Luckin's Former CEO Takes Over Cotti Coffee! Is a Second Luckin Coffee Coming?!

Qian Zhiya Takes Over as Legal Representative of Cotti Coffee

Tianyancha data shows that the legal representative of Cotti Coffee (Tianjin) Co., Ltd. recently changed. Wang Baiyin, a Peking University classmate of Lu Zhengyao, the former chairman of Luckin Coffee, has withdrawn, and has been replaced by Qian Zhiya - Lu Zhengyao's protege and former CEO of Luckin Coffee - who now serves as legal representative.

According to public information, Cotti Coffee (Tianjin) Co., Ltd. was established in May 2022 with a registered capital of 100 million US dollars. Its business scope includes catering services, food sales and internet food sales, and it is wholly owned by MAIN MARVEL LIMITED. Notably, in addition to serving as legal representative of Cotti Coffee, Qian Zhiya also holds the positions of executive director and manager in the company.

Qian Zhiya was born in 1976 and graduated from Wuhan Textile University in 1998. She holds an EMBA from Peking University. She previously served as director, vice president and operations director of Shenwu Group; executive vice president of Car Rental Co., Ltd.; and CEO of Luckin Coffee.

Outsiders have long seen Lu Zhengyao and Qian Zhiya as having a mentor-protege relationship. When Qian Zhiya first came to Beijing from Wuhan in 2004, she met Lu Zhengyao. After that she followed him into business, doing odd jobs at first, until they later established CAR Inc. Lu Zhengyao recognised her ability and appointed her executive vice president and operations director of CAR Inc.

Her career could be described as smooth sailing. At the time she managed more than 1,000 stores nationwide, 100,000 operating vehicles and 40,000 employees. Every strategic plan and partnership of the company was her responsibility.

In November 2017, Qian Zhiya officially resigned from her former employer for personal reasons. She was already 41, originally at the prime of her career. After leaving CAR Inc., where she had worked for 13 years, she chose to start from scratch, venturing into coffee and establishing Luckin Coffee. The first Luckin store had already opened in Galaxy SOHO one month before she formally resigned.

When Qian Zhiya founded Luckin, half of the funding came from the support of Shenwu Group. Short of funds and customers at the time, Lu Zhengyao allocated part of Shenwu Group's headquarters space and rented it to Luckin Coffee for office use. His actions made clear that he strongly supported her entrepreneurial decision, and he indeed gave her great help. After Luckin was established, Lu Zhengyao was not only the chairman but also the company's largest angel investor, and their equity ratios were similar.

From a Record Listing to a Financial Fraud Scandal

On May 17, 2019, Luckin Coffee was officially listed on the NASDAQ in the United States. While others took more than twenty years to go public, Luckin set a global market record by listing in just one year. In the short 18 months before its IPO, Luckin completed four rounds of financing, with the first three arranged by acquaintances such as Li Hui and Liu Erhai. According to media reports, Qian Zhiya once publicly stated that Luckin was not short of money.

Then, in April 2020, Luckin Coffee "self-exposed" financial fraud. Two months before that admission, the short-selling firm Muddy Waters had publicly released an anonymous short-selling report accusing Luckin Coffee of alleged financial fraud: store sales, product prices, advertising expenses and net income from other products were all exaggerated. In the third quarter of 2019, Luckin's store operating profit was exaggerated by 397 million yuan. Afterward, Luckin immediately faced stock price declines, regulatory investigations and collective lawsuits from investors seeking compensation.

It was also required to delist from NASDAQ, with trading suspended until it fully met NASDAQ's requirements for supplementary information. Qian Zhiya did not speak out during this turmoil. Perhaps she recognised her mistake, because she resigned from her position at Luckin in June 2020.

Meanwhile, Lu Zhengyao, also a founder, after being "kicked out" of Luckin Coffee over the financial fraud, never stopped his entrepreneurial pace. His earliest project was shared space, followed by Qu Xiaomian, Shetan Yingxiong and now Cotti Coffee. After two years, the two - mentor and protege - have returned together "to" the coffee field. Facing an increasingly fierce competitive environment, however, whether Cotti Coffee can replicate Luckin's success remains to be tested by time.

Image source: Internet

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