Alibaba just gave Chinese youth another reason to never leave their desk

People in China have a host of reasons not to go outdoors these days. They may be too busy to leave their office, wary of air pollution or have chosen to live isolated lives. Among them is an expanding young consumer base who prefers to dwell in the virtual world of video games, animes and comics over the tangible reality. More important, there’s an endless list of startups pandering to their impulse to stay indoors with services from online shopping to food delivery.

Two Chinese internet giants are chasing after this indoorsy crowd. Last week, food delivery giant Ele.me announced that it’s teamed up with youth entertainment site Bilibili on a one-off joint membership that will further keep young consumers at their desk.

Ele.me, which means “are you hungry?” in Chinese, was sold to ecommerce behemoth Alibaba in April. Bilibili, which went public in the U.S. this year, started as a video streaming service focused on animes and has evolved into a one-stop destination for all things related to youth cultures: Animes, comics, cosplay, video games and other niches that you and I may fail to name.

Their marriage gives subscribers the best of both worlds: Unlimited streaming of animes and deep discounts on food delivery orders. Bilibili has been doubling down on content investments in recent months, which saw it agree to buy out most of the comics assets of Netease, one of China’s largest internet companies. What’s better than binging on one’s favorite anime series and not having to leave home when the stomach growls? (Whether this is a healthy lifestyle is another topic.)

The promotion, which runs from December 23 to December 30, allows people to purchase the memberships of Bilibili and Ele.me at 25 yuan, or $3.63, a month. That’s a 15 yuan discount from what users would have to pay were they to subscribe to the two services separately. The rationality behind the tie-up is an overlapping Generation Z user base. By 2017, about 82 percent of Bilibili’s users are 8 to 28 years old, according to a report by QuestMobile. Meanwhile, more than 60 percent of the users who order food online in China are under 24 years old.

China’s food delivery market is set to top 243 billion yuan, or $35 billion, by the end of 2018, according to iiMedia. By then, China will have 355 million users of food delivery apps — or about 40 percent of its national population. Five years ago, there were just over 100 million users for this market.

The boom has jacked up the price tags of market leaders Ele.me, which was valued at $9.5 billion in the Alibaba deal, and Tencent-backed Meituan Dianping, which had a spectacular initial public offering in Hong Kong in September.

Alibaba and Bilibili call their joint membership “Zhai E Kuai,” a wordplay on “be otaku together.” The Japanese word “otaku” originally means “someone else’s venerable home” and later took on a new life to describe someone who is so obsessed with a subject or hobby to the point of not leaving home. Bilibili’s core users are often stereotypically described as otakus of animes or video games, though certainly not all of them shun the outside world.

Aside from Bilibili, Alibaba has also been pally with Starbucks as the two began integrating their rewards systems.

Memberships similar to Amazon Prime have become an increasingly popular tactic for China’s tech giants to drive revenue growth. Alibaba, for instance, has lumped services of its portfolio companies under 88 Membership that spans ecommerce (Tmall), fresh produce (Tmall), food delivery (Ele.me), video streaming (Youku), music streaming (Xiami), movie tickets (Taopiaopiao) among others. Tencent has taken a different approach to membership with its King Card mobile internet plan, a partnership with China’s major telco that gives users unlimited data usage on apps in Tencent’s ecosystem — from social networks, video streaming to games.

Tencent-backed homework app jumps to $3B valuation after raising $300M

Academic exams are a big deal in China as they determine the kind of universities, high schools and elementary schools that students get into and to a degree, the future that awaits them.

Parents are thus willing to invest generously to help their children get ahead in school. One startup capitalizing on this need is Yuanfudao, a six-year-old startup that has attracted a line of big-name investors. The company announced this week that it has raised $300 million in a funding round led by existing investor Tencent, China’s largest social networking and gaming company.

Other participants from the round include Warburg Pincus, Matrix Partners China and IDG Capital . The fresh injection raised Yuanfudao’s valuation from around $1 billion at the time it pocketed $120 million in 2017 to exceed $3 billion.

China’s exam-oriented culture has given rise to a billion-dollar tutoring market. As affordable mobile internet becomes common, a lot of that teaching effort is happening online. A report by research firm iResearch shows that China’s online K-12 market will reach 44 billion yuan, or $6 billion, by the end of this year and will more than triple to 150 billion yuan by 2022.

Yuanfudao, which means “ape tutor” in Chinese, administers a suite of services including live courses, a database of exam problems and a popular homework help app. The latter scans homework problems and solves them instantly with the snap of a camera. The startup also operates a research institute for artificial intelligence, which could train its homework app to be smarter.

Yuanfudao claims to serve more than 200 million users, which include students and their parents who use the startup’s apps to check the learning progress of their kids.

Yuanfudao told TechCrunch that it derives the majority of its revenues from selling live courses. It plans to use the proceeds from the latest round to fund investments in research and development of AI as well as improve its apps’ user experience.

The startup is in a heated race to fight for Chinese students and parents. Other companies with similar homework help services include Zuoyebang, which is backed by Chinese search giant Baidu, Coatue Management, Sequoia Capital China and Goldman Sachs. Another one is Yiqizuoye, which counts Singapore sovereign fund Temasek as an investor. A wave of Chinese companies that started with a focus on adult education have also come into the K-12 fray, including New Oriental and 51Talk, which are both listed on the New York Stock Exchange.

China’s WeChat is the latest to get Snap-like ‘Stories’

WeChat, the Chinese messaging giant with more than 1 billion monthly active users around the world, just added a Snap-like ephemeral video feature as part of its biggest overhaul since 2014.

The revamp comes as Tencent, which owns stakes in Snap, sees increasing rivalry from up-and-comers like video app TikTok and news app Jinri Toutiao. WeChat has, over the years, morphed beyond a straight-up messenger to include many utility purposes. With more than 1 million lightweight apps up and running, users can accomplish a long list of tasks, ranging from shopping to ride-hailing, without ever having to leave WeChat.

Meanwhile, some have expressed frustration over WeChat’s core as a social app. Moments, a feature akin to Facebook News Feed, was once a haven for close friends to share articles, photos and videos. But newsfeed content became blander over time as people’s contact list grew to include their bosses and their local fruit seller who needs to be added as a friend to process WeChat payments.

WeChat founder Allen Zhang is known for his obsession with user experience and has been cautious with tweaks, so a major redesign to the super app is effectively a guidebook for where WeChat is headed for the next few years.

The new off-the-cuff video feature, aptly named “Time Capsule,” is one of WeChat’s more noticeable updates. In the past, users shared videos to three main destinations: A friend, a group chat or Moments. This route remains unchanged, but with Time Capsule, users also can upload videos of up to 15 seconds that disappear after 24 hours, similar to how Snap Stories and its slew of clones, including Instagram Stories, work. Meanwhile, Snap also has drawn inspiration from Chinese apps in a recent redesign.

A blue ring will appear near the profile of those who have recorded an instant story. Screenshot by TechCrunch

Different from Instagram, which recently started allowing users to share Stories to close friends, WeChat doesn’t let users share Time Capsule videos to friends yet. Instead of lining up all the instant videos at the top of the app as Instagram does, WeChat is asking users to find them in less conspicuous ways: On Moments, in a group chat or in one’s starred friend list, a blue ring will appear near the profile of those who have recorded instant stories.

These secret entry points mean users are prompted to watch videos of those they know well, as they rarely click on the profile of, say, a fruit vendor.

Time Capsule is also a step up from WeChat’s old video sharing tool, with additional features such as locations and music, functions that are ubiquitous in TikTok and other short-form video apps. Users also can react to Time Capsule videos by blowing virtual “bubbles,” whereas the old video format doesn’t allow such interaction.

Time Capsule is a step up from WeChat’s old video sharing tool, with additional features such as locations and music. Screenshot by TechCrunch

While Time Capsule is not necessarily a direct challenger to TikTok — a product of the world’s most valuable startup ByteDance — it enriches the video experience for users who want to give close friends a window into their life. TikTok, by comparison, delivers content by relying on artificial intelligence to read users’ past habits rather than studying their social graphs.

That said, WeChat has shown signs to catch up with TikTok by rolling out a dozen video apps this year. While Tencent blocks TikTok videos from being shared to WeChat, its own proprietary video app Weishi gets preferential treatment. When users choose to record a video on WeChat, there’s an option to record it via Weishi. But Tencent’s short video fleet has a long way to go before they reach TikTok’s global dominance of 500 million monthly active users.

Another WeChat update also appears as a response to a popular ByteDance app. While WeChat users could show appreciation for an article by clicking on a “like” button, there was no effective way in the past to know what their friends enjoyed. The revamped WeChat now lets people see all the articles their friends have liked under one single stream called “Wow.”

That’s a feature that ByteDance’s Jinri Toutiao news app cannot rival, as Wow is built on billions of users who know each other, unlike Jinri Toutiao, which relies on AI personalization like its sibling TikTok. WeChat is already colossal and can never please every user, but its new move shows that it’s paying close attention to whoever that may steal its users’ eyeball time away.

TikTok parent ByteDance sues Chinese news site that exposed fake news problem

There’s worrying news from China’s online media world as ByteDance, the $75 billion company behind popular video app TikTok is taking a news site to court for alleged defamation after it published a story about ByteDance’s fake news problem in India.

U.S. tech firms have come to rely on media to help uncover issues, but Chinese tech news site Huxiu has become the latest litigation target of ByteDance, which reportedly surpassed Uber’s valuation after raising $3 billion. The company has sued internet giants Tencent and Baidu in the past year for alleged anti-competitive behavior.

This time around, ByteDance — which is backed by SoftBank’s Vision Fund, KKR and General Atlantic among others — has taken issue with an op-ed published earlier this month that spotlights a fake news problem on its Indian language news app, Helo.

Launched in July as part of ByteDance’s push in India, Helo competes with local media startups such as Xiaomi-backed ShareChat and DailyHunt as well as Facebook. ByteDance operates news app Jinri Toutiao with over 250 million monthly active users in China, according to data services provider QuestMobile. TikTok, branded as Douyin in China, has a reach well beyond its home front and claims 500 million MAUs worldwide with an additional 100 million users gleaned from its Musical.ly buyout.

“An insult and abuse”

On December 4, Huxiu published an opinion piece that condemned Helo and ShareChat for allowing misinformation to spread. One Helo post, for instance, falsely claimed that a Congress leader had suggested that India should help neighboring rival Pakistan clear its debt rather than invest in the State of Unity, a pricey local infrastructure project.

In response, ByteDane filed a lawsuit against Huxiu, saying that the Chinese news site made defamatory statements against it in translating an op-ed by contributor Elliott Zaagman. Tech blog TechNode — TechCrunch’s partner in China — ran an edited English version of the story but it is not part of the suit.

Zhang Yiming, founder of ByteDance, poses for a photograph at the company’s headquarters in Beijing, China. Photographer: Giulia Marchi/Bloomberg via Getty Images

“Technode edited the piece and removed some of my words. Huxiu was, and is with most of my articles, true to my original words,” Zaagman wrote on his WeChat timeline.

To adhere only to “facts” as part of its editorial process, TechNode removed “colorful” parts of Zaagman’s article, according to the blog’s editor-in-chief.

What goes missing on TechNode is what incensed ByteDance. Zaagman’s unfiltered statements on Huxiu “constitute an insult and abuse against ByteDance” by “claiming that Chinese companies have influence over the Indian election,” a ByteDance spokesperson told TechCrunch.

“The content on Huxiu is obviously a rumor and libel. It’s malicious slander. Whether it’s Chinese or foreign publications, Chinese or foreign authors, they must respect the truth, laws, and principles of journalism,” the spokesperson added.

The unedited English version is posted on Zaagman’s personal LinkedIn account here. Here is one paragraph that TechNode removed:

Maybe still Zhang is simply a victim of his own success. Few entrepreneurs start a company expecting it to be worth $75 billion. But what he has created may have far broader ramifications. As is demonstrated by Russia’s use of American social networking platforms to interfere in Western elections, misinformation campaigns can be a tool used by adversaries to disrupt a country’s internal politics. At this current moment when China faces greater international tensions, a pushback to their rising influence in Asia, and territorial disputes along their border with India, the last thing that Beijing needs is accusations from an opportunistic Indian politician sounding the alarm about how Beijing-based Chinese companies are spreading misinformation among the impressionable Indian electorate….

And this as well:

Although, on second thought, maybe it makes perfect sense that Zhang Yiming is peddling products that he himself would likely never use. After all, any good drug dealer knows not to get high on their own supply.

In a statement, Huxiu dismissed ByteDance’s accusation for being “wildly untrue” and bringing “major repercussions” for the online publication’s reputation. A spokesperson for Huxiu told TechCrunch that it hasn’t received any summons as the court is still processing the complaint.

In a peculiar twist to the incident, Huxiu actually pulled its Chinese version of Zaagman’s piece days leading to the ByteDance suit. The removal came as a result of “negotiations among multiple parties,” said the Huxiu representative who declined to share more details on the decision. In China, an online article can be subject to censorship for containing material considered illegal or inappropriate by the media platform itself or the government.

The problem of AI

douyin tiktok musically

The logo for ByteDance’s popular video app TikTok (called Douyin in China) at an electronic dance music festival. / Credit: ByteDance

In the U.S., Facebook has responded proactively to issues raised by the media — for example by banning accounts that stoke racial tension in Myanmar — while Twitter CEO Jack Dorsey went so far as to suggest that journalists sniffing out issues on his service is “critical” to the company. Beijing-based ByteDance hasn’t commented on the fake news problem highlighted in Zaagman’s article, but staff from its Indian regional app previously acknowledged the presence of misinformation.

“We work very closely with our local content review and moderation team in harnessing our algorithms to review and take down inappropriate content,” a Helo spokesperson told local newspaper Hindustan Times.

The concerns about Helo are the latest blow for ByteDance, which has marketed itself as an artificial intelligence company delivering what users want to see based on what their online interaction in the past. As has been the case with Western platforms, such as Google-owned YouTube which also uses an algorithm to feed users videos that they favor, the outcome can mean sensational and sometimes illegal content.

Along those lines, ByteDance’s focus on AI at the expense of significant “human-led” editorial oversight has come in for criticism.

In July, the Indonesian government banned TikTok because it contained “pornography, inappropriate content and blasphemy.” At home, Chinese media watchdogs have similarly slammed a number of the company’s other content platforms, and regulators in the country went so far as to shutter its humor app for serving “vulgar” content.

But ByteDance is hardly the only tech company entangled in China’s increased media scrutiny. Heavyweights including Tencent, Baidu, and ByteDance’s archrival Kuaishou have also come under attack at various degrees for hosting content deemed problematic by the authorities over the past year.

BMW’s premium ride-hailing service is now live in China

BMW has joined a handful of automakers to compete with transportation upstart Didi Chuxing, which bought Uber’s Chinese business in 2016. Last Friday, the German luxury carmaker launched a premium ride-hailing service in Chengdu, the capital of China’s Sichuan Province with over 14 million people.

The new offer is part of BMW’s ReachNow carsharing brand that kicked off an electric vehicle rental business with a local partner last December. The new ride-hailing venture manages a crew of trained drivers to chauffer riders in a fleet of 200 BMW 5 Series, out of which half are plug-in-hybrid, according to the company.

“We are excited to offer our new premium ride-hailing service in Chengdu, one of the largest ride-hailing hubs in the world embracing mobility solutions for a sustainable urban future,” said Peter Schwarzenbauer, member of BMW AG’s board of management, in a statement.

ReachNow trips appear to be pricier than those on Didi’s “luxury” feature — which is currently only available in China’s top-tier cities of Beijing, Shanghai, Shenzhen, and Guangzhou — that also deploys BMW Series 5 and the likes of Mercedes-Benz E-Class and Audi A6. A 23-kilometer ride in Chengdu, for instance, costs 468 yuan or $68 at 3 p.m. on Monday. That’s about $3 per kilometer.

bmw ride hailing china

By comparison, a trip of similar distance in Shenzhen via Didi Luxury costs 210 yuan, or $30, at a rate of $1.3 per kilometer on a Monday afternoon.

didi compared to bmw

BMW’s new move comes shortly after it became the first global carmaker to nab China’s ride-hailing operating license in late November and at a time when the country’s biggest player Didi faces public and government backlashes following two passenger murders.

Following the Didi incidents, Chinese authorities have applied deeper controls over the verification process in both drivers and their vehicles to step up safety for riders, leading to a shortage in both drivers and vehicles for Didi and its ride-hailing peers.

China’s transportation rules stipulate that drivers must hold two certificates — one for themselves and one for their vehicles — to be eligible to take passenger requests on ride-hailing apps. That turned a lot of part-time drivers away as they either don’t want to invest the time and money preparing for exams or scrap their passenger cars after eight years.

To cope with regulatory changes, Didi has introduced training programs to help drivers obtain the desired licenses. The mobility giant has also partnered with carmakers to make “purpose-built” vehicles for on-demand rides, although that process had started before the passenger deaths.

Like BMW, China’s oldfashioned carmakers also have their sights set on the car-hailing market. Among them are Volkswagen’s local partner SAIC Motor and Geely, which is partnering with Daimler to roll out a new ride-hailing venture.

Update: The headline has been corrected.

China’s BYD further drives into Chile with 100 electric buses

Over the past few years, Chinese automaker giant BYD has been on a partnership spree with cities across China to electrify their public transportation systems, and now it’s extending its footprint across the globe. On Thursday, BYD announced that it has shipped 100 electric buses to Santiago, the capital city of Chile.

The step marks the Chinese firm’s further inroads into the Latin American country where a green car revolution is underway to battle smog. BYD’s first batch of vehicles arrived in Santiago last November and the Warren Buffett-backed carmaker remains as the only electric public bus provider in the country.

Chile is on the map of China’s grand Belt and Road Initiative aiming to turbocharge the world’s less developed regions with infrastructure development and investments. “With the help of ‘One Belt One Road,’ BYD has successfully entered Chile, Colombia, Ecuador, Brazil, Uraguay and other Latin American countries. As the region accelerates its electric revolution, BYD may be able to win more opportunities,” said BYD in a statement.

byd chile 1

President of Chile Mr. Sebastián Piñera rides the BYD electric bus. / Credit: BYD

The 100 buses embarked on a 45-day sea voyage from BYD’s factory in eastern China to land on the roads of Santiago. They sport the Chilean national colors of red and white on the exterior and provide USB charging ports inside to serve a generation who live on their electronic devices.

The fleet arrived through a partnership between BYD and Enel, a European utility juggernaut that claims to make up 40 percent of Chile’s energy sales in 2017. Enel has purchased the fleet from BYD and leased them to local transportation operator Metbus while the Chilean government set the rules and standards for the buses, a BYD spokesperson told TechCrunch.

Local passengers graded BYD’s electric vehicles at 6.3 out of 7, well above the 4.6 average of the Santiago public transportation system, according to a survey jointly produced by Chile’s Ministry of Energy as well as Ministry of Transport and Telecommunications. Respondents cited qualities such as low noise level, air conditioning and USB charging that the buses deliver.

Santiago currently has 7,000 public buses running on the road, among which 400 get replaced every year. A lot of the new ones will be diesel-free as the Chilean government said it aims to increase the total number of electric vehicles by tenfold in 2022.

What China searched for in 2018: World Cup, trade war, Apple

Soon after Google unveiled the top trends in what people searched for in 2018, Baidu published what captivated the Chinese in a parallel online universe, where most of the West’s mainstream tech services including Google and Facebook are inaccessible.

China’s top search engine put together the report “based on trillions of trending queries” to present a “social collective memory” of internet users, said Baidu. 802 million people have come online in China as of August, and many of them use Baidu to look things up daily.

Overall, Chinese internet users were transfixed on a mix of sports events, natural disasters, politics, and entertainment, a pattern that also prevails in Google year-in-search. On Baidu, the most popular queries of the year are:

  1. World Cup: China shares its top search with the rest of the world. Despite China’s lackluster performance in the tournament, World Cup managed to capture a massive Chinese fan base who supported an array of foreign teams. People filled bars in big cities at night to watch the heart-thumping matches and many even trekked north to Russia to show their support.
  2. US-China trade war: The runner-up comes as a no surprise given the escalating conflict between the world’s two largest economies. A series of events have stoked more fears of the standoff, including the arrest of Huawei’s financial chief.

  3. Typhoon Mangkhut: The massive tropical cyclone swept across the Pacific Ocean in September, leaving the Philippines and South China in shambles. Shenzhen, the Chinese city dubbed the Silicon Valley for hardware, reportedly submitted more than $20.4 million in damage claims after the storm.

  4. Apple launch: The American smartphone giant is still getting a lot of attention in China even as local Android competitors like Huawei and Oppo chip away at its market share. Apple is also fighting a legal battle with chipmaker Qualcomm which wanted the former to stop selling certain smartphone models in China.

  5. The story of Yanxi Palace: The historical drama of backstabbing concubines drew record-breaking views for its streamer and producer iQiyi, China’s answer to Netflix that floated in the U.S. in February. The 70-episode show was watched not only in China but also across more than 70 countries around the world.

  6. Produce 101: The talent show in which 101 young women race to be the best performer is one of Tencent Video’s biggest hits of the year, but its reach has gone beyond its targeted young audience as it popularized a meme, which made it to No. 9 on this list.

  7. Skr: A buzzword courtesy to pop idol Kris Wu who extensively used it on a whim during iQiyi’s rap competition “Rap of China,” prompting his fans and internet users to bestow it with a myriad of interpretations.

  8. Li Yong passed away: The sudden death of the much-loved television host after he fought a 17-month battle with cancer stirred an outpouring of grief on social media.

  9. Koi: A colored variety of carps, the fish is associated with good luck in Chinese culture. Yang Chaoyue, a Produce 101 contestant who the audience believed to be below average surprisingly rose to fame and has since been compared to a koi.

  10. Esports: Professional gaming has emerged from the underground to become a source of national pride recently after a Chinese team championed the League of Legend finals, an event regarded as the Olympics for esports.

In addition to the overall ranking, Baidu also listed popular terms by category, with staple areas like domestic affairs alongside those with a local flavor such as events that inspire national pride or are tear-jerking.

This was also the first year that Baidu has added a category dedicated to AI-related keywords. The search giant, which itself has pivoted to go all in AI and has invested heavily in autonomous driving, said the technology “has not only become a nationwide buzzword but also a key engine in transforming lives across the globe.” In 2018, Chinese people were keen to learn about these AI terms:

Robots, chips, internet of things, smart speakers, autonomous driving, face recognition, quantum computing, unmanned vehicles, World Artificial Intelligence Conference, and quantum mechanics.

China’s second-largest gaming company to sell comics assets to rival

China’s online youth entertainment platform Bilibili said it has agreed to buy major assets from the comics arm of gaming giant NetEase, which helped introduce Marvel’s first batch of Chinese superheroes in May.

The deal announced on Wednesday will see Bilibili acquire the copyrights of a large number of popular storylines from NetEase to beef up its content offering for a community of anime, comics and gaming users — or collectively known as ACG fans.

Nine-year-old Bilibili raised $483 million from a U.S. initial public offering in March.

“The addition of [NetEase Comics’] extensive library of well-known content deeply enriches our online comic offerings. It not only complements our core users’ growing appetite for premium licensed ACG content, but also solidifies our leading position in China’s ACG industry,” said Carly Lee, chief operating officer of Bilibili, in a statement.

Update: A NetEase spokesperson provided the following comment:

“We are positive about the deal between Bilibili and NetEase Comics. NetEase will continue its exploration in the ACG industry and operation of Marvel and other works from our licensing partners. In the future, we will further launch deep partnerships with Bilibili in the ACG field,” a NetEase spokesperson told TechCrunch.

The move comes as China’s game publishers struggle with a title approval freeze starting March that has hammered the stock prices of the market’s leader Tencent and second fiddle NetEase.

Like Tencent and NetEase, Bilibili generates a bulk of its income from games, which accounted for 69 percent of its total revenues during the third quarter.

Until recently, Bilibili’s services to its mainly young user base centered around videos, live streaming, and mobile games. In November, the company launched a comics-specific mobile app that would demand heavy content investment to net new users. A lineup of rivals await Bilibili as it plugs itself into the online comics market. Leading the race is Kuaikan Manhua with smaller players including Tencent Comics and NetEase Comics trailing behind, according to an app ranking by market research firm Analysys.

Tencent’s comics app topped 120 million monthly active users last December, said Zou Zhengyu, general manager of Tencent Comics and Animation, at a company event.

Bilibili has also leaned on partnerships to grow its reservoir of gaming titles. In October, it struck a deal that would allow it to run more Tencent games on its own platform. The tie-up followed a $318 million investment from Tencent in Bilibili that lifted Tencent’s ownership to around 12 percent of Bilibili’s total issued shares.

Starbucks challenger Luckin snags $200M investment on $2.2B valuation

Luckin, a startup that vows to topple Starbucks’ dominance in China, announced on Wednesday that it’s lifted its valuation to $2.2 billion after raising $200 million in a series B funding round.

That came only five months after the coffee upstart, which soft-launched in January, picked up $200 million in investment. Luckin has been on a spending spree to open shop and burnt through $150 million within the first six months in operation, its founder said in July when the company had a cash reserve of 2 billion yuan, or roughly $290 million.

Luckin currently operates across 21 major Chinese cities, totaling more than 1,700 shops. For comparison, Starbucks’s footprint spanned 3,300 stores in China as of May, though one has to take into account that the Seattle coffee chain entered China nearly 20 years ago.

Different from Starbucks, Luckin’s brick-and-mortar facilities are a mix of sit-down cafes and pickup booths, which double as delivery hubs, and take-out kitchens that are solely for delivery staff to pick up caffeine-infused orders and put them in customers’ hands within 30 minutes.

As a result, Luckin managed to build a dense network targeting office workers who may be drawn to the idea of coffee delivery because they can’t leave their desk. There’s at least one Luckin location within a 500-meter radius anywhere in downtown Shanghai and Beijing, the company claimed.

The light speed at which Luckin has expanded in less than a year probably got on the nerves of Starbucks, which went on to team up with Alibaba-owned food delivery giant Ele.me in August to bring coffee to people’s doorstep. The American company aims to expand its delivery services to 30 cities in China by the end of 2018.

Luckin’s co-founder and chief executive officer Qian Zhiya, who is the former chief operating officer at one of China’s largest auto rental firms CAR Inc, said her startup will continue to invest in products, technology and business development to improve user experience following the new round.

Luckin raised the fresh capital from existing investors Singapore sovereign wealth fund GIC, Chinese government-controlled China International Capital Corporation, Joy Capital and Dazheng Capital. Liu Erhai, founding and managing partner of Joy Capital, joined Luckin’s board of directors following the close of the round. Liu’s investment portfolio includes Car Inc, Facebook’s old Chinese rival Renren and Hong Kong-listed game publisher iDreamsky.

Apple says iPhones remain on sale in China following court injunction

Apple has filed an appeal to overturn a court decision that could ban iPhone sales in China, the company said on Monday, adding that all of its models remain available in its third-largest market.

The American giant is locked in a legal battle in the world’s biggest smartphone market. On Monday, Qualcomm announced that a court in Fujian Province has granted a preliminary injunction banning the import and sales of old iPhone models in China because they violated two patents owned by the American chipmaker.

The patents in question relate to features enabling consumers to edit photos and manage apps on smartphone touchscreens, according to Qualcomm.

“Apple continues to benefit from our intellectual property while refusing to compensate us. These Court orders are further confirmation of the strength of Qualcomm’s vast patent portfolio,” said Don Rosenberg, executive vice president and general counsel of Qualcomm, in a statement.

Apple fought back in a statement calling Qualcomm’s effort to ban its products “another desperate move by a company whose illegal practices are under investigation by regulators around the world.” It also claimed that Qualcomm is asserting three patents they had never raised before, including one which has already been invalidated.

It is unclear at this point what final effects the court injunction will have on Apple’s sales in China.

The case is part of an ongoing global patent dispute between Qualcomm and Apple, which saw the former seek to block the manufacturing and sale of iPhones in China over patent issues pertaining to payments last year.

Qualcomm shares were up 3 percent on Monday. Apple opened down more than 2 percent before closing up 0.7 percent. Citi lowered its Apple price target to $200 a share from $240 a share, saying in a note to investors that while it does not expect China to ban or impose additional tariffs on Apple, “should this occur Apple has material exposure to China.”

The Apple case comes as the tech giant faces intensifying competition in China, which represented 18 percent of its total sales from the third quarter. The American company’s market share in China shrunk from 7.2 percent to 6.7 percent year-over-year in the second quarter as local competitors Huawei and Oppo gained more ground, according to market research firm IDC.

The annual drop is due to Apple’s high prices, IDC suggests, but its name “is still very strong in China” and “the company will fare well should it release slightly cheaper options later in the year.”