SBI education fund backs China's Tutor Group

The size of SBI's capital commitment was not disclosed, but it comes from the SBI-Fudan Fund, an education-focused vehicle set up with an investment unit of Shanghai's Fudan University. SBI is expected to provide local expertise as TutorGroup continues to expand into new markets across Asia, including Japan.

TutorGroup was set up in Taiwan 10 years ago by brothers Eric Yang and Ming Yang, initially providing English tutorials in classrooms in competition with Wall Street English and EF Education First. The firm soon launched an online platform with a view to entering the mainland market.

J.P. Gan, managing partner at Qiming Venture Partners, told AVCJ last month that he first came across TutorGroup from classified ads in Chinese newspapers and then made a cold call to the founders. Qiming first invested in the company in April 2012, committing $15 million. CyberAgent Ventures invested a few months later.

The Series B round, announced last month, saw Alibaba Group and Temasek Holdings participate alongside Qiming. Alibaba is said to have covered about half of the entire round. There have already been discussions with Alibaba on potential collaborative efforts, while Temasek is expected to support expansion in Southeast Asia.

TutorGroup offers tuition services to adults through its TutorABC and VIPABC platforms, as well as a separate service for school-age students. It expects the adult English language-learning market will grow at 25% per year through 2016, when it will be worth more than $21 billion.

Supported by an R&D team in Silicon Valley, TutorGroup provides real-time language learning through online class sessions in 30 countries with more than 2,000 tutors to date. The firm is also looking beyond English tuition, having recently launched TutorMing, aimed at foreign students learning Mandarin Chinese.

"TutorGroup is premiere Internet technology platform," said Peilung Li, chairman of SBI China, said in a statement. "Its highly-integrated technological platform enables unlimited imagination for diversified and explosive growth of its business in the future. We are keen to help them capitalize on our experience and influence within the Internet financial sector to help TutorGroup strengthen its existing platform, develop new business and accelerate its expansion in Asia and around the world."

SBI announced the launch of two venture capital funds - one US dollar-denominated and the other renminbi-denominated - in cooperation with Fudan in 2010. Two years earlier, the Japanese financial group formed joint venture funds with investment units of Beijing University Group and Tsinghua University Group, respectively.

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• Topics
• Greater China
• Consumer
• Venture
• Technology
• Education
• TMT
• China
• SBI Holdings
• Qiming Venture Partners
• Temasek Holdings
• Alibaba Group