Zhang Hongchao and Zhang Hongfu, two Chinese businessmen, started out small by running a shaved ice stand. Now, they’ve grown bubble tea into a multibillion-dollar company that’s about to go public. Their company, Mixue Bingcheng, is a standard example of someone who goes from having nothing to having everything by working hard and not giving up.
Zhang Hongchao, then 21 years old, borrowed money from his grandmother to open his first dessert shop in 2010 and sell bingsu, a famous Korean shaved ice treat. But the first source fell apart quickly.
Zhang didn’t give up and opened a second bingsu shop in 2012 called Sweet Ice Palace, or Mixue Bingcheng in Chinese. In this case, the business took off. Zhang quickly asked his younger brother Hongfu to help with day-to-day tasks.
The brothers came up with a great plan: they would sell tasty drinks like ice cream, lemonade, and finally bubble tea for incredibly low prices to beat out competitors. There were a lot of students who came because the prices were low and there were lots of sweet drinks.
Success was so overwhelming that Mixue Bingcheng quickly grew its low-cost menu and store space. Zhang Hongchao and Zhang Hongfu opened more and more stores across China. To keep their prices low, they chose small storefronts in places with lower rent.
Twelve years after starting up again, Mixue now has more than 36,000 shops in 500 Chinese cities and makes more than $7.3 billion a year. It is China’s biggest bubble tea chain, and it serves delicious fruit teas with cheese on top, coffee, and slushy dessert drinks all the time.
Co-founders Zhang Hongchao and Zhang Hongfu have made huge amounts of money thanks to the meteoric rise of Mixue and its tempting cheap drinks. It is thought by Forbes that the Zhang brothers are now billionaires because they own 70% of one of China’s most popular beverage brands.
Due to Mixue’s huge success, the company wants to split off its main bubble tea business through an IPO. With the IPO, the Zhang brothers’ personal wealth is likely to grow even more.
Mixue’s crazy low prices got it the nickname “the Pinduoduo of bubble tea,” a reference to the famously low prices of the Chinese online store Pinduoduo. Just like Pinduoduo’s business plan changed the way people shop online, Mixue’s low-cost tea has turned China’s bubble tea industry on its head and eventually taken it over.
Mixue Bingcheng went from a dirty bingsu stand to the world’s best bubble tea seller, which is an amazing story that shows how determination and trying new things can lead to a billion-dollar fortune.