(Yicai Global) March 24 -- China's online food ordering platform Ele.me is on its way to being profitable, said founder Zhang Xuhao during the Boao Forum for Asia when asked about the company's finances.
"We are on the way to making money," said Zhang when asked by a host at the conference today whether his company has become profitable after receiving investments totaling more than USD2 billion.
The host sighed in response to Zhang answer and said, "Can capital be rational? A company with USD2 billion in hand just said that it is on the way to making money."
The 32-year-old founded Shanghai Lazhasi Informational Technology Co. and launched the Ele.me in 2009. The platform received USD2.34 billion in financing, including USD1.25 billion from Alibaba Group Holding Ltd. and Ant Financial Services Group in April 2016 -- a single round financing record for online food ordering platforms. The company's valuation has exceeded USD4 billion.
Ele.me has spread across more than 700 cities in China, claiming more than 70 million users placing more than 5 million orders a day, public data shows.
"I think there are two types of start-up businesses. One type is more like traditional companies, which can make money from every product they made and keep revenue growing by keeping production. However, for internet companies, they are just like oil wells which require drilling over a long period of time before oil producing or blowouts, then it is possible for them to earn money invested in the last ten years back," Zhang said.
"For Amazon, a big company today, as well as Alibaba and Ctrip, they achieved profitability after five or six years of continuous investment. And now, in the entire online food ordering market, I feel that my company has arrived the final step before earning money," he said.
"The platform has been profitable in many cities. I believe that as long as the market keeps rising for some time, then we will earn the money that we invested in the past years back within one year, and we also see the prospects of the entire market," Zhang said.
"And so many people have invested us today. They are not fools, and their money is Smart Money," he added.
The 2017 Boao Forum for Asia is named for the city in China's Hainan province that it is being held in from March 23 to March 26.