Tencent-backed Dianping funds startup to fuel Chinese takeaway tussle

Dianping, China’s top Yelp-like site, this week led a series C funding round into food delivery startup Meican. The investment is worth RMB 140 million (US$22.6 million), with KPCB and Nokia Growth Partners (NGP) also participating. It was reported by Tencent’s QQ Tech site.

The move comes as China’s online food delivery sector finally heats up after a lukewarm start.

The involvement of Dianping – in which tech titan Tencent owns a 20 percent stake – shows that both Dianping and Tencent are looking to dominate this sector by taking strategic stakes in the leading takeaway services. In May 2014, Dianping put US$80 million into Ele.me – perhaps China’s top food delivery site – and then at the start of this year Tencent and Dianping joined in with a few other investors to put a further US$350 million into Ele.me. Tencent has also backed the fast-growing Line0 app.

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Dianping, which started out doing just restaurant listings, graduated to offering its own food takeaway options at the start of 2014 in partnership with restaurants in several Chinese cities.

Between Meican, Ele.me, Line0, and Dianping itself, Tencent has this growing sector on lockdown.

Meican is still quite small, covering six cities in China. It started up in 2011. It makes money by taking a cut of the bill – usually around 10 percent – from the restaurants that people order from.

Meican’s latest funding comes 13 months after its series B round, which was worth US$10 million. Both KPCB and NGP are return investors.