NetDragon, one of China’s leading mobile and games development companies, has raised $52.5 million in Series A funding for its online education business from investors including IDG Capital, Vertex Venture, and Alpha Animation, an animation studio based in Shenzhen. The round values NetDragon’s online education subsidiary at $477.5 million.
Targeted at students in kindergarten through senior high school, NetDragon’s online education platform is accessible through websites or mobile apps. The subsidiary was launched 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.
Online education is a fast-growing sector in China: overseas companies like Coursera have launched Chinese language platforms, while domestic startups like language-learning platform TutorGroup have raised significant amounts of funding from major tech companies including Alibaba. The demand for online education is driven by students who want extra preparation for college entrance exams, or who are interested in exploring different pedagogies from those followed by universities and other traditional education institutions.
In a prepared statement, NetDragon chairman and executive director Dejian Liu said his company’s online education business has a competitive advantage because of NetDragon’s existing infrastructure, which it developed while building platforms like 17173.com, China’s top online gaming portal, and app store 91 Wireless, which was sold to Internet search giant Baidu for $1.9 billion in July 2013.
“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,” said Liu.