Leading Chinese mobile internet and game development company NetDragon has announced the the signing of a stock purchase deal worth US $52.5 million in Series A funding for its online education subsidiary. The company received its funding from international investors including IDG Capital Partners, Vertex Venture, and Shenzhen-listed animation producer Alpha Animation. The injection now values the subsidiary at $477.5 million.
The company plans to utilize the funds behind acceleration of product development of its online/mobile education ecosystem base and to strengthen its ‘first-mover advantage’ that aims to disrupt the online education space in China that is directed to the requirements of students, teachers and parents, writes Catherine Shu of Tech Crunch.
The online education platform is available via websites and mobile apps and was initiated in January 2014 as a joint venture between NetDragon, private equity firm Vision Knight Capital, and Foxteq, a hardware manufacturer that is owned by OEM giant Foxconn. NetDragon itself was founded in 1999 as a member of the Hong Kong Stock Exchange.
Dejian Liu, CEO and executive director of NetDragon, released a statement affirming his company’s competitive advantage due to its existing infrastructure.
“We believe the education industry is ripe for a major change. There is a strong and ever-growing need for a mobile educational platform that creates true educational value and makes people want to come back to learn more. We at NetDragon are fortunate to be in a very unique position to build such a product with our proven world-class mobile internet and gaming expertise, large-scale technology resources and team infrastructure that we have built out of scaling several successful businesses over the many years since our inception.”
He also expressed his delight on receiving the funding from his investors.
“We are excited to have the opportunity to work with these excellent partners as we continue to intensify our effort to develop the best educational products that truly changes peoples’ lives. Both IDG and Vertex are amongst the most successful global venture capital investors in the mobile internet space, and their investment is a strong vote of confidence in our vision and execution capabilities. Alpha Animation is one of the leading and most influential animation content production companies in China, and we believe their support as a strategic investor will create valuable synergies in the areas of content and branding that will greatly enhance our educational offerings.”
Online education is rapidly growing in China, despite its deep underlying appreciation for traditional Chinese educational institutions. Around seven million students within the country have entered into university in September. The platform seeks to equip students with extra preparation for college entry exams and provides various pedagogies created from a combination of those followed by universities and other traditional schools.
Tay Choon Chong, Managing Director and Chief Investment Officer, Vertex Venture also recognized the need of education to one’s development and its importance in “improving one’s quality of life”.
The trend has also progressed outside Asia, with online education startups such as Australian based Myndlyte aiming to expand its reach to Southeast Asia, China and India through its School of Music Online program that aims to add gamification to the experience of learning an instrument, writes Michael de Waal-Montgomery of e27 News.