Radicle recently opened Radicle China, based in Shenzhen and led by Jianqian (Lynn) Lin. Radicle China is focused on helping the world's leading companies better understand and engage with Chinese startup markets. Every week on Twitter, Lynn will be introducing you to a new Chinese startup market – here wireless charging – featuring a key player and the approach that has made it successful and discussing potential implications for western startups (here GoPuff, DoorDash and Instacart).

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If someone told you they had a phone charging service company and it has 200m users, was valued at $3bn, and recently IPO'd on the NASDAQ, you'd laugh at them. What if I also told you they also had a D2C alcohol brand? That just happened to a Chinese company. How did they do it? Read on…

On a typical workday, Mars Cai finished his work in Jing’an District, one of the CBDs in Shanghai, and was about to find a ride home on a ride-sharing app. The moment he opened the app, he saw a black screen -- his phone ran out of battery. A business idea started here.

Founded in 2017, Energy Monster is China’s largest mobile device charging service provider with annual revenues of $430m and 219m users. The company offers power bank services through offline location partners with heavy foot traffic such as shopping centers and restaurants.

Users can rent out the power banks by scanning the QR code on the cabinets. Pricing is on 30-min intervals and payments are powered by WeChat Pay and Alipay primarily. Users can carry the power banks with them and return to any location.

Pervasive smartphone usage, battery-consuming 5G adoption, and dependence on mobile apps such as short-form video apps and mobile games are fueling the demand. On average, Chinese mobile users spend over 6 hours online per day compared to 3 hours with their US counterparts.

Before the merger of two of its competitors, Jiedian and Sodian, which happened right before EM’s IPO, EM held the largest market share(34%) in the industry. @Meituan, a food delivery giant in China has rolled out similar charging services, adding more competitiveness in the space. 

EM’s revenue model largely depends on users’ payments. This could be fragile when consolidations and new players keep adding competitiveness in this space. EM is thinking differently. To diversify its revenue stream, EM opened its D2C Chinese Baijiu (a liquor) brand, Kaihuan (开欢).

EM also built a strategic partnership with Ele.me, one of the other biggest online food delivery service platforms in China. Users can rent out a charging device from Ele.me and order a pick-up service to avoid additional charges. Maybe one day, you can enjoy a Kaihuan branded cocktail from Ele.me?

I’ve only seen a very limited scale of similar services available in restaurants in NYC but I can hardly walk into a convenience store, restaurant, and other merchants in Shenzhen that doesn’t have a rental power bank cabinet. (A lot of the time there are more than one) 

Does the post-Covid adoption of QR scanning behavior in the West suggest greater potential for charging services? Looks like in China there's much more cross-pollination. Could a charging company partner with Doordash or Instacart or GoPuff in an Ele.me- or Meituan-like way? 

Follow me if you are interested in learning about Chinese companies that are not known as they should to the west. We also help companies and investors better understand how Chinese startups are shaping the future of their markets to make better and decisions @radicleinsights.

For more information and tweets about Radicle China - please follow @jianqianlin