Venture capital firm Sequoia Capital China has co-anchored the 250 million yuan ($36.4 million) Series A funding round in LCSC, an online marketplace for electronic components in China, according to an announcement.
The latest funding round, which comes less than a year after the company raised 105 million yuan ($15.2 million) from Shenzhen Galaxy Supply Chain, also saw the backing of Eastern Bell Capital, a VC firm specialising in growth capital investments in logistics, e-commerce, supply chain, and consumer sectors, among others.
LCSC, also known as Lichuang Mall, operates as an online store of electronic components covering 200,000 products ranging from semiconductors to resistors, capacitors, diodes, inductors, connectors, transistors, and sensors.
Founded in 2011 in Shenzhen, China’s very own Silicon Valley, the company claims to have more than 900,000 customers and over 310 employees with $150 million in sales.
In a statement, LCSC said the fresh investments will be used to further help Lichuang Mall strengthen its core competitiveness in China’s bustling e-commerce sector. The company also seeks to create an AI trading system and data service platform based on the whole industry chain.
China’s total imports of integrated circuits exceeded $300 billion for the first time in 2018, according to LCSC. Integrated circuits have become the country’s largest import commodities for many years.
According to LCSC’s research data, there are about 33 domestic component distributors with a scale of 1 billion yuan and above – including nine listed companies – with a total revenue of 161.9 billion yuan.
Sequoia Capital China partner Fu Xin said LCSC has created a “one-stop procurement solution” to allow purchases of multi-type, small-batch, and multi-batch products.
“The firm has also satisfied chip manufacturers’ demand in attracting customers for new product introduction (NPI), trial production, as well as the promotion of products and technologies,” Fu said.
A Bloomberg report last year said China is trying to reduce reliance on some $200 billion of annual semiconductor imports and envisions spending about $150 billion over 10 years to achieve a leading position in design and manufacturing.
This leads to the launch of a $255-million fund to invest in semiconductor companies. The fund is participated by state-owned China Integrated Circuit Industry Investment Fund (China IC Fund).