On 12 May, Meituan officially announced a commitment of US$1 billion investment for the Brazil market.
The deal was entered during a seminar attended by Meituan founder Wang Xing and President of Brazil Luiz Inácio Lula da Silva (Lula) in Beijing.
Meituan said that Keeta, its international food delivery subsidiary, will enter Brazil “in the next few months”, whilst the US$1 billion investment commitment will be for the next 5 years.
Wang Xing also said Keeta will build an on demand delivery network in Brazil, “focusing on improving consumer experiences, promoting the development of partner restaurants, and creating more job opportunities” in the country.
But wait, as mentioned at the beginning of the article, what is (literally) on the table? See the photo below:
Sharp-eyed friends will notice the Snow King, mascot of Chinese bubble tea and ice cream chain Mixue. With more than 45,000 outlets in China and 11 countries, Mixue is currently the largest F&B chain in the world by store count.
The Snow King on the table with President Lula was even bigger than the kangaroo mascot of Meituan on the table. Second (human) from the right on the photo with Lula was Mr Sun Zexu, a key Mixue executive.
Well, what happened was that Mixue announced, at the same meeting, “at least RMB 4 billion” (US$550 million) worth of coffee beans and other purchases from Brazil in the next 3-5 years. It also pledged to open stores and processing factories in the country.
“A very impressive deal indeed,” said a friend of Momentum Works who is very familiar with the Mixue leadership.
A few additional quick thoughts on Meituan’s incursion into Brazil:
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Mixue is not the only Chinese giant entering Brazil recently.
TikTok Shop launched in the country last week, joining the messy battle against other Chinese players
Temu, SHEIN, ALIBABA (and Chinese-inspired Shopee) in the country. - The “good relations” between the Lula government and China seem to be a big consideration for Meituan.
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In Brazil, Keeta’s major competitors will be Prosus-owned iFood, which currently dominates Brazil’s food delivery market, as well as China’s Didi, which will relaunch its 99Food in the country.
Didi tried food delivery in Brazil in 2019–2021, and could not break through iFood’s dominance. Whilst Didi’s assault on Meituan in food delivery in China in 2018 in Eastern China was a true epic.
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In the photo with Lula, Wang Xing has much more white hair compared to his previous public appearances.
The ‘forever wars’ with other tech giants have been a constant theme in Meituan’s 15-year history. It has won most of these battles (against giants including Alibaba, Didi, and even Douyin) — the only notable defeat was against Pinduoduo in community group buy.
- Many in the community of Momentum Works have asked us about the current competitive dynamics between Meituan, JD and Alibaba in the (recently reignited) food delivery and quick commerce war in China. We will share our perspectives in a separate commentary soon.
- In any ways, Wang Xing is only 46 years old, and can still hold the helm for at least a decade. As a friend who was previously at Meituan’s senior ranks said: “Brother Xing is so used to tough times. He will prevail.”
For more details about how Wang Xing of Meituan, and other Chinese tech leaders, rose to prominence and their approaches for international markets. You can read our book
Seeing the Unseen: behind Chinese tech giants’ global venturing
”, currently available in English, Chinese and Polish.
