Online teaching startup Zuoyebang raises US$750m

Sector expected to bring ‘revolutionary changes to the education industry’

Online teaching startup Zuoyebang raises US$750m
A Chinese netizen browses the website of Chinese online education company Zuoyebang. Chen jialiang / Imaginechina / Imaginechina via AFP

(ATF) Zuoyebang, China's largest online education startup in terms of user base, announced on Monday that it has raised $750 million in its series E round of fundraising, as China speeds up its embrace of the sector amid the coronavirus pandemic.

Led by FountainVest Partners and Tiger Global, the new round attracted investors including Qatar Investment Authority, Sequoia Capital China and SoftBank Vision Fund. China TH Capital continues to serve as its exclusive financial adviser.

With the fresh financing, Zuoyebang will continue to invest in the services as well as product research and development," Hou Jianbin, founder and CEO of Zuoyebang, said.

China's online education sector is developing at a rapid pace but its core competitiveness still lies in the product and quality in service, Hou said.

"We hope to create value for users continuously,” Hous added. “We will also beef up presence in exploring new models and businesses.”

Frank Tang, chairman and CEO of FountainVest Partners, said: "We are fairly bullish on the prospects of online education in China. Zuoyebang has become a leader in online education thanks to its continued investments in teaching, research and technology."

"We are delighted to be a shareholder in Zuoyebang, and we look forward to leveraging our industry expertise and network of portfolio companies to help the company in its next stage of growth," Tang said.

Founded in 2015, Zuoyebang is an online after-school mentoring platform. Its core businesses include Zuoyebang Yike, an online livestreaming course, and a tool to search question answers.

According to Hu Wenqin, managing partner at China TH Capital, education plays an important role in promoting social public services. If a company only focuses on top-tier cities, then it is drifting away from such a critical role.

"Its ability to reach students ranging from top-tier cities to fifth-tier and even remote areas, competitiveness in managing the online wave and technology, as well as the team's continuous upgrading in strategic management, made us believe that the firm will bring revolutionary changes to the education industry," Hu said.