China
Luckin Coffee Inc., the startup attempting to unseat Starbucks as the leading retail coffee chain in China, has filed for an initial public offering in the United States. The Bejing-based company seeks to raise $300 million in the IPO, according to a Bloomberg News report.
Luckin opened its doors in June 2017 and rapidly grew to 2,370 stores in 28 cities across China. But by the end of 2018, the company only held 2.1% of the market share. Starbucks, meanwhile, retains more than 50%, according to the report. Starbucks now has 3,700 stores in the country and wants to have 6,000 locations by 2023.
Luckin is targeting the fast-paced urban market that seeks convenience and affordability. Luckin coffee shops are cashless for fast pickup. It also offers delivery when customers use the Luckin phone app.
Luckin's burn rate is high, however. The company reportedly is spending $130 million a year and expects to see losses going forward. The company reported a net loss of $241 million in 2018 against $125 million in revenues.The company continues to seek new investors. In addition to the IPO, the company raised $150 million in April from a variety of investors.