Nanjing-headquartered Zhongneng United, which is a one-stop solution for renting heavy trucks used in construction, announced Tuesday that it has closed its Series B funding round at USD 50 million. The round was led by China’s Source Code Capital and other VCs, another sign traditional heavy industry players are becoming venture capital’s new darlings.
This is the third major fundraising for Zhongneng in less than one year as it closed its Pre-Series A round in July 2018 and its RMB 625 million (USD 93 million) Series A round in September.
After transforming China’s consumer-facing industries, including retail, health, education, and finance, the internet is expected to restructure traditional heavy industries such as manufacturing and construction.
Mckinsey Global Institute predicted that the industrial “internet of things” adds up to a USD 33 trillion-opportunity. Linking up machines, computers, and humans will reduce maintenance costs, save energy, reduce waste and improve workforce productivity, according to these estimates.
Zhongneng United taps into this trend, claiming that it has built up a data-driven management system for its enterprise clients and its fleet of nearly 10,000 trucks and warehouses.
The company lets its clients book a rental order on its website and has an offline marketing, logistics, and maintenance presence in 33 cities across 22 provinces in China.
Zhongneng’s founder decided to enter the overhead equipment rental sector in June 2015. Since then, the company has served more than 10,000 clients, according to its website. Its clients include those participate in building Beijing’s second international airport and the Zhuhai- Hong Kong-Macao Bridge.
Source Code Capital’s Wang Xingshi said that Zhongneng United ‘s data-driven operation has allowed it to make each decision more scientific and more efficient, consolidating its leading position in the industry with outperforming life-span management capabilities and securitization-level of its equipment.
Another investor Buhuo Venture’s Yi Jiayu said that the company has shown high management capabilities during expansion and that he hopes the company can turn to be a technology-driven platform which can empower companies upstream and downstream to improve the operational efficiency of the whole industry.
The company role model is United Rentals, which is headquartered in the United States and listed on the New York Stock Exchange, said Zhongneng United CEO Yang Tianli.
United Rentals, which offers rental services for lifts, air compressors, generators, track loaders and excavators, had a market capitalization of USD 9.3 billion at the time of close on Monday.
Editor: Nadine Freischlad
Contact the writer at jingli@kr-asia.com
