Chinese digital collaboration company Black Lake Smart Manufacturing (HeiHu ZhiZao) has secured over $77 million (nearly CNY 500 million) in a Series C round of funding led by Singaporean venture capital firm Temasek Holdings, Chinese private equity investor Huaxing Growth Capital (China Renaissance), Lightspeed China Partners, GSR Ventures, Bertelsmann Asia Investments (BAI Capital), GGV Capital, and ZhenFund. The round was overseen by Taihe Capital.
Black Lake was founded in 2016 by its current Chief Executive Officer, Zhou Yuxiang. The startup helps factories and manufacturers to digitize their operations through its industrial software platform. It focuses on creating custom “collaborative SaaS software for manufacturing that uses data to drive production efficiency.”
In an interview with TechCrunch, Zhou explained the different pain points Black Lake aims to solve with its platform: “Factories had a lot of money and could buy top-of-the-line equipment. But on the software management front, they were still very primitive … Most of the operation was done on paper. Every day, workers received a stack of papers telling them what to do, and in turn, they filled up the sheets reporting what material they had used … When you acquire these financially underperforming factories in Europe, you realize their software infrastructure capabilities are still far superior to yours.”
Since launching its cloud-based SaaS platform in 2018, the company has served manufacturing companies across Mainland China, Hong Kong, Macau, Taiwan, and Southeast Asia. Black Lake provides customized solutions for its clients by utilizing an onboarding system similar to building Lego blocks. Clients can customize the software’s functions based on their needs. Black Lake leverages its platform by offering a more affordable option for its services at roughly $46,000 (CNY 300,000) annually as compared to other foreign SaaS platforms at $464,000 (CNY 3 million).
BAI Capital Managing Director William Zhao told KrASIA in an interview: “We witnessed that under the leadership of Yuxiang and his team, the firm has evolved to a Platform-as-a-Service plus SaaS system, connecting data in industrial execution, middle-layer collaboration, and top-level management and now serving as a portal for various other industrial software.”
Black Lake plans to use its fresh capital to invest in product development, manpower, market expansion, and to create an open platform for third-party partners. Instead of investing in developing different kinds of programs to meet its clients’ needs, the company decided to open up its platform and partner with companies such as Huawei, Alibaba, SAP, and McKinsey, which specialize in telecommunications, cloud computing, automation, and consulting. The company also plans to leverage its latest partnership with the Singaporean Temasek Holdings to further penetrate the Southeast Asian market, specifically in Vietnam and Malaysia.
Open, shared data is the future of China’s industrial world: Black Lake