When the last round of financing before IPO is completed in June 2021, the valuation of Youlan International will be 3.3 billion yuan.
On May 20, Youlan International Holdings Co., Ltd. (hereinafter referred to as "Youlan International") announced that it had signed a final business merger agreement with the publicly traded Special Purpose Acquisition Corporation (SPAC) Distoken Acquisition Corporation (hereinafter referred to as "Distoken"). The merged company will be named Youlan Group and will continue to be listed on NASDAQ with the stock code of "YOUL". The transaction is expected to be completed as soon as November 2024. Source: Announcement screenshot Founded in 2014, Youlan International is a comprehensive service provider for blue collar talents. Its main businesses include vocational education services, talent recruitment services, employee management services and market services. Opening the prospectus of Youlan International, an ordinary person's entrepreneurial success story unfolded slowly. The founder, Wang Yunlei, was a middle school Chinese teacher. After eight years of teaching, he entered a state-owned enterprise and worked as an ordinary employee to become a human resources executive. In 2008, Wang Yunlei resigned again to start his own business. In 2014, Wang Yunlei decided to transform to the Internet and build a Chinese blue collar service platform - Youlan.com. In the same year, Youlan International was officially established. This is a huge market. The Research Report on the Employment of Blue Collar Groups in China (2022) mentioned that among the 747 million employed people in China, the number of blue collar groups reached 400 million, accounting for more than 53%. On the one hand, Youlan International improves the quality of talents through vocational education and training, and improves the supply quality of blue collar talents; On the other hand, through Internet technology, the service efficiency and matching efficiency of blue collar talents are improved, and the structured supply and customized training of blue collar and skilled talents are realized. According to the prospectus, Youlan International has successively completed five rounds of financing, namely, Round A, Round B, Round B+, Round C and Round C+, attracting the attention of well-known investors, including New Oriental Industrial Fund, Sanqi Mutual Entertainment, Sino Ocean Capital and other institutions. When the last round of financing before IPO is completed in June 2021, the valuation of Youlan International will be 3.3 billion yuan. In its prospectus, Youlan International said that with an annual revenue of 670 million yuan, the company has become the largest blue collar lifelong service platform in the market. At the end of 2022, Youlan International officially launched a sprint to the Hong Kong Stock Exchange to expand the vocational education sector with the help of the capital market. According to the data, in 2019, 2020 and 2021, Youlan International achieved operating revenue of 665 million yuan, 636 million yuan and 738 million yuan respectively. In the first half of 2022, Youlan International achieved revenue of 304 million yuan, a year-on-year decrease of 21.51%. From the perspective of income structure, employee management business is the company's main source of income. From 2019 to 2021, the revenue from employee management services of Youlan International will be 610 million yuan, 540 million yuan and 568 million yuan respectively, accounting for 91.7%, 84.9% and 77.1% of the total revenue. In the first half of 2022, the proportion of employee management service revenue will further decline to 67.8%. Is blue collar education service a good business behind Youlan International. According to the information of Insight Consulting, the market size of China's blue collar lifelong service industry in terms of revenue has increased from 711.3 billion yuan in 2016 to 1190.3 billion yuan in 2021. The compound annual growth rate from 2016 to 2021 is 10.8%, and is expected to reach 2224.5 billion yuan in 2026, with a compound annual growth rate of 13.3%. However, Youlan International is in a highly decentralized and competitive market environment. According to the information of Insight Consulting, the top five blue collar lifelong service platforms in 2021 will only account for about 0.2% of China's blue collar lifelong service market. Under the condition of highly dispersed market and numerous competitors, Youlan International needs to further build its own moat.
