Luckin Coffee is a Chinese Starbucks competitor that has been taking China by storm. By January 2020, that’s only 2 years since opening their first store, they had a total of 4,507 stores, making them the largest coffee chain in China, surpassing even Starbucks.
However, on April 2nd Luckin Coffee announced that an internal investigation found that its chief operating officer, Jian Liu, and several others, had fabricated the company's 2019 sales by "around RMB2.2 billion" or $310 million USD. Trading of the stock has since been halted on the U.S. exchange.
In this video I share lessons of what we can learn from the Luckin Coffee disaster.
Articles shared in video:
https://finance.yahoo.com/quote/LK/
https://www.cnbc.com/video/2018/07/19/chinas-homegrown-luckin-coffee-takes-on-starbucks.html
http://investor.luckincoffee.com/static-files/fad0e07a-ac5a-4881-9ff3-fdc6af395f6f
https://secfilings.nasdaq.com/filingFrameset.asp?FilingID=13752710&RcvdDate=11/20/2019&CoName=LUCKIN%20COFFEE%20INC.&FormType=6-K&View=html
https://drive.google.com/file/d/1LKOYMpXVo1ssbWQx8j4G3-strg6mpQ7F/view
https://www.reuters.com/article/us-luckin-investigation-timeline/luckin-coffees-journey-from-hot-startup-to-5billion-share-wipeout-idUSKBN21L1HW
https://www.cnbc.com/2020/04/02/luckin-coffee-stock-plummets-after-investigation-finds-coo-fabricated-sales.html
https://www.cnbc.com/2020/04/03/luckin-coffee-debacle-is-a-painful-reminder-of-fraud-risk.html
https://www.fool.com/investing/2020/04/03/should-i-sell-luckin-coffee.aspx
https://www.benzinga.com/news/20/04/15753833/luckin-stock-drops-further-as-lenders-seek-to-seize-76-4m-shares-for-defaulted-loan
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