Luckin Coffee
TL;DR
Chinese coffee chain founded in 2017 that demonstrates deception collapse and frequency-dependent fraud.
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Chinese coffee chain founded in 2017 that demonstrates deception collapse and frequency-dependent fraud. Grew explosively to challenge Starbucks but was exposed for fabricating $300 million in sales (40% of 2019 revenue). The case illustrates how dishonest signals can succeed temporarily but collapse when verification catches up.
Cautionary Notes on Luckin Coffee
- Fabricated ~40% of 2019 revenue
- Stock collapsed 80% in single day
- Delisted from NASDAQ
- Founder and executives banned from officer/director roles
Key Facts
2017
Founded