Yuanfudao, a six-year-old startup has attracted a line of big-game investors to back a suite of services, including live courses, a database of exam problems and a popular homework help app.
The company has raised $300 million in a funding round led by China’s largest social networking and gaming company Tencent – Yuanfudao’s existing investor. Other participants included Warburg Pincus, Matrix Partners China, and IDG Capital. Yuanfudao’s valuation raised to $3 billion from $1 billion, post the fresh injection.
Beijing-based online tutoring firm Yuanfudao has capitalized on the immense importance of academic exams for Chinese students. Its popular homework help app scans homework problems and solves them instantly with the snap of a camera. The startup also operates a research institute for AI, which could train its homework app to be smarter.
Yuanfudao became China’s first online K-12 tutoring service provider to achieve a $1 billion valuation last year. It also claims to be the largest online live course platform catering to primary and secondary school students in China.
Yuanfudao is not alone in the heated race to fight for Chinese students and parents. Other companies with similar homework help services are Zuoyebang backed by Baidu, and Yiqizuoye backed by Temasek – a holding company owned by the Government of Singapore. And with a focus on adult education, Chinese companies like New Oriental and 51Talk have also come into the K-12 fray. Both these companies are listed on the New York Stock Exchange.