Venture Capital Deals Of The Week: Tencent Bets On Online Education

by: VCDeals

Welcome to Seeking Alpha’s Venture Capital Deals of the Week. Follow this account and turn on the e-mail alert to receive VCDeals in your inbox on Saturday mornings.

Chinese online education: Tencent (OTCPK:TCEHY, OTCPK:TCTZF) co-led in a $500M Series D+ round in Chinese K-12 online education platform Vipkid. The other leaders were Coatue Management, Sequoia Capital China, and Yunfeng Capital. Total funding now stands at $825M. Vipkid sadi the round brought its valuation up to $3B.

Vipkid offers one-on-one video tutoring sessions for Chinese children from 5 to 12 years old, who are matched with North America-based language teachers. The service has over 40K teachers and over 300K paid students from 35 regions and countries. The company will use the new funding to hire more teachers, improve tech, and globalization.

Competition: The online education space in China is growing and varied with the likes of math education-focused, Sequoia Capital-backed Huohua Siwei, coding platform Codemao (CMB International Capital backing), and Knowbox, backed by Yunfeng Capital.

Cybersecurity: Alphabet’s (GOOG, GOOGL) CapitalG participated in a $200M round in cybersecurity company CrowdStrike. General Atlantic, Accel, and IVP led the round with participation by March Capital. The round gave CrowdStrike over $480M in total funding and a valuation of over $3B.

CrowdStrike provides next-gen threat intelligence and incident response using cloud-based endpoint protection. The system monitors laptops and mobile devices connected to a client’s network. CrowdStrike was the cybersecurity company that investigated the Democratic National Committee hack during the 2016 presidential campaign and traced the hack to Russia.

Competition: Symantec (NASDAQ:SYMC), Microsoft (NASDAQ:MSFT), and Carbon Black (NASDAQ:CBLK).

Hearing loss treatment: GV and Regeneron Pharmaceuticals (NASDAQ:REGN) participated in a $55M Series C round for Decibel Therapeutics, which focuses on the discovery and development of hearing loss treatments. Other backers included Third Rock Ventures, Foresite Capital, and Bessemer Venture Partners. GV Venture Partner Anthony Philippakis will join the board.

Decibel Therapeutics focuses on drug discovery, development, and a translational research platform to discover therapeutics that can protect, repair, and restore hearing loss. The company plans to use the round to advance preclinical and clinical product candidates.

Open source web server: Goldman Sachs (NYSE:GS) Growth Equity led a $43M Series C round in Nginx, the startup behind the open source web server. Goldman’s David Capital, managing director of the Merchant Banking Division, will join the Nginx board. NEA also participated in the round, which brought total funding up to $103M.

Nginx’s open source server runs 400M established websites and the commercial side of the business has 1.5K paying customers to access premium features including load balancing and analytics. Nginx plans to continue building out its commercial product and add to its international presence and partners ecosystem.

Competition: The open source Apache is Nginx’s biggest competitor.

Push notifications: Intel (NASDAQ:INTC) Capital and Verizon (NYSE:VZ) Ventures participated in a $25M Series F round in push notification platform Urban Airship. Foundry Group led the round with participation from True Ventures, August Capital, QuestMark Partners, and Franklin Park Associates. Total funding is now over $100M.

Urban Airship marketing channels have expanded to include email, SMS, voice assistants, and mobile wallets. Urban Airship says it has delivered more than 2T messages, double the total a year ago. Enterprise customers include AMC, Royal Automobile Club, and Magazine Luiza.

Enterprise video software: Morgan Stanley (NYSE:MS) Expansion Capital led a $20M round in enterprise video software company Vbrick. Acme Nova and Adams Capital also participated.

Vbrick’s platform allows its Fortune 500 customers to stream and record webcasts, connect with global employees, and consolidate recordings into a single system for easy access and sharing. The company says it has added over 300 customers since its 2015 launch and grew annual subscription rates by 100%. The new funding will go towards expanding sales and marketing efforts and the partner ecosystem.

Editor's Note: This article discusses one or more securities that do not trade on a major U.S. exchange. Please be aware of the risks associated with these stocks.