IDG Capital co-leads $390m round of Chinese vocational edtech startup

Chinese education tech startup Fenbi Education announced that it has secured US$390 million in a series A round led by IDG Capital and Trustbridge Partners.

China Renaissance-backed Huaxing Growth Capital also participated in the fundraise.

Photo credit: Moti Capital

Founded in 2015, Fenbi Education focuses on providing vocational education online and offline. Its users include people preparing for the civil service entrance test, teachers’ qualification certificate, and postgraduate exam, among others.

The company says it has the biggest market share of the adults vocational education industry. Fenbi adds that as of January, it had accumulated 48 million registered users and 7 million premium (paid) users since its inception.

Having achieved growth as an online platform, it has been accelerating its development of offline channels since 2020. To date, it has set up over 396 tutoring centers, with 14,000 employees.

The fresh capital will be used to hire talent as well as to develop its products and technology, said Fenbi CEO Zhang Xiaolong.

The Chinese edtech industry is soaring and was estimated to reach US$64 billion in 2020, with users growing by 23% to 331 million people. The market saw companies getting a combined 38.8 billion yuan (US$6 billion) in 89 fundraising deals from January to November last year.

Major edtech players include Tencent-backed Yuanfudao and VIPKid, which counts Alibaba as an investor. TikTok owner ByteDance also has bet on the market by launching its own edtech brand Dali Education last year.

Currency converted from Chinese yuan to US dollar: US$1 = 6.45 yuan.