Alibaba Group Holdings and Tiger Global Management have led a $1.6 billion investment in an online education startup called Zuoyebang, in a sign that the COVID-19 crisis is changing the distance learning market into a fiery business.
This round of investments comes months after the platform raised nearly $750 million in June, and the list of investors in the platform includes big names such as Goldman Sachs and GGV Capital, as investor interest in this field increased this year in conjunction with students heading to e-learning amidst school closures due to the epidemic, and the size of the remotely learning market in China is expected to reach 315 billion yuan (equivalent to 48 billion dollars) in 2020, that is, its value will triple over the past five years.
The 5-year-old start-up platform Zuoyebang provides live lessons and remotely learning services to more than 170 million monthly active users across the country.
According to the platform’s statements, there are about 50 million students using the platform daily, equivalent to the population of Spain, and analysts expect that the new investment campaign will help the platform to compete with its giant opponent in this field, Yuanfudao platform.
Zuoyebang, backed by Tencent Holdings and Hillhouse Capital, added that its estimated value reached $15.5 billion after closing two investment rounds of $2.2 billion, and according to statistics, Chinese startups specializing in distance learning attracted investments worth at least 47.6 billion yuan during the current year until date of December 18.