CHINA (SCMP.com) - With the help of finance from three venture capitalists, ModernBooks.com has changed into a bigger online Chinese bookstore, with a business-to-business (B2B) sideline, called BooksCity.
Only a month earlier Chinese Books Cyberstore, Hong Kong's biggest Internet bookseller, went bankrupt after 3.5 years.
A few weeks ago, Hong Kong-listed Ocean-Land Group, which owns 70 percent of online bookshop ebookschina.com, said it would change the aim of its operations to B2B, instead of selling to retail customers in the SAR and the mainland.
BooksCity chief executive Johnny Sitou said the updated site and business has attracted support from Hong Kong-based AsiaTech Ventures, Ringier of Switzerland and A&A Dragon (Panama).
Neither Sitou, nor investor Anthony Fan, of AsiaTech, would say how much money was invested in BooksCity's renovation.
A unit of Modern Books Holding, the business was also aiming to penetrate the B2B book business in the mainland and Taiwan, Sitou said.
"We will become a truly global Chinese Internet bookstore very soon," Sitou said. "By the end of this year we will step inside the mainland market with B2B."
The company has links with mainland medical books publisher China Medico-Pharmaceutical Science & Technology Press to create a B2B offshoot.
The joint venture will sell books, magazines and other items to stores, Chinese Web portals and other Internet retailers.
Its second thrust is in Taiwan, where BooksCity has deals to supply books to BOOK4U and soidea.com.
Sitou anticipates a big jump in revenues from the company's B2B operations. He sees Hong Kong, Taiwan and Macau as part of his potential clientele and estimates there are up to 80 million overseas Chinese, in places such as the United States, Australia, Malaysia and Singapore.
He said the Web site already has a customer base of about 50,000, and many repeat buyers.
More offers are planned, including a mirror site in Taiwan.
By next month the company planned to license a platform to launch customer-relation management software, Sitou added.
The company, like many dot-coms, has failed to reach profitability after three years of operation, but expected to break even in 2002, Sitou said.
Earlier this year, hi-tech stocks suffered a serious setback. As a result the largely unprofitable dotcom industry, which had been bolstered by venture capitalists and investors, saw closures and layoffs.
Ocean-Land chairman Yuen Wai said the bankruptcy of Chinese Books Cyberstore had dampened the market's enthusiasm for online retailing, making it harder for smaller online bookshops to raise capital.