Source Code Capital Portfolio Company ZNLH Announces Completion of C1 Round Financing, Source Code Capital Led B Round

源码资本·August 3, 2020·3·2

ZNLH has maintained stable, scaled profitability for three consecutive years and will seek to go public when the timing is right.

On August 3, ZNLH, a leading domestic construction equipment service platform, announced the completion of its Series C1 funding round. This round was led by SPIC Industrial Investment Fund, a state-backed fund with central SOE credentials. The capital will be used to digitally transform the entire construction equipment industry chain, expand its service network, and recruit talent — all aimed at supporting the company's long-term, sustained high-speed growth.

Under the national "new infrastructure" initiative, construction equipment rental is poised for explosive growth, with massive potential in the sector. Globally, United Rentals — the world's largest equipment rental company — operates over 1,000 locations in North America, manages thousands of equipment categories, holds assets in the hundreds of billions, and commands a market cap exceeding $10 billion. Benchmarked against the United States, and based on projections for China's urbanization trajectory, China's construction equipment industry is expected to reach 2.5 times the scale of America's. As of 2019, China's stock of major construction equipment varieties had reached 8.86 million units, with asset value surpassing 3 trillion yuan. The construction equipment rental market alone approached 700 billion yuan, maintaining 10% annual growth. Through ecosystem-wide digital transformation of the entire industry chain, integrating resources, and improving asset utilization efficiency, China will inevitably give rise to a platform-based, ecosystem-oriented enterprise valued in the tens of billions of dollars.

ZNLH is a construction equipment service platform driven by digital operations and powered by technology across the industry's full-cycle trading system. It has built a service network covering 25 provinces, 4 direct-controlled municipalities, 300 prefecture-level cities, and 1,200 county-level districts, serving over 30,000 customers cumulatively.

ZNLH at the Beijing Daxing International Airport construction site

During the COVID-19 pandemic, ZNLH actively participated in the construction of Huoshenshan Hospital in Wuhan, Xiaotangshan Hospital in Beijing, and Xiaotangshan Hospital in Zhengzhou, making outstanding contributions to the national fight against the outbreak. It was listed by the National Development and Reform Commission among the key enterprises ensuring national pandemic response supplies. Following the pandemic, ZNLH quickly resumed production, with first-half revenue growing 200% year-over-year to hit a new record.

This strategic partnership between SPIC Industrial Investment Fund and ZNLH signals state capital's confidence in the vast blue ocean of China's construction equipment industrial internet, and represents full recognition of ZNLH's current market leadership. This collaboration marks a pivotal moment for ZNLH in reshaping industry form, while also heralding a new phase of development for the construction equipment sector.

Tianli Yang, co-founder and CEO of ZNLH, stated: "Through more than four years of deep cultivation in the aerial work equipment space, ZNLH has built a comprehensive equipment lifecycle management system, a customer lifecycle service system, and a full-cycle online closed-loop trading IT system. We've established clear industry leadership while steadily improving asset utilization efficiency. ZNLH has now maintained stable, scaled profitability for three consecutive years, and will seek to go public at the appropriate time in the future."

As a high-tech innovative enterprise driving digital transformation in the construction equipment industry, ZNLH's true mission is to continue leveraging its accumulated digital capabilities to better serve the sector. Currently in a strategic upgrade from version 1.0 to 2.0, ZNLH is committed to evolving from self-operated to platform-based, serving and empowering more customers, providing the optimal digital transformation path for the construction equipment industry, and contributing to the healthy development of the sector.