After social, e-commerce, group-buying and the like, venture capitalists have new categories of tech startups to chase in China in 2013. The new are online education, online finance, travel, among others. Mobile, of course, counts. The venture-backed mobile businesses, however, are similar to those proven ones on desktop; for instance, gaming, advertising, solutions for developers or enterprises.
While that big Chinese Internet companies poured massive money into acquisitions and investments this year is more for complementing their core businesses or strategies, venture capitalists are for new markets or games changers.
Education
It is expected there is a revolution in education underway in China — moving to private education and online. A wave of education startups raised fundings in the first half of 2013. Some of them, such as 51Talk raised another round later in the year.
As currently the good education Chinese, especially Chinese young parents, perceive is pretty much about good schools, from kindergarten to universities overseas, the business opportunities entrepreneurs see are in K-12 and preparing kids for studying abroad. Gong Haiyan, founder of dating site Jiayuan, decided to enter the education market starting with an online English-learning site but shifting to a K-12 e-learning platform.
Others that have been funded include education app developers and western models of online education. As to online teaching platforms, it is widely recognized that it’s giants’ game as both Alibaba and Tencent have launched theirs in this year. YY, the online video/voice communication service, has been operating one.
Finance
Venture capital firms like Sequoia China and IDG Capital Partners laid eyes on Internet-based finance from early on. In 2013, VCs showed interest in personal finance app (Wacai, Tongbanjie), credit card management app (Kaniu, 51zhangdan), online financial product aggregation & search (Rong360, 91jinrong), financial social media (Snowball Finance), among others.
If you count Bitcoin as currency — Chinese central bank doesn’t think so, here’s another case in this category. Bitcoin trading platform BTC China raised $5 million recently.
Mobile
Mobile app developer-facing services pocketed a lot of funding this year that include mobile data analysis (TalkingData raised Series A while its direct competitor Umeng was acquired by Alibaba), mobile advertising (Youmi announced RMB100 million financing), mobile app security (Bangcle raised Series B), SDK/API developers (social sharing SDK seveloper ShareSDK, voice recognition service Yunzhisheng, Face recognition solution Face++, indoor map Palmap+), mobile payment (mobile game payment service Mo9), among others.
As it turned out it’s not that difficult to make money from mobile games, it’s no wonder there were so many acquisitions and investments in this sector. Mobile game developer Chukong raised $50 million in Series D; Game publisher Yodo1 raised $11 million in Series B; HTML5 game developer UZwan received Series A; Ejoy secured 100 million Yuan financing; Mobile social game developer Hortor Soft raised Series A.
Crazy buys in both mobile gaming and Web-based gaming include that Zhongqingbao acquired stakes in two mobile game companies for 440 million Yuan; Alpha Animation acquired 51 Pocket, and 5agame with 692 million Yuan; Ourpalm acquired Playcrab and Shanggame for 2.55 billion yuan, and web game developer Dovo;
Travel
It is believed that there’s still a big room in travel market in China and for outbound travel. Startups that have received funds in 2013 include B2B tourism service( 8trip), outbound tourism service (Shijiebang), social travel service (Mafengwo) , travel guide service (Tuniu), hotel app (Economy Hotel Manager).
Online to Offline/Lifestyle Services
Funded startups in this category are working on housekeeping (Ayibang), online food ordering (Etaoshi,Ele.me), food delivery (Daojia), movie ticket/ratings &reviews (Gewara, Mtime), pet raising (Petta), wedding (591wed), maternal and child health (Spice Moms).
Yes, there are many investments in taxi app and car rental, thanks to the global expansion of Uber. Also some Airbnb-style services are not dying in China but evolving with new funding (Mayi, Tujia).
What will be hot in 2014? Some venture capitalists thought of enterprise-facing services and have taken action (enterprise social service Mingdao and software provider Facishare have raised funding in 2013)
