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China / Education

Online education platform starts them young

By Luo Wangshu (chinadaily.com.cn) Updated: 2015-04-02 11:00

Even as higher education goes increasingly online in the global market, many investors in China are banking on the K-12 segment.

In February, 17zuoye.com, an online learning platform focusing on afterschool assignments at the K-12 stage, received $100 million in a fourth round of financing. The company's estimated value has reached $600 million.

Investors include venture capital giants H Capital, Temasek, Digital Sky Technologies and Shunwei Capital Partners, which invested in groups including Alibaba, New Oriental group, Facebook and Twitter.

Tuck Lye Koh, founding partner and CEO of Shunwei Capital Partners, believes online education has a promising market in China.

"Traditional Chinese education companies were listed from 2006 to 2010 … and I hope online education companies will be listed in five years," he said.

"The high estimated value of online education companies and huge sum of investment indicate that online education is heating up in China," said angel investor Wang Qiang, who is also the chairman of 17zuoye.com.

"Investments in online education in China began to boom last year," said Xu Xiaoping, another angel investor and the founding partner of ZhenFund.com.

Former Harvard University president Larry Summers joined Minerva, an online university based in San Francisco, and former Yale University president Richard C. Levin became the chief executive of Coursera, a California-based online education provider. The moves showed that US top higher education administrators have faith in online education's future, Xu said, adding that investors in the US have seen the potential of online education since 2013, and the market is booming.

According to an online education report released in November by the TAL Education Group, one of China's largest K-12 after-school tutor providers, a total of $910 million has been invested in China's online education sector since 2013, and $470 million were invested from May 2014.

iResearch, a Beijing-based Internet industry consultancy, estimated that the value of China's online education market will reach nearly 120 billion yuan ($20 billion) in 2015.

The central government raised the "Internet plus" concept in March 2015 during its work report, encouraging traditional industries to take advantage of the Internet to better serve people's needs.

The Ministry of Education said in its 2014 plan that it encourages schools to focus more on online courses.

17zuoye, which means "doing homework together in Chinese", was established in 2011. It has 12 million users now.

As of March 5, a total of 31 provinces, 46,001 primary schools, 601,222 teachers and 11,738,254 students have been registered with the website.

"The ultimate goal of education is to lead children to a bright and happy future," chairman Wang said, adding that the website aims to provide equal opportunities for all children.

"Chinese children spend about two hours a day on homework on average … the large sum and lack of diversity of these assignments have been widely criticized; 17zuoye helps address the shortfalls of the traditional homework model. It allows students to interact and teachers to adjust to the process. Parents can also monitor it," said Liu Chang, founder of the company.

Similar afterschool project providers in the US envy his group because Chinese parents pay a great deal of attention to children's homework, Liu said, adding that that culture is the soil nurturing the success of 17zuoye.

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