Under Amazon's "store closure tide", another cross-border e-commerce has been refinanced.
Recently, Newme, a home furnishing brand, announced the completion of a multi-million dollar angel + round of financing, which was exclusively invested by Huaying Capital. This round of financing will be used for the research and development of its own brand and the expansion of incremental channels.
This is Newme's third fundraising in less than a year. The first two were a multi-million RMB seed round invested by Yunmu Capital and Zhishi Capital in January 2021, and a multi-million dollar angel round of financing led by Unique Capital and followed by Qingying Venture Capital in November 2021.
With the goal of becoming a "home version of SHEIN", does Newme have a chance to replicate the success of SHEIN?
Rooted in TikTok Live, GMV over a million dollars a year
Founded in November 2020, Newme is a DTC home furnishing brand that targets users with home demand in the European and American markets, and sells domestic "new, strange and special" home products to overseas markets by air transport.
Newme mainly relies on TikTok channels, through TikTok's short video advertising, combined with its own live broadcast team and third-party broadcasting, live streaming with goods, using TikTok small shops, independent stations to undertake traffic, to achieve conversion and product sales.
Co-founder Gu Jun introduced to The Investment Network that since the official sale in March 2021, Newme has accumulated more than one million US dollars in TikTok short video ads, with a peak of more than 1,000 daily advertising revenue orders, and several SKU products have sold more than 10,000 pieces. More than 500 live broadcasts were opened, and the conversion rate of 1-2% of the live broadcast was achieved, calculated according to the number of viewers of each live broadcast of 3000-6000, and the average number of live broadcasts converted 50 or 60 orders per live broadcast. Starting in the second half of 2021, the monthly GMV has doubled, peaking at nearly one million US dollars.
Newme also continues to exert efforts at the supply chain end, further defining new products through self-research, packages, etc., the main products cover lamps, kitchen small appliances, bathroom small appliances and power tools, etc., and the unit price of customers is maintained between 30-100 US dollars.
Founder Gu Jun is a serial entrepreneur in the e-commerce industry, who has worked for JD.com, Lebee.com, and Vipshop.
In 2015, Gu Jun founded an imported beauty social e-commerce company, using the social platform to grow Japanese and Korean beauty products, and then imported and sold the products to China. The company has completed three rounds of financing, respectively, gu Jun's former boss li jing in Lebee network, Jingwei China, Jianfeng Changqing, Bertelsmann investment, the cumulative financing of nearly 10 million US dollars.
With the rise of major social e-commerce such as Pinduoduo, Xiaohongshu, and Yunji Micro-store, the market share of small and medium-sized companies has been squeezed, and Gu Jun has begun to look for the next overseas opportunity.
Around 2018, Gu Jun set his sights on the overseas B2B e-commerce market. He had started a local social e-commerce business in India, similar to the Indian version of "Yunji Micro Store", but soon the company encountered the epidemic and the Sino-Indian trade conflict, and Gu Jun had to "turn the bow".
With the first two entrepreneurial experiences, Gu Jun quickly identified a new battlefield. In 2020, Gu Jun, who is in the United States, has insight into the opportunities in the US market - during the epidemic, offline retail in the United States is vacant but online retail is hot. As a result, Gu Jun quickly founded today's Newme.
Similar to Gu Jun, another co-founder, Tan Jianrong, is also a serial entrepreneur. Tan Jianrong has lived in France for 7 years, worked at Microsoft for 2 years, founded the 3C consumer electronics brand Emi, and received investment from Bertelsmann, Blue Lake Capital, Jinglin Capital and other institutions, with a total financing of hundreds of millions of yuan.
At present, Newme has a total of more than 20 employees, most of whom have overseas study and work backgrounds, good English language skills, and are familiar with overseas culture and living environment.
Strive to "products go to sea" to "brand out of the sea"
At present, most of Newme's products come from OEM or third-party procurement, and then more than 50% of the energy will be concentrated on the research and development and construction of its own brand, establish differentiated competitive barriers, and strive to achieve 30%-40% of the GMV ratio.
This shift stems from the experience of selling emoji luminous masks. During the epidemic, Newme showed a glowing emoji mask in the TikTok live broadcast room, selling 10,000 pieces in just 4 days. But this product is not original to Newme, 5 years ago Amazon had merchants to sell, when the product response was average. Newme's live broadcast brought the mask on fire, and also allowed those Amazon stores to "hitchhike", receiving 30,000 mask orders in a week.
This made Gu Jun realize that only by building his own brand and increasing product scarcity can he continuously improve the repurchase rate of consumers in Newme, break through the bottleneck of "product going to sea", and achieve "brand going to sea".
In Gu Jun's view, cross-border e-commerce will experience business evolution from OEM to white brand and then to private label. Newme plans to start from the front end of the supply chain, redefine products through accurate user portraits, and upgrade designs to create its own brand.
Gu Jun admits that one of Newme's learning goals is the cross-border e-commerce platform SHEIN. SHEIN has super content production capacity and super supply chain management ability, through the front-end traffic content high-frequency update and back-end supply chain small single fast reaction. As early as 2015-2018, SHEIN began to use technology to transform the supply chain, empower factory Kanban and production management systems, reduce inventory, and improve supply chain efficiency.
However, it is not easy to replicate the success of SHEIN. Byte's cross-border e-commerce independent site, Shein, Dynstudio, recently announced the closure of website operations. Some investors in the cross-border e-commerce track believe that dmonstudio has a big gap with SHEIN in terms of new user recognition, business maturity or supply chain management, which is more like Byte's testing of the cross-border e-commerce business. However, this will not stop bytes from looking for the next SHEIN, and cross-border e-commerce is also becoming a new battlefield for Internet manufacturers. As of January 2022, cross-border e-commerce financing has exceeded 100 million, including many head institutions such as Sequoia.
Especially not long after Amazon's "store closure tide", cross-border e-commerce independent stations quickly became popular, invariably choosing the light-funded live streaming mode of marketing on TikTok. Gu Jun also pointed out that with the hot overseas live streaming industry, the overseas offline retail industry has also opened online live broadcasting and other ways to take advantage of TikTok, and Newme will also confront large supermarkets such as Target and Costco.
Ji Wei, founding managing partner of Huaying Capital, said that in recent years, driven by the epidemic and other factors, overseas e-commerce has developed rapidly, and the traffic platform represented by TikTok as a typical representative has opened e-commerce, which will bring huge market space in the future. Newme is one of the first authorized sellers in China, which can realize closed-loop transactions in TikTok and has unique top allocation rights in its e-commerce system. The Newme team has been deeply involved in traffic e-commerce for many years, and the two founders have more than ten years of experience in Internet and retail entrepreneurship, have a deep understanding of the supply chain and brand, and have strong traffic operation capabilities. (Text/Zhang Junwen, Source/Zhongzhong Network)