China has an insatiable appetite for boba, or bubble tea. The proof? The drink has helped another man become a billionaire overnight.
Guming Holdings recently launched a $233-million (over ₹2,013 crore) IPO, which increased the net worth of its own Founder, Yun'an Wang, to $1.2 billion, making him a part of the billionaires club, according to Bloomberg data.
The company's shares rose as much as 4.6% to about $1.3/share on Wednesday before trimming gains. The bubble tea market was worth $9.6 billion in 2018 and is forecasted to grow to $71 billion in three years.
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Guming Holdings sells boba tea under the ‘Good me’ brand name and targets smaller cities and townships, where bubble tea is not readily available.
How it started
Wang had started his first store in his hometown of Daxi, a tiny place by Chinese standards with a population of under two lakh, nearly 15 years ago. According to local media, there were days when he would only sell around 100 yuan ($14) of tea a day — even after selling some drinks to his co-founder.
Since then, rapid growth has helped his company expand to nearly 10,000 stores and emerge as the second-largest brand among freshly-made bubble tea makers in terms of total sales and number of stores by the end of 2023.
Guming’s Good me had a market share of 9.1% as of the end of 2023 among China’s top five bubble brands, trailing only Mixue’s 20%, according to the research.
Who's the billionaire?
Wang's parent ran a small retail business near the border with Myanmar. He pursued a bachelor's degree in material science and engineer in 2010 from Zhejiang Sci-Tech University, the same year he opened his first boba tea store.
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As of September, Wang's company Guming Goldings was present in 17 provinces across China.
The industry is “always full of crazy promotions,” Guming’s Wang said in an interview to Southern Metropolis Daily in December 2023. “We are already used to a price war. Every year there will be a new bubble tea brand popping up.”