Chinese coffee shop startup Luckin Coffee has raised $200 million and received a $1 billion valuation making it the country’s first coffee shop unicorn in the Starbucks-dominated market.
According to the Financial Times, Luckin has opened over 500 stores across China in just five months. It offers itself as a cheaper alternative to the market leader, selling a standard latte 30% of the price charged at Starbucks, which is considered an upmarket brand in China.
The growth in outlets puts Luckin ahead of British Costa Coffee, which has just 420 stores in China, although there is a long way to go before it catches up with Starbucks’ 3,300 cafes. Starbucks has also been expanding its dominance, with the global brand currently holding 80% of China’s $3.4 billion coffee chain industry from 60% in 2012.