Luo Min, the founder and CEO of Chinese tech firm Qudian, changed his Douyin account name on August 2 to “Qudian Precooked Dishes.” Moreover, all videos related to Luo Min on the account were deleted, while only seven videos related to food business were retained.
In addition, the number of fans of his Douyin account has now been reduced to 4.723 million, down 360,000 compared with its highest level. In addition, Luo Min deleted all past posts on Weibo. On August 2, Luo posted a message in his fan group, saying that he might not do livestreaming for some time, and that his work would now focus on supply chains, food research and development, food quality and so on.
Founded in March 2014, Qudian has served as a connector between financial institutions and users, with the original aim of empowering financial institutions and helping them improve their marketing and operating efficiency. On October 18, 2017, Qudian was listed on the New York Stock Exchange. Qudian started its business through providing loans for college students, and it later faced stricter supervision from regulators.
Since 2017, Luo Min has attempted to transform into many fields, including automobile retail, luxury e-commerce, and K12 education, all of which were not progressing smoothly. In May of this year, Luo Min uploaded his first video on Douyin, the Chinese mainland version of TikTok. Most of the livestreams on Luo’s channel focus on precooked dishes. After the livestreaming business started, Luo Min announced that Qudian would no longer be a cash loan company, but a food company.
However, the precooked dishes business of Qudian has been resisted by web users. Luo Min held an investment promotion conference for the new business model in July. At the conference, Luo announced that the company will help 100,000 users open offline precooked dishes stores through providing loans in the future, without charging brand licensing fees. Its target group is reportedly housewives. Therefore, some have questioned whether Qudian sells precooked dishes, or provide loans for operators of offline stores.
In addition, some users have bought expired and deteriorated precooked dishes through Qudian’s platform, although the firm has not confirmed this. Qudian does not set up its own production line, but adopts an OEM mode. This means the company has weak control over product quality.
In May this year, NYSE notified the company that its average closing price of ADS was lower than $1 for 30 consecutive trading days, which did not meet the listing standard of the exchange. After entering the precooked dishes business, its stock price was indeed boosted, once rising by over 40%, which changed the situation that it was on the verge of delisting. On August 2, the notice letter of NYSE confirmed that the transaction price of ADS of Qudian had re-met the standards for listing.