ADV backs China postgraduate, vocational training specialist

The company raised $100 million in Series D funding led by ADV in January, according to Index Capital, which served as exclusive financial advisor on the transaction. A source close to ADV said that its investment was structured across a series of tranches, the last of which closed in April.

The private equity firm – currently deploying its second fund, which has a corpus of $637 million – claims to work with entrepreneurs and management teams across the region to provide bespoke financing solutions. Target companies often require capital to resolve corporate and shareholder dislocations in addition to supporting growth.

Universal Education closed its Series C round in 2014 with RMB100 million ($16 million) in commitments. The round was led by Chinese search giant Baidu and featured Hao Capital and DCM. The company's $16 million Series B, which closed three years earlier, was provided by DCM, Sequoia Capital China, Legend Capital, and F&H Fund Management. The round before that, which closed in 2008, the year the company was founded, saw Sequoia and Legend put in $10 million.

Universal Education's services cover career planning and postgraduate training across a range of subjects, including preparation for both levels of the College English Test. It claims to offer artificial intelligence-based learning modules that address the needs of individual students. On the vocational training side, the company targets individuals pursuing professional qualifications in industries such as banking, education, and civil service.

According to Rui Zhang, Universal Education's chairman, more than 50% of China's tier-one universities have adopted the company's vocational training solutions. "Although we believe we have achieved both technology leadership and market dominance within the postgraduate exam training vertical, we believe our work has just begun," he added.

ADV expects to see robust growth in both segments of Universal Education's business. The firm said in a statement that China's postgraduate tuition market has been expanding at a double-digit pace, driven by expanding undergraduate enrolment and undergraduates increasingly recognizing the importance of postgraduate qualifications in a competitive job market.

"Universal Education is a clear market leader in China's fast-growing postgraduate admission training market, with a technology-driven business model providing high-quality learning solutions to its students. We believe that our capital and ongoing support will assist the company in its goal to build a world-class education solution platform, and to broaden its range of products to a larger audience in China," said Jianyi Zhu, a managing partner at ADV.

Most private equity investment in China's online education space has focused on K-12 after-school services. However, vocational training is seen as an attractive and relatively underdeveloped niche. Recent activity in this area includes a $20 million Series C round for 51CTO, a technology training specialist, and a RMB130 million Series B for Sanjieke, which also primarily targets IT professionals.

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• Topics
• Greater China
• Technology
• Consumer
• Expansion
• China
• Education
• Growth capital
• ADV Partners