Douyin E-commerce and Source Code Capital jointly released the *New Brand Growth Trends White Paper*.

The maturation of a new generation of Chinese consumers, alongside the rise of new brands, signals fresh commercial opportunities. Seizing these timely chances means helping brands evolve from viral sensations to enduring names, connecting users with better living, and building global brands born in China.

On November 19, Douyin E-commerce and Source Code Capital co-hosted the "New Brand Development Trends Seminar," where they jointly released the New Brand Growth Trends White Paper (hereafter referred to as "the White Paper").

In the White Paper, Douyin E-commerce identified three key trends for consumer brands: "new brands, new business, new growth" — how brands can use content to connect users with better living and reshape the consumer journey. Through detailed case studies of Source Code Capital portfolio companies including Wang Xiaolu, Blank ME, Cloud Whale, PMPM, WonderLab, WANGBAOBAO, and usmile, the paper distilled growth strategies for new brands on Douyin E-commerce. Source Code Capital, from an investor's perspective, analyzed the growth trajectory of new brands, the fertile ground that digital transformation provides, and how new brands can build "product power" as a competitive moat.

At the seminar, Source Code Capital partners Wu Jian and Chang Kaisi, Douyin E-commerce Service Provider Lead Zhang Hao, Douyin E-commerce Merchant Strategy Lead Huang Tingfu, and portfolio company representatives from WonderLab, Cloud Whale, and PMPM shared their latest thinking. Going forward, Douyin E-commerce will serve as a growth platform for new brands, enabling "snowball-style growth." Source Code Capital's consumer investments include Cloud Whale, Pagoda, Linji, Blokees, PMPM, moody, usmile, WonderLab, ChaYanYueSe, Wang Xiaolu, and Xijiezhachuan, and will continue seeking new brands with technological and product strength.

"Interest E-commerce," Stimulating Incremental Demand from Upstream

At the seminar, Zhang Hao stated that the coming decade will be a golden age for both Chinese consumers and emerging Chinese brands. To become a long-term winner in this era, brands must start from product and content, prioritizing content operations, optimizing product supply, and strengthening consumption field construction. In 2021, interest e-commerce was defined as a model based on people's aspirations for better living, satisfying latent shopping interests and improving consumers' quality of life.

"Compared with traditional e-commerce and offline retail, Douyin's interest e-commerce uses recommendation technology to connect quality product content with massive pools of interested users, stimulating new consumption experiences and demands," Zhang said. "It effectively helps new brands overcome challenges like low brand awareness, imprecise user targeting, and the inability to balance brand building with performance marketing."

Huang Tingfu outlined the underlying logic of "new brand" exponential growth: "New brand growth can be roughly divided into three stages: launch, growth, and breakthrough. Each stage has different business objectives. New brands need to steadily build operational capabilities and achieve stable business leaps through a measured growth rhythm."

Unlike the funnel-shaped growth model of traditional shelf e-commerce, Douyin E-commerce follows a snowball rolling pattern: interest first, then stimulation, then purchase. The difference is that interest e-commerce starts from upstream — from people's interests and demands — giving merchants more opportunities.

An Investor's Lens: How Brands Survive Cycles

At the seminar, Chang Kaisi of Source Code Capital asked: "What do truly cycle-crossing brands have in common? We've found they always seize channel and media dividends. Historically, Procter & Gamble and Coca-Cola followed this same pattern. It's relatively easy to get started when you leverage the scale advantages of channels and media at founding."

Chang Kaisi, Partner at Source Code Capital

"But beyond that, product is king. Imagine a market with only brands A and B. Consumers enter randomly — brand A might retain 50%, brand B only 30%. Retention is the direct measure of product power. Focusing energy on product helps build lasting competitive advantages and capture market share faster. We've constantly emphasized this to our portfolio companies: product is king. Spend more on R&D."

Beyond domestic opportunities, Chinese brands have also developed global competitiveness. Chang believes that Chinese brands have built foundational strength to influence the world through technological innovation, supply chain advantages, channel capabilities, and cultural influence. The trend of Chinese brands going global is now a certainty, and Source Code Capital will help these enterprises bring Chinese products to the world, creating value for global consumers.

Founded in spring 2014, Source Code Capital is dedicated to discovering and supporting world-leading enterprises in technology-driven business transformation. The firm manages approximately RMB 35 billion across RMB and USD funds. Investing in technology, investing in great products, and supporting SME development have been consistent principles. The firm partners with outstanding entrepreneurs to use technology and innovation to enable better living.

On serving new brands, Wu Jian noted that Source Code Capital has developed post-investment services tailored to consumer brands' needs. In business development, it helps brands connect with national key research institutes and university departments to explore more efficient industry-academia-research translation and build R&D moats. In human resources, it focuses on recruiting top talent in e-commerce and operations. In early-stage PR, it assists with consumer communication and crisis response. In public affairs, it helps brands engage with industry associations and government regulators to build and amplify sector influence.

Zhang Hao, Douyin E-commerce Service Provider Lead (left), and Wu Jian, Partner at Source Code Capital (right)

New Brands: Sustained Growth Under New Trends

The New Brand Growth Trends Report provides detailed analysis of seven new brands — Wang Xiaolu, BlankMe, Cloud Whale, PMPM, WonderLab, WANGBAOBAO, and Usmile — tracing their journeys from zero to one.

Shan Shuo, Founder and CEO of PMPM, said: "Douyin E-commerce gives new brands an opportunity to build a brand stronghold. To consistently convey brand spirit and product advantages on Douyin, brands must personally construct their own methodology to deepen target consumers' recognition and affinity for the brand."

Wang Xiong, Founder and CEO of Wang Xiaolu, said: "Douyin has been crucial to Wang Xiaolu's growth, both as a communication medium and sales channel. The ByteDance team has been fully supportive throughout — providing professional, meticulous, and comprehensive guidance on traffic tools, strategy formulation and review, and content and performance optimization. Healthy collaboration drives mutual success for platform and brand."

Liu Le, Co-founder of WonderLab, said: "For new brands, Douyin E-commerce brings entirely new business thinking. How to create great content and build a business model around it — this is both a challenge and a massive opportunity."

Douyin E-commerce aims to help 100 new brands surpass RMB 100 million in sales within the coming year. Eligible "Douyin-native brands" will receive multiple support benefits including dedicated service, product privileges, traffic support, brand marketing resources, campaign exposure, and investment and financing assistance.

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