Every month we handpick 40 financing cases that reveal the hottest trends in China’s startup and tech industry.
Ride-hailing and bike-sharing led the tech investment trends in China last month, followed by cloud services. As cloud services climbed back to the top this month, other highlights also included the unmanned retail and ed-tech sectors. At this stage, tech giants such as Tencent and Alibaba are competing the cloud service market in China and also overseas. Since these platforms have earned the opportunity to connect their platforms to various services and products, they can have access to data and user preferences at the same time–a cycle that is guaranteed to promote their cloud services as well as facilitate other industries.
Top 3 investment cases
Among the 40 cases we reported on this month, Kingsoft Cloud, Bianligou, and DaDaABC secured the highest funding. China’s leading cloud service provider, Kingsoft Cloud, secured two financing rounds this month, amounting to a total of USD 420 million for Series D+, which positions them to gain a larger market share. Kingsoft Cloud is working hard to provide AI solutions for more industries, such as public services, financial, medical, and others. Meanwhile, over the past three years, Kingsoft Cloud has won bright grades, which keeps its average annual growth rate upwards of 100%. That is also the reason why it is gathering capital.
Bianligou raised USD 200 million for its Series A and Series B financing rounds. Tencent led its Series A financing round with USD 53 million, with Genesis Capital and KTB participating; and CDH Investments led Bianligou’s Series B financing round, which amounted to USD 144 million. The participating investors included Northern Light Venture Capital, Qiming Venture Partners, and so on. Bianligou’s unmanned retail business focuses on deploying unmanned shelves in office buildings. With the support of investors, Bianligou is speeding up its market expansions in China to cover 60 cities with over 500,000 unmanned retail terminals.
Though some unmanned retail startups were shut down in recent months due to their lack of cash flow or fierce competition, enterprises in the unmanned retail field find it difficult to grab capital and spread their business as easily as they could before. But there are also some existing players, which have already occupied parts of the market, who are forming their threshold. Those enterprises are more likely to secure funding for development in the future. Bianligou is a representative of those existing players.
Moreover, ed-tech continues its popularity in the tech investment scene, which is also a new platform for maneuvering AI technology, big data analysis, as well as other advanced technology, in order to meet the high quality demand, as well as customized education. Online English education startup, DaDaABC, secured USD 100 million in funding from Tiger Global, and an ed-tech firm, Tomorrow Advancing Life. DaDaABC aims to build an online school for high quality English education, and apply AI technology to improve its teaching service, as well as to develop more educational products.
Cloud service provider Kingsoft Cloud secured USD 420M for Series D+
Kingsoft Cloud is a cloud service provider that mainly provides online cloud storage and cloud distribution services for businesses and developers. Its commercial version is based on the fast disk Jinshan cloud services architecture, business-oriented cloud storage products, storage, and so on. Its cloud services and products support access by large-scale concurrent users and ensure the security of those users’ data.
Founded in 2012 in Beijing and relying on Jinshan’s 20 years of deep technical accumulation, its fast disk, Personal Edition, has over 40 million users, and has been widely adopted in smartphones, TVs, and other such technology.
Unmanned retail startup Bianligou received USD 200M for Series A & Series B
Bianligou is incubated by the fresh food e-commerce app, operator Missfresh, which focuses on refrigerated containers for fresh-foods to complement room temperature snack-shelves.
The service was launched in June, and has set up nearly 2,000 shelves in Beijing, nearly covering all office building areas across the city. Their daily average sales volume per sale point is more than RMB 200.
Online English education startup DaDaABC secured USD 100M for Series C
DaDaABC is an online English education startup which provides one-to-one online English teaching for children between the ages of 4 and 16. The startup recruits English teachers from foreign countries whose native language is English. The startup then bridges English teachers and students based on students’ unique characteristics. During the courses of a specific season, teachers-student partnerships are fixed.
3 investors to watch
Hundreds of investors joined in the aforementioned investment cases. Eyeing the hottest sectors were major investors like Legend Star, SDIC and CMIG.
Legend Star, founded in 2008, currently manages five angel investment funds totaling approximately RMB 2.5 billion, and has invested in nearly 200 startups.
As one of Legend Holdings’ early investments and incubations, Legend Star has been dedicated to ventures for over three decades, through which it has provided entrepreneurs with a featured service package of “angel investment and in-depth incubation.”
Legend Star’s angel investment focuses on artificial intelligence, TMT, and health care investment, especially in such cutting-edge fields as intelligent machines, Internet plus traditional industries, biological technologies, as well as medical apparatuses and instruments.
It also manages and operates a “CEO Training Program,” through which it offers entrepreneurs professional startup training for free. In addition, the “Legend Star Union” provides services and shares resources for entrepreneurs, helps enterprises’ fast growth, and creates Legend Star’s business ecosystem.
This month, Legend Star participated in PANDAINS’s Series A+ financing round with USD 8 million. PANDAINS is an online vehicle insurance service platform, which plans to strengthen its development of vehicle related financial products, and recruit more talent for business development.
Established on May 5, 1995, State Development & Investment Corp.,Ltd. (SDIC) is a state-owned investment holding company approved by the state council.
Since its establishment, SDIC has been focusing on four strategic business sectors, namely infrastructure-related industries, emerging industries, financial services, as well as international business.
After 20 years of exploration and endeavors, SDIC has gradually developed a mode of operation featuring equity investment, equity management, equity operation, and a combination of asset operation and capital operation. Specifically, it is focused on obtaining equity through investment, increasing the value of invested-in enterprises through equity management, and gaining profits through equity transfer or equity operation. Eventually, the value of state-owned assets are maintained or increased.
SDIC led medical imaging startup Eimageglobal’s Series D financing this month. The funding involved in this round amounted to USD 15 million. Eimageglobal provides hospitals and medical organizations with medical imaging technology support, and will use the funds to develop a cloud platform to facilitate its medical imaging services.
China Minsheng Investment Group (CMIG) is a global investment group in China which is committed to responsible investment. CMIG focuses on emerging sectors closely tied to people’s livelihoods and actively promotes industrial upgrading and economic transformation.
CMIG was founded by 59 leading private companies on Aug. 21, 2014 with registered capital of 50 billion yuan.
Since its inception, CMIG has invested heavily in the development of alternative energy, in-home care services, prefabricated construction, and general aviation while simultaneously promoting ‘green’ environmentally friendly businesses that make a difference in people’s lives. Besides that, it also endeavors to serve the economy through our insurance, financial leasing, asset management, and inclusive finance businesses and other leading financial services.
CMIG joined co-working space Kr Space’s Series Pre B financing round this month, which aims to expand its co-working spaces in first-tier cities in China to provide enhanced enterprise services by improving operational efficiency.
This month, the cloud services and unmanned retail led the investment trends in China.
Cloud services is a necessary infrastructure for most enterprises operating today; not only for tech companies, but also other firms from traditional industries. With the help of cloud services, enterprises can ensure high efficient operation and management within the enterprise, as well as provide users with better services once the cloud services are integrated with big data analysis and AI (Artificial Intelligence) technology. Moreover, even governments are connecting to cloud platforms to enhance their public services. Because of this, there is a huge gap between demands from enterprises for cloud services and offers from cloud service providers. We can expect more players in the cloud service industry and the participation of more venture capital firms.
Startups in the unmanned retail industry have come on hard times recently. While some of them are moving towards incorporating, being acquired, or even shutting down, others among them with competitive advantages will continue to expand their market influence since the market is not yet saturated. Unmanned retail is in line to follow the trend of “New Retail,” which covers most of our consumption scenarios. It will go on to provide opportunity for startups with competitive advantages.
List of companies that attracted investments in January:
(Top photo from 699pic.com)