How Hefei’s First Crowdfunded Café Failed After 86 Investors Pulled Together

In 2012, a group of dreamers in Hefei came together to open what they hoped would become a community hub—a crowdfunded coffee shop called Weishiguang. What began as a romantic idea quickly turned into a cautionary tale of too many cooks in the kitchen. Eighty-six people pooled their money, but despite clear structures and professional help, the café shut down in less than a year. The question isn’t just why it failed—but how a shared dream collapsed under its own weight.

Weishiguang raised 2,000 yuan per share from 86 investors but failed to return any of their money. The café lasted less than six months before changing ownership, leaving all contributors at a loss.

The Dream Begins: Crowdfunding a Coffee Shop

The idea for Weishiguang started with Kevin, a Hefei native working in Shanghai. Posting on Douban in February 2012, he invited people to invest 2,000 yuan per share to open a café that embodied “dreams and friendship,” aiming to become a landmark for Hefei residents. Within a month, nearly 30 people had joined, and eventually 86 shareholders came on board.

Shareholders came from across Anhui and other provinces, with varied backgrounds—office workers, business owners, and students. Investments ranged from 1 to 10 shares per person. The group elected a five-member shareholder committee, and a professional manager was hired to run daily operations, while an accountant kept the books transparent.

The location was set in Yinping Lane near Baohe Wanda, and the group used votes to decide on the interior design and concept. A written agreement wasn’t made—trust and verbal promises held the project together, coordinated mainly via QQ.

Why It All Fell Apart

Despite professional management and a system of regular financial reporting, Weishiguang struggled to unify its many voices. According to Mao Die, one of the original shareholder committee members who invested 5 shares (10,000 yuan), the problems stemmed from everyone wanting a say.

“Everyone felt like they were a part of the shop and wanted their own element in it,” Mao Die said. Although a designer was hired and shareholders agreed not to interfere with the build, dozens of opinions during the eight-month preparation period led to paralysis. The same issue carried into the café’s operation. With no clear decision-making hierarchy, progress stalled.

The café’s diverse design elements reflected this lack of cohesion. Just six months after opening, unable to turn a profit or reach consensus, the business was sold off. None of the original investors recovered their money.

What the Lawyers Say: Risks of Crowdfunding

Cheng Lin, head of Anhui Shenghong Law Firm, explained that while Weishiguang had taken basic legal steps—like registering the business and consulting a lawyer—it ultimately fell victim to its structure. “This case didn’t end in major financial harm because the investors weren’t in it for the money, and their individual stakes were small,” Cheng said. “But it’s a warning.”

He warned that larger-scale crowdfunding projects often lack transparency, putting participants at risk of fraud. Furthermore, China’s regulatory framework for crowdfunding remains weak, creating opportunities for questionable practices. Disputes, he predicted, will likely surface in greater numbers over the next couple of years.

“People should only join crowdfunding projects with clear financial oversight, trusted operators, and businesses they truly understand,” Cheng advised.

Frequently Asked Questions

How many shareholders did Weishiguang have?

Weishiguang had 86 shareholders who collectively invested in the café.

How much did each share cost in the Weishiguang crowdfunding campaign?

Each share in Weishiguang cost 2,000 yuan, with investors able to buy between 1 and 10 shares.

Why did Weishiguang fail so quickly?

Weishiguang failed primarily due to conflicting opinions among shareholders, lack of centralized decision-making, and an inability to unify on design or operations despite having a professional manager.

Did the shareholders get their money back?

No, none of the 86 shareholders recovered their initial investments after the café changed ownership within six months.

Was there a written contract among Weishiguang’s investors?

No, the collaboration was based on verbal agreements and trust, with no formal written contract among the shareholders.

What did the lawyer say about crowdfunding risks?

Lawyers warned that crowdfunding can lead to disputes or fraud, especially when financial oversight is lacking and regulations are unclear, as was the case with Weishiguang.

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