Vision Plus, CYTS lead round for China hotel marketing player

Other investors include Axiom Asia, Sequoia Capital China, Shunwei Capital and Shanghai-based Qijing Investment. CYTS Hongqi is a tourism-focused investment vehicle launched by IDG Capital, Sequoia Capital China, and local tour operator China CYTS.

Zhiketong completed its Series C round last year with RMB300 million ($42.5 million) in commitments across three tranches. Sequoia led the first tranche, with re-ups from IDG Capital, Shunwei Capital and Lightspeed China Partners; Vision Plus Capital led the second tranche with participation from Sequoia; and CYTS Hongqi led the third.

While hospitality and tourism globally have been devastated by COVID-19, China is seeing a recovery. Zhiketong claims to have more than 17,000 partners, covering 85% of the country's five-star hotels. The combined monthly transaction volume for these partners through the Zhiketong channel exceeds RMB700 million ($105 million). In August, it was RMB400 million. The company's WeChat followers have grown by 100 million in the past year.

Founded in 2014, the company's WeChat platform helps hotels secure bookings from new and existing customers. Payments can be made through WeChat Pay. It takes about 3% of hotel partners' gross merchandise volume (GMV) as a fee. The company also provides a software-as-a-service (SaaS) hotel management product. 

“The pandemic has become a touchstone for testing a business and Zhiketong has demonstrated strong growth this year. With internet traffic costs increasing significantly, it helps hotels establish private traffic pools to retain customers and generate revenue,” said Guodong Wang, an associate partner at Lightspeed, in a statement.

Zhiketong will use the new capital for technology upgrades, increasing repurchase rates, and attracting new customers. It will also support digital transformation by hotels, said CEO Hua Liu.

The company raised more than $10 million for its extended Series A from IDG and Lightspeed in 2017, followed by a Series B in 2018 led by Shunwei. Sequoia led a Series B extension later the same year, which featured all the three existing investors.

A similar business called Honey Guide - or Xiangminiao - was acquired by Weimob in 2018. Weimob, which is backed by Tencent Holdings, GIC Private, and several VC investors, listed in Hong Kong in January 2019. It helps small businesses create an end-to-end online retail presence, primarily through WeChat.

China's hotel direct sales market was worth RMB253 billion in 2019, according to The Chinese Academy of Industry Economy Research.

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• Topics
• Greater China
• Technology
• Expansion
• China
• Shunwei Capital Partners
• Sequoia Capital
• Vision Plus Capital