JD Finance Announces $1B Fundraising From Sequoia, Harvest Investments

JD Finance, the Internet financial services arm of Beijing-based e-commerce firm JD.com Inc., is to raise RMB6.65 billion (US$1 billion) from investors including Sequoia Capital China, China Harvest Investments and China Taiping Insurance.

The company formally announced the fundraising after media reports emerged last month that JD Finance was in the process to raise its first venture round.

The financing values JD Finance at RMB46.65 billion (US$7 billion) on a fully-diluted, post-investment basis.

JD.com will still maintain majority ownership in JD Finance after the transaction is completed in the first half of 2016.

Two weeks ago, Ant Financial Services Group, the financial services arm of Alibaba Group Holding, was reportedly seeking at least RMB10 billion (US$1.5 billion) in a second round of financing ahead of a planned initial public offering as early as this year.

JD Finance’s key businesses are consumer credit, supply chain finance, online and mobile payment, crowdfunding and wealth management.

In 2015, JD Finance completed transactions totaling over RMB150 billion, of which RMB100 billion were online and mobile payment transactions.

Wealth management transactions reached RMB25.7 billion, and supply chain finance amounted to RMB11.5 billion, according to an internal document obtained by Chinese media.

For the first three quarters of 2015, it recorded combined revenues of RMB1.26 billion, with a net loss of RMB677 million.

In June 2015, JD Finance teamed up with U.S. financial technology firm ZestFinance to establish a joint venture to enter the consumer credit in China.

JD’s equity crowdfunding platform was launched in April 2015.

China Expert network