This is an English adaptation of a FoodBud historical article originally published on October 15, 2021.
Heytea's investment activity in 2021 suggested a broader push beyond freshly made premium tea. After investing in Seesaw Coffee, the company also invested in Anhui Green Tomato Biotechnology Co., Ltd., taking a 15% stake.
That company operates YePlant, a plant-based brand founded in 2020. Its largest shareholder was Wu Lingbo, founder of Minority Coffee, with a 46.25% stake.
At the time, YePlant's core product was oat milk. The brand said it planned to expand later into functional plant-based health-management drinks and high-protein, high-fiber plant-based meal-replacement beverages.
Sales channels included:
Key products and prices included:
The founding team came from Minority Coffee and coffee-equipment backgrounds. Within less than a year of launch, the brand had become China's second-largest B2B oat-milk supplier, according to the article.
YePlant had entered or partnered with more than 100 boutique independent cafes, coffee chains and tea beverage brands, including JPG Cafe, Manner and Scientist Cafe. Online, it had opened a Taobao store and was preparing to launch on Tmall Flagship Store, Tmall Supermarket and JD's self-operated channel. It also worked with Penguin Guide's food-and-drink marketplace, where more than 10,000 cans were launched initially.
FoodBud's read was that Heytea's investment logic had two layers: entering a high-growth adjacent category and acquiring access to strong specialist talent.
After its investment in Seesaw, Heytea's move into oat milk suggested it was still looking for new growth categories after completing a new financing round. FoodBud argued that a RMB 60 billion valuation would be difficult to support on high-end freshly made tea alone.
The article cited China as the world's largest plant-based milk market, while penetration in Europe, the United States and Japan continued to rise.
In 2020, the global plant-based milk market reached USD 16.88 billion, representing 9.4% of the liquid milk category. Over the previous three years, CAGR was 4.8%, with penetration rising modestly.
China accounted for 34% of the global plant-based milk market in 2020, mainly because plant-based milk products such as soy milk, almond milk and coconut milk already had high penetration. Euromonitor data cited in the article showed that, while China's plant-based milk market had been relatively stable over the previous five years, the US, Western Europe and Japan had grown faster, with CAGRs of 8%, 12% and 8%, respectively.
Oat milk was also becoming a coffee companion. According to Starbucks' 2020 food-related initiative data cited in the article, oat coffee sold 62 million cups in one year.
Specialty coffee and beverage brands including Seesaw Coffee, Manner Coffee, %Arabica and Saturnbird had launched oat-based products, with Oatly as a major partner. On Dianping recommendation lists cited by FoodBud, Seesaw Coffee's oat latte, Manner Coffee's oat milk and osmanthus oat latte, and %Arabica's oat milk latte all ranked among each store's top 10 items.
Oatly's market value was about USD 8.8 billion at the time, creating a benchmark that attracted domestic startups. Media statistics cited by FoodBud said that from April 2020 to February 2021, more than 200 new oat-milk companies were registered in a single month at peak, and the total had accumulated to an estimated 5,000. In the prior year, the oat-milk sector had seen more than 20 financing rounds; oatoat, for example, completed three rounds within less than a year and raised tens of millions of RMB.
Tmall data cited in the article showed that in 2020, China's plant-protein beverage market grew 800%, the number of purchasers rose 900%, and the oat-milk category grew 212%, ranking first by growth rate in the food and beverage category.
In 2019, Oatly had partnered broadly with the three leading new-style tea players: Heytea, Nayuki and Lelecha. After Heytea invested in YePlant, FoodBud asked whether Oatly might be replaced in some of those use cases.
Wu Lingbo, founder of Minority Coffee, was the 2014 China champion of the World Coffee Cup Tasters Championship. Chief roaster Chen Shenghao was the 2019 China champion of the World Coffee Roasting Championship and placed sixth globally, which the article described as the best result achieved by a Chinese competitor in that global event at the time.
FoodBud noted that Minority Coffee had strong product instincts across coffee beans, offline cafe operations and brand tone, and that its style matched Heytea's. As YePlant's largest shareholder, Wu Lingbo was positioned as an important part of the investment appeal.
While researching Anhui Green Tomato Biotechnology, FoodBud found recruitment information related to BeamTimer. The article said it was unclear whether the BeamTimer brand had been placed into the YePlant company, and that BeamTimer and YePlant might not have a direct relationship.
FoodBud then drew on BeamTimer's public account to describe Minority Coffee's philosophy. FEW and BeamTimer were two cafes under Minority Coffee, which had been operating for seven years.
Minority Coffee said every bean it produced went through strict cupping and was roasted to a defined state. Each batch carried a different number, and beans were stored for seven days after passing roasting checks so they could be reviewed and calibrated.
In a self-introduction on BeamTimer's public account, the brand described coffee as a non-essential product that becomes part of daily life only after people fall in love with it. It also said its original motivation was simply that good coffee should come in good-looking packaging.
On its vision, BeamTimer said its work was to give people better choices after they became attached to coffee. It did not frame coffee as a business that would "change the world," but rather as a category that provides appealing taste, smell and visual experiences while selling a kind of habit.
FoodBud connected this to an anecdote from Wang Xiaolong of Baifu Holdings. Wang said that when Seesaw was raising funds in 2021, many investors visited but thought store-opening speed and development were too slow. He then introduced Seesaw to Heytea founder Neo Nie. Neo asked Seesaw's Sally one question, "What was your original intention?" and then decided to invest.
FoodBud's conclusion was that Minority Coffee's own sense of purpose and product focus may have resonated with Heytea in a similar way.
Note: valuation, market-cap, financing and forward-looking product-expansion figures are historical and refer to the article's 2021 context.