Chinese education firm VIPKid closes Tencent-led Series E round

Source: VIPKid LinkedIn

Beijing-based online education platform VIPKid on Tuesday announced the completion of a Series E round of financing led by Tencent Holdings.

Financial terms of the new round were not disclosed. According to previous media reports, VIPKid was targeting to raise as much as $500 million in the round and eyeing a valuation of $4.5 billion, up from $3.5 billion in 2018.

VIPKid did not immediately respond to DealStreetAsia’s email seeking comments.

In a statement on its WeChat account, the education firm said the two companies will continue to deepen cooperation in the fields of internet education, artificial intelligence (AI), cloud services, and charitable education.

This is the third investment by Tencent into VIPKid. The Chinese tech major had earlier participated in the startup’s $500 million Series D+ round in June 2018 and a $200 million Series D round in August 2017.

There had been conflicting reports about Tencent’s decision to invest in VIPKid. In late August, Reuters had reported that Tencent had scrapped plans to invest about $150 million in VIPKid after Beijing tightened regulations on online education platforms in July, stipulating teachers hold valid teaching qualifications and the firms publicise information such as foreign teachers’ certificates and work experience.

In September, the Wall Street Journal said that Tencent was pushing to close the investment despite concerns among current and prospective investors over VIPKid’s business model.

VIPKid, founded in October 2013, is backed by investors including Sequoia Capital China and retired basketball star Kobe Bryant. The company has connected over 700,000 children, aged between four and 15 and living primarily in China, with more than 90,000 native English-speaking teachers in the United States and Canada for live video lessons as of August 2019, according to its statement.

“With the support of more talent, technologies and capital, VIPKid will provide more opportunities for every child to access customized education services and grow global competitiveness,” said Mi Wenjuan, founder and CEO of VIPKid.

The online education platform said it will increase investments in educational content, talent recruitment and technology to enhance operational efficiency to provide better products and services to students and their parents.

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Singapore Reporter/s

In Singapore, we are looking to double our reporting team by this year-end to comprehensively cover the fast-moving world of funded startups and VC, PE & M&A deals. We want reporters who can tell our readers what is really happening in these sectors and why it matters to markets, companies and consumers. The ability to write precisely and urgently is crucial for these roles. Ideal candidates must have to ability to work in a collaborative, dynamic, and fast-changing environment. We want our new hires to be digitally savvy and ready to experiment with new forms of storytelling. Most importantly, we are looking for hard-hitting reporters who work well in a team. Collaboration and collegiality are a must.

Following vacancies can be applied for (only in Singapore).

Following vacancies can be applied for (only in Singapore).   

  • A reporter to track companies/startups that have raised private capital, and have the potential to become unicorns. SEA currently has over 40 companies with a valuation of over $100 million and under $1 billion.
  • A reporter who can get behind the scenes and reveal how funding rounds are put together, or why they’ve failed to materialise. She/he in this role will largely focus on long-format stories. 
  • A journalist to track special situations funds, distressed debt and private credit (from the PE angle) across Asia.