A sub-brand of Chinese online education platform VipKid has secured USD 80 million in fundraising led by Sequoia Capital and internet giant Tencent Holdings, indicating that tech-enabled education remains a hot investment sector in the country.
Dami Wangxiao, which translates into Rice eSchool, aims to offer live-streamed English and maths courses to primary students in China, the company announced on Monday as it revealed the completion of the Series A funding round.
Having started as an incubated project nearly two years ago, the brand is designed to provide more cost-effective education by enabling bigger class sizes, with students signing up for online sessions in addition to private instruction.
Founded in 2013, VipKid is one of the country’s largest online education platforms and has signed up over 700,000 students. The company started off with online one-on-one English instruction, matching Chinese learners with US- and Canada-based teachers.
Known for its often aggressive parenting style and crop of tiger moms, China has taken a lead in online education, using some of the latest technologies such as artificial intelligence and virtual reality to improve education quality and efficiency. The country’s online education market is expected to reach RMB 380.7 billion (USD 54.7 billion) this year, from RMB 251.7 billion in 2018, according to consultancy firm iResearch.
Still, the boom has attracted increasing competition from some of the country’s biggest tech companies including ByteDance, whose Gogokid platform brings English-speaking teachers into virtual classrooms in China.
In online English education, VipKid also competes with New York-listed 51 Talk and DadaABC, a local rival backed by Tiger Global Management, among others.
Courses under the new VipKid brand aim to create an “immersive” learning experience through live-streaming and help specifically to train students in English speaking and listening and maths thinking, according to the statement.
In October, the Beijing-based start-up announced the completion of a Series E round led by Tencent. Both companies declined to specify the investment amount.
Yu Haiyang, managing director of Tencent Investment, expects Dami to be in a strong position to meet increased demand from Chinese parents for online education, according to the statement.
This article first appeared on the South China Morning Post.