Michael Norris discusses Luckin Coffee’s IPO and how much of the business actually makes sense.
More and more fast-growing startups are headed to IPO while hemorrhaging money.
The news also immediately comes after a delivery partnership between Luckin and Meituan was announced in December 2018.
The IPO filing comes a week after the company’s $150 million Series B+ that is raised at a valuation of $2.9 billion.
Shares slid overnight after losses hit nearly $100 million in the quarter.
A web of CAR Inc and UCAR personnel, resources and investors are behind Luckin’s expansion.
Luckin is under financial pressures as the startup coffee chain is showing signs of overheating.
Coffee competition expands to second-and third-tier cities in China.
Its rapid, capital-fueled growth and widening losses leave the question of sustainability open for debate.
This is the first time Luckin has sold branded merchandise as it evolves its marketing and branding strategy.