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Airbnb-like Service Xiaozhu Raises $15mn of Series B Funding Led by Legend Capital
Xiaozhu, a Chinese short-term home-rental service, reportedly announced it has secured $15 million of Series B financing led by Legend Capital and followed by existing investor Morningside Ventures, which has poured eight-digit Series A financing in the company in 2012. The capital will be invested in team construction, R&D, branding, said Chen Chi, CEO of the company.
Chen Chi and Wang Liantao, two former execs of Ganji.com, founded Xiaozhu in 2012 after leaving Mayi.com, the vocational rental service backed by classified site Ganji.com earlier the same year. Different from other similar services, Xiaozhu integrates more social elements to the platform. The company claimed to have suites available in more than 160 cities countrywide and have established offices in 13 cities.
Triggered by the success of their U.S. predecessor Airbnb, strings of Chinese room-sharing services mushroomed and received funding during 2012 to 2013. Mayi and Xiaozhu, two avid followers of the Airbnb model, announced $10 million funding respectively in 2013. Tujia got a combined 400 million yuan in Series A and B latter the same year. Other similar local services are Zhuwona and Soufun-backed Youtianxia.
Despite the accolades for Airbnb model from Chinese followers, Chinese room-sharing industry has witnessed some turbulences in the past year and whether the sharing economy model will stand a chance in China is being questioned, given the huge differences in credit systems and hotel pricings in Chinese and the U.S. market. Airizu, one of the earliest entrants in travel rentals in China backed by the notorious Samwer brothers, is found closed last year after two years of operation.
Airbnb itself is also taking more active measures to explore Chinese market after receiving a landmark round of $500 million funding at a valuation of $10 billion this April.
image credit: Xiaozhu