58.com will inject the Zhuan Zhuan app, along with its used goods related listing channels 58.com and Ganji.com, which the Chinese listing major had acquired two years ago. 58.com will continue its direct traffic and other business support to the Zhuan Zhuan Entities.

In April 2015, 58.com announced that it had agreed to acquire a 43 per cent stake in competitor Ganji.com’s parent in a cash and stock deal, where it  paid $412.2 million in cash and about 34 million newly issued ordinary shares.

The transaction is currently expected to close in the second quarter of 2017.

Zhuan Zhuan is a mobile app enabling transaction of second hand goods. It allows sellers to upload pictures and a description of the used goods. After the item is sold and the buyer has received the item, the platform transfers the money to the seller to ensure transaction safety.

“Thanks to our platform, trading used goods is getting easier and can benefit everyone. Since our launch in November 2015, we have been picking up tremendous momentum by continuously focusing on improving the user experience and developing a robust online ecosystem. This transaction will immediately help to strengthen our support, and we are excited to explore how we can further enhance the overall service capabilities and technology of the business,” said Wei Huang, CEO of Zhuan Zhuan.

The online used goods market in China is gaining currency given that e-commerce conglomerate Alibaba Group’s online retail platform Taobao launched a platform for second hand products, Xian Yu. It is currently facilitating sales of about 200,000 used goods daily.

Recently another Chinese platform that allows the trading of used products, Liequ, raised RMB100 million ($14 million) series A investment led by HRX Asset, a fund management firm based in Shenzhen.

“Online transactions of used goods are very underdeveloped in China, but mobile technology and increasing user awareness are starting to create significant new opportunities. We are looking forward to accelerated growth in this market with more support from Tencent,” Michael Jinbo Yao, Chairman and CEO of 58.com.

Also Read:

HRX Asset leads $14m round in China’s used goods platform Liequ

SAIC leads $29m series C round in Chinese used car platform Che300

Singapore Reporter/s

In Singapore, we are looking to double our reporting team by this year-end to comprehensively cover the fast-moving world of funded startups and VC, PE & M&A deals. We want reporters who can tell our readers what is really happening in these sectors and why it matters to markets, companies and consumers. The ability to write precisely and urgently is crucial for these roles. Ideal candidates must have to ability to work in a collaborative, dynamic, and fast-changing environment. We want our new hires to be digitally savvy and ready to experiment with new forms of storytelling. Most importantly, we are looking for hard-hitting reporters who work well in a team. Collaboration and collegiality are a must.

Following vacancies can be applied for (only in Singapore).

Following vacancies can be applied for (only in Singapore).   

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  • A reporter who can get behind the scenes and reveal how funding rounds are put together, or why they’ve failed to materialise. She/he in this role will largely focus on long-format stories. 
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Singapore Reporter/s

In Singapore, we are looking to double our reporting team by this year-end to comprehensively cover the fast-moving world of funded startups and VC, PE & M&A deals. We want reporters who can tell our readers what is really happening in these sectors and why it matters to markets, companies and consumers. The ability to write precisely and urgently is crucial for these roles. Ideal candidates must have to ability to work in a collaborative, dynamic, and fast-changing environment. We want our new hires to be digitally savvy and ready to experiment with new forms of storytelling. Most importantly, we are looking for hard-hitting reporters who work well in a team. Collaboration and collegiality are a must.

Following vacancies can be applied for (only in Singapore).

Following vacancies can be applied for (only in Singapore).   

  • A reporter to track companies/startups that have raised private capital, and have the potential to become unicorns. SEA currently has over 40 companies with a valuation of over $100 million and under $1 billion.
  • A reporter who can get behind the scenes and reveal how funding rounds are put together, or why they’ve failed to materialise. She/he in this role will largely focus on long-format stories. 
  • A journalist to track special situations funds, distressed debt and private credit (from the PE angle) across Asia.