While the Covid-19 pandemic has wreaked havoc over large parts of China’s economy, the public health crisis has also brought opportunities to the country’s online tutors, making them desperate for fresh capital for expansion.
The latest beneficiary is six-year-old Baidu-backed Zuoyebang, which said in a WeChat post Monday that it has closed a $750 million series E funding round led by FountainVest Partners and Tiger Global Management. Other investors include SoftBank’s Vision Fund, Qatar Investment Authority, Sequoia Capital China, Tiantu Capital and Xiang He Capital.
The fundraising comes amid a boom in China’s online education industry that has taken off during coronavirus-induced lockdowns when students were asked to continue their studies through e-learning platforms.
Zuoyebang, whose name means “homework assistance” in Chinese, will use proceeds from the financing to develop new courses and products as well as explore new business models, the company’s founder and CEO Hou Jianbin said in a statement.
The Beijing-based company, which provides online courses and live-streamed video lessons to K-12 students, claimed that it has amassed 800 million registered users, of whom 12 million are paid subscribers, 170 million are monthly active users and 50 million use its services every day.
The company also said that it has seen strong growth in sales of its live-streamed video courses, whose paid users have increased by 10 times over the past two years.
Zuoyebang was founded in 2014 by online search giant Baidu as a platform where users could upload pictures of their homework for help. In 2015, it was spun off as a standalone company, in which Baidu has a stake.
Zuoyebang rivals a handful of online education startups in China, including Yuanfudao, which announced in March the receipt of a $1 billion investment from Hillhouse Capital, Tencent and other investors.
Contact reporter Ding Yi (firstname.lastname@example.org)