AVCJ

Chinese network service provider receives $35.6m led by Legend Capital

  • Larissa Ku
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AgotoZ, a Chinese network-as-a-service (NaaS) provider, has raised RMB250 million ($35.6 million) in an extended Series B led by Legend Capital. Existing investors SIG China and Northern Light Venture Capital re-upped.

Northern Light led a Series A and the first tranche of the Series B respectively in January and July 2018, respectively. The Series B was worth RMB100 million, according to AVCJ research.

Founded in 2017, the company provides high-speed network connectivity services for enterprise customers. It focuses on SD-WAN technology or software-defined networking in a wide area network (WAN). This simplifies networks by separating the hardware from the control mechanism, effectively offering a lower cost proposition to more expensive private WAN technologies.

IDC claims the SD-WAN market is growing at an annual rate of 69% and will reach $8 billion in 2020. Gartner estimates that by 2023 more than 90% of WAN edge infrastructure refresh initiatives will be based on SD-WAN appliances.

SD-WAN has gained traction against a backdrop of increased demand for enterprise cloud services. The technology makes it easier for companies to connect to the cloud; AgotoZ claims that enterprise customers can save as much as half their network fee by using SD-WAN.

NaaS providers are also expected to benefit from 5G. Zheng Li, CEO of AgotoZ, said that the proceeds of the new funding round will go towards research into 5G applications.

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