Zuoyebang Nearing a New USD 650 Mn Financing Round
Investors continue to demonstrate their trust in — and focus on — Asia’s booming edtech market.
Soon after the announcement of Zhangmen's new round of more than USD 400 million, backed by SoftBank's Vision Fund, Genesis Capital (元生资本), CPP Investments, International Finance Corporation under the World Bank and CMC Capital, another online K12 education firm, Zuoyebang, declared it was closing in on another mega round of financing.
People familiar with the matter said that (in Chinese) Zuoyebang plans to raise approximately USD 650 million in this fresh round. Existing investors, including FountainVest Partners, Softbank, Sequoia Capital China and Tiger Global Management, are the round's potential investors.
However, an insider said in response to these rumors of being valued at USD 10 billion after the round, that the reported news is not accurate and did not provide further details. Besides, according to Chinese media channel Sina, FountainVest Partners declined to comment, while Sequoia Capital, SoftBank and Tiger Global did not immediately respond to reporters' requests for comment.
The financing of Zuoyebang comes at a time when the edtech industry is booming due to the epidemic. After the outbreak earlier this year, many countries have adopted corresponding measures. Students are required to study online at home, making the edtech industry one of the few industries that have flourished during these times.
Other than the above mentioned Zhangmen, another one of Zuoyebangs competitors, Tencent backed Yuanfudao, is about to complete a new round of financing worth USD 1.2 billion. It is reported that old shareholders Tencent, Hillhouse and Boyu Capital have participated in this round of funding.
Suppose the news is accurate. In that case, after the completion of this round of financing, Yuanfudao will be valued at more than USD 13 billion, making it the world's highest-valued online education unicorn company, surpassing Byju's.
Yuanfudao received USD 1 billion in a financing round just five months ago. Hillhouse Capital led the round, followed by Tencent, Boyu Capital and IDG Capital.