LEGO Injects Millions of Dollars in Chinese STEAM Education Startup

Author: Qasim Khan Editor: Luke Sheehan Nov 08, 2019 06:18 PM (GMT+8)

A children’s art training firm raises a B+ round as China’s STEAM education sector continues to grasp the attention of the capital investors.

Paint brushes. Image credit: Yannis Papanastasopoulos/Unsplash

Hualala Kids' Art (画啦啦少儿美术), a children’s online art training firm, has raised an undisclosed amount for its Series B+ round. Lego led the round of investment with existing investors Qiming Venture Partners (启明创投) and Matrix Partners China (经纬中国). This is the first time LEGO has invested in a Chinese startup. 

To date, the company has raised a total of five rounds of financing, with Series B and B+ both being raised in 2019. The amounts of all five rounds have not been disclosed as yet.   

According to the Hualala’s website, it was established in 2015 and focuses on arts education for children aged 5-12. With picture books and animations, the curriculum system is based on the American K12 visual arts textbook.

While talking to EqualOcean, the company said that the R&D teams consist of around 50 members with more than 500 fulltime teachers. Last year the company switched from 1-on-1 to a small class model, which makes sense because, unlike language training, there is no interactive demand in arts training.

In terms of services, taking full advantage of the internet and data, the firm sends personalized information about the child’s performance and growth to their parents by the end of each month.

Li Wei, the founder and CEO of Hualala, said that the funds raised in this round will be used to upgrade the online art teaching system, research and development of online courses, hiring of high-quality teachers and improvement of the management team.

Even with a low capital environment, STEAM education companies in China have continued to raise funds. In the past two years, children’s art training and programming educational companies have received a lot of attention; but it seems that the subsectors are turning cold as the declining number of financing events becomes evident.

After an elevated beginning to the year, the total amount of investment for education in China in September dropped sharply, amounting to only 1/3 of the tally for August. It went from CNY 2.1 billion in August to CNY 732 million in September. 

STEAM ranked first, with eight firms raising funding. It was followed by K-12, early childhood education and vocational education.

Compared with July and August, financing activities in the K12 sector have increased significantly, but from the perspective of the financing volume of each sub-sector, the amount of financing in September is still less than that of STEAM.

STEAM took the top spot in the amount of financing as well. It contributed nearly CNY 400 million to the total amount of CNY 732 million, accounting for 54% of the total amount, showing the sector is favored by capital.