Adopt A Cow’s new funding round was co-led by KKR and DCP Capital.
Founded in 2016 by Xu Xiaobo, Adopt A Cow primarily produces and sells milk, yogurt, cheese sticks and milk power products in China. It has a vertically-integrated business model covering alfalfa growing, dairy farming, milk processing, and technology-enabled marketing. Over the past five years, the company has become one of the fastest growing direct-to-consumer brands in China, and has accumulated more than 10m customers.
Xu Xiaobo built the company’s first large-scale modernized dairy farm in Gucheng, Hebei Province in 2014, before launching the Adopt A Cow brand in October 2016 in Hangzhou, Zhejiang Province.
Adopt A Cow will use the new funding to accelerate the construction of modernized dairy farms and smart production factories, bring in Australian dairy cows and further integrate the company’s digital operation platform to enhance efficiency, improve product quality and brand competitiveness. KKR will support the company’s business growth by combining its experience investing in China’s technology and consumer sectors with its global industry knowledge and network of resources.
“Today marks an exciting new chapter for Adopt A Cow as we accelerate our strategy to bring our high-quality dairy products to more consumers in China,” said Xu Xiaobo, founder of Adopt A Cow.
“KKR has a proven track record of investing in the dairy sector and providing value-added operational support to homegrown technology champions, and we look forward to working with them to take Adopt A Cow to its next level of success.”
“Consumption upgrades and food safety are among the key focused themes for our investments in China. As a traditional industry, the dairy sector in China is going through an exciting period of technological innovation, driven by the fast development of IoT, increasing penetration of Ecommerce and digital marketing, and higher demand for naturally healthy and nutritious products,” said Chris Sun, a managing director on KKR’s China investment team.
“China’s economic growth is benefitting from the expansive and rapid adoption of digital technologies that are bringing convenience into people’s everyday lives,” said Karen Zhang, who leads KKR’s technology strategy in China.
“This is creating attractive opportunities to support the innovative Chinese companies, like Adopt A Cow, that are transforming their industries for the digital economy.”
KKR is making the investment from its Asian private equity fund, which builds on the company’s history of investing in China’s dairy sector, including previous investments in China Modern Dairy and Asia Dairy.