How Two Chinese Brothers Became Billionaires From $1 Bubble Teas

Summary

Two Chinese brothers, Jang Hongcha and Hang Fu, became billionaires with their bubble tea chain, Mishu Bing Chang. Starting with a small shaved ice stall, they expanded to 36,000 stores across China and other Asian countries. Known for their affordable prices, Mishu is now the second-largest global seller of freshly made drinks. The company is preparing to go public, with Forbes estimating it's worth around $2.9 billion, valuing the brothers' net worth at approximately $1.2 billion each.

Takeaways

• 🍵 Two Chinese brothers, Jang Hongcha and Jang Hang Fu, became billionaires from their bubble tea business.
• 💸 Jang Hongcha started with a small shaved ice stall and later transitioned to selling bubble tea at low prices.
• 📈 Mishu Bing Chang, their brand, now has around 36,000 stores and is China's largest bubble tea maker.
• 🏢 The company is on the verge of going public with an initial public offering in Hong Kong.
• 📊 In the first nine months of 2023, Mishu's revenue increased by 46% to $2.2 billion, and net profits grew by 48% to $338 million.
• 💰 Forbes estimates Mishu Bing Chang to be worth around $2.9 billion, giving each brother a net worth of approximately $1.2 billion.
• 💵 The brothers each hold a 42.8% stake in the business.
• 💼 Mishu Bing Chang has a strong presence in China with nearly all franchise stores and has expanded to 11 other countries.
• 🌐 It is the second-largest global seller of freshly made drinks, just behind Starbucks.
• 💲 The company is known for its low prices, earning the nickname 'Pinduoduo of bubble tea', due to its bargain prices.
• 🔄 Mishu maintains low costs through an end-to-end supply chain, including procurement, production, logistics, R&D, and quality control.

Q & A

What was the initial business venture of Jang Hongcha?

Jang Hongcha initially borrowed money from his grandmother to open a small stall selling shaved ice treats in the central Chinese city of Jung Joo.

What was the name of Jang Hongcha's second venture and what did it sell?

The second venture was named Mishu Bing Chang, which means Sweet Snow Palace, and it started by selling ice cream and later expanded to bubble tea, lemonade, and coffee drinks.

How many stores does Mishu Bing Chang have currently?

Mishu Bing Chang currently has roughly 36,000 stores.

What is the significance of Mishu Bing Chang's business model?

Mishu Bing Chang's business model is significant because it offers a wide range of beverages at very low prices, making it accessible to a large customer base.

What is the estimated net worth of Jang Hongcha and his brother Hang Fu according to Forbes?

According to Forbes, each brother holds an estimated net worth of $1.2 billion.

When did Mishu Bing Chang file for an initial public offering (IPO)?

Mishu Bing Chang filed for an initial public offering in Hong Kong last week, as mentioned in the script.

What was the revenue and net profit of Mishu Bing Chang in the first 9 months of 2023?

In the first 9 months of 2023, Mishu Bing Chang's revenue jumped 46% to $2.2 billion and its net profits jumped 48% to 338 million.

How does Mishu Bing Chang maintain its low prices?

Mishu Bing Chang maintains its low prices due to its end-to-end supply chain covering procurement, ingredient production, logistics, research and development, and quality control.

What is the average price range of Mishu Bing Chang's products?

Mishu Bing Chang's products cost between 3 cents to $1, which is significantly lower than the average price of $3.80 charged by other popular Chinese bubble tea chains.

How does Mishu Bing Chang generate most of its revenue and profits?

Mishu Bing Chang generates most of its revenue and profits from sales of supplies such as kitchen appliances and food ingredients to franchisees.

What is the global ranking of Mishu Bing Chang in terms of freshly made drinks sold?

Mishu Bing Chang is the second biggest global seller of freshly made drinks, with approximately 5.8 billion drinks sold worldwide during the first 9 months of 2023.

Who are some other notable figures in the bubble tea industry that have become billionaires?

Other bubble tea billionaires include Wang Xiao Kung, the founder of CHA Panda, and Pang Shin and Jiao Linn, the founders of Nayuki.