Xibei has found itself at the center of another public controversy. On September 4th, a report by Sina Technology's "BUG" section revealed that multiple former Xibei employees claim their 2025 year-end bonuses, severance packages, and share buyback payments have not been disbursed according to the original agreements. In late July, Xibei modified its payment terms, extending the settlement period to 2028. A source from the investment community told Pencil Dao that Xibei had originally planned to go public this year, but "due to the Luo Yonghao incident, that plan is now off the table, leaving investors uncertain about their funds."
Where the IPO Journey Stalled
Xibei's pursuit of an IPO was not a sudden decision. As early as 2020, following the impact of the pandemic, founder Jia Guolong publicly shifted his previously cautious stance toward the capital markets. He explained at the time that the pandemic made him realize that restaurant businesses need a stronger capital structure to withstand risks. By September 2022, Jia had specified the timeline further: Xibei planned to list in 2026 and was preparing its IPO according to Hong Kong Stock Exchange requirements. At the 2023 annual meeting, he reiterated the goal of completing an IPO by 2026 after sustained development from 2023 to 2025, setting a target of a "100-billion-yuan market value."
The turning point came in September 2025. Luo Yonghao publicly questioned Xibei's heavy use of pre-processed ingredients and its pricing strategy, sparking a controversy that lasted for months. In the early days of the incident, Jia Guolong revealed that daily revenue across all Xibei stores initially dropped by about 1 million yuan, with projected losses of 2 to 3 million yuan per day subsequently, alongside a noticeable decline in customer traffic.
These escalating pressures soon reached the store level. In January, Jia Guolong confirmed that Xibei planned to close 102 stores in the first quarter, affecting approximately 4,000 employees. He noted that after the controversy, store operations came under significant strain, with cumulative losses exceeding 500 million yuan; he further estimated that total losses from September 2025 to March 2026 could surpass 600 million yuan. At this point, going public ceased to be Xibei's most urgent priority. In fact, when asked about the listing plan by Daily Economic News after the incident, Jia's tone had cooled considerably, stating that he was "neither opposed to nor actively pursuing" an IPO.
Reorganizing the Cash Flow
If store closures reflect operational pressure, the delayed employee payments make that pressure far more tangible. In late February, reports emerged of significant staffing adjustments at Xibei's headquarters. According to arrangements made at the time with certain employees, wages could be deferred while store cash flows remained negative; these deferred amounts were originally scheduled to be settled between July and September. The 2025 year-end bonus, already postponed to July 10th, was to be paid with 6% annual interest. For dismissed employees, the original severance plan was primarily concentrated within 2026: 20% paid the following month, 30% at the six-month mark, and the remaining 50% by the end of 2026. Share buyback payments for departing employees were also slated for phased completion by the end of 2026.
However, by the end of July, the timeline was pushed back again. According to the revised plan obtained by the "BUG" report, some severance payments will now be spread across 2027 and 2028. The share transfer payments have been deferred further, potentially not being settled until December 31st, 2028, depending on the company's business recovery. Employees told the report that during an online meeting before the agreement was altered, Jia Guolong asked for their trust in the company's ability to recover, stating that "payments cannot be made promptly right now." As of the publication of the Sina Technology report, Xibei had not publicly responded to these contractual changes. What is clear is that a major restaurant chain, suddenly thrown off course, is now reorganizing its finances: first by shrinking its store footprint and cutting costs to stabilize operations, and only then gradually addressing financial obligations to staff and shareholders.
Valuation Declines by 95%
Among Xibei's early public investors was Jingheng Investment, which participated in the company's angel round in 2017 and continued investing through entities like Beijing Jingheng Investment and Qingdao Jingheng Growth Venture Capital in 2021. Public records indicate that as of early 2026, Jingheng Investment still holds approximately 3% of Xibei's equity. In 2025, Xibei's capital activities accelerated significantly. That year, Xinchao Media joined its shareholder list. According to materials disclosed during Focus Media's acquisition of Xinchao Media and related reports, Xinchao Media invested around 100 million yuan in Xibei between January and September 2025, increasing its stake from roughly 0.27% at the start of the year to about 1%.
Even during the most stressful operational phase, capital did not entirely abandon Xibei. In January and March, Xibei completed two financing rounds within three months. The January round included investors such as Taizhou Xinrongtai, wholly owned by Xinrongji founder Zhang Yong, and Hangzhou Zhouxuan Equity Investment, where former Ant Group CEO Hu Xiaoming serves as the executive partner. Registered capital increased from 89.9 million yuan to 102 million yuan, an increase of about 13%. The March round brought in Lin Lairong, founder of Zhongxing Group and actual controller of Dazhong Mining, who acquired a 2.16% stake for a capital contribution of approximately 2.25 million yuan. Lin, a fellow native of Bayannur, Inner Mongolia, like Jia Guolong, ranked 504th on the 2025 Hurun Rich List with wealth of 13.5 billion yuan.
These two financing rounds appear more like support from friends than market-driven financial investments. Based on the 2.16% stake corresponding to a 2.25 million yuan contribution, Xibei's valuation in this round is estimated at around 1.04 billion yuan. Compared to the peak expectation of roughly 20 billion yuan, this represents a 95% decline. Qichacha data shows that Xibei remains on Inner Mongolia's 2025 IPO reserve list as a Class C listed company cultivation enterprise. Yet, the reality is that the 2026 listing target is no longer feasible. This makes Xibei's situation more complex. On one hand, it has experienced an operational shock rarely seen in its history, necessitating store closures, staff adjustments, and deferred cash outlays; on the other hand, some investors are still willing to inject real capital during this low point.
Jia Guolong is not standing still. He has launched a new brand, "Tianbian Shaguo Menmian" (a braised noodle concept), using Xibei's original locations and teams, and opened a barbecue chain called "Tianbian Yangduo" with an average per-person spend of 45 yuan, featuring lamb skewers, lamb shaomai, and lamb pizza. However, once the original IPO timeline changes, the impact on some financial investors extends beyond paper valuations to exit timelines. The most pressing question for capital now is when Xibei can again generate sufficiently stable profits, cash flow, and growth expectations. This is also why the deferral of employee compensation to 2028 and the shift in IPO plans are worth considering together. They ultimately point to the same issue: a restaurant company originally headed for the capital markets, after suffering a severe operational setback, is now re-prioritizing how it allocates its money.
This article does not constitute any investment advice.