SoftBank to invest in Baidu education spin-off
SoftBank Vision Fund is reportedly in talks with Chinese education startup Zuoyebang, founded by Baidu in 2014 and spun off in 2015, to invest US$500mn in the growing sector
The startup’s app, aimed at primary and secondary school children in China, allows users to upload homework questions and answers, pay for one-to-one tuition from a partnered teacher, and view online courses and livestreams.
Bloomberg reported that the app already has 300mn registered users, and added that Deloitte projects China’s education market to reach $422bn by 2020.
An investment in Zuoyebang would give Japan’s SoftBank a foothold in this growing market, with the startup holding the potential to become one of China’s major online education providers.
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The SoftBank Vision Fund is the largest technology investor in the world, according to China Money Network, with a pool of almost $100bn.
Chinese firms have seen particular interest from SoftBank Vision Fund, with significant financing already applied to ride hailing startup DiDi Chuxing, food delivery firm Ele.me, and online insurance company ZhongAn Online P&C Insurance Co.
In July, Zuoyebang raised $350mn in a Series D funding round led by Coatue Management, with investors including Goldman Sachs and Sequoia Capital China. It raised $25mn, $60mn, and $150mn in its respective A, B, and C funding rounds, meaning SoftBank’s potential investment would push total funding beyond the $1bn mark.