China travel sites Woqu, Lulutrip merge, raise $25m
Chinese outbound online travel platforms Woqu.com and Lulutrip – both of which have received several rounds of funding from VC and strategic investors – have agreed to merge. The combined entity has received $25 million in new funding.
The round for the new entity, namely Woxing Group, is led by Yuantai Changqing Fund, with participation from Lightspeed China Partners and E Garden Ventures. The new capital will be used to consolidate Woxing's leading position in the outbound travel market, as well as to improve its IT systems and customer services, the company told local media.
Launched in 2013, Woqu.com provides travel packages and car rental services for Chinese tourists visiting the US. Its services currently cover 400 destinations in 56 countries, with more than 300,000 tourists using its online receives. The company previously received a Series A of less than $10 million from Morningside Venture Capital and a $20 million Series B round from Tencent Holdings and Morningside in 2014.
Lulutrip was founded in 2007 with offices in Silicon Valley and Shanghai. Similar to Woqu.com, it provides an online platform for Chinese-speaking visitors to book tours and activities in North America and Europe. The company has also formed partnerships with local travel agencies and helps travelers develop customized itineraries, serving about 500,000 customers. It received an undisclosed amount of funding from Lightspeed China in 2014.
As consumer technology in China matures - reflected by slowing smart phone sales growth as penetration rates in most cities are now relatively high - more start-ups are expected to join forces in order to increase user numbers and revenue, and eliminate costly battles for market share.
Last year, Chinese online shopping and social networking platform Mogujie agreed to take control of rival Meilishuo.com in a stock-swap deal. Rival Chinese online-to-offline (O2O) services platforms Dianping and Meituan also agreed to merge. This followed the unification of ride-hailing app operators Didi Dache and Kuaidi Dache. The merged entity, Didi Chuxing, then acquire Uber's local operation.
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