Enterprise software developer Fxiaoke announced an undisclosed amount of Series E funding led by CITIC Private Equity on Monday. The company is hoping to boost user acquisition after coming into direct competition with Alibaba-backed DingTalk. Current investors Hillhouse Capital, DCM, Northern Light Venture Capital and IDG also participated.

The new round came just 10 months after a 100 million USD D round in September last year. The previous three rounds of financing totaled over 60 million USD.

Fxiaoke has been reforming their core product for some time. Beginning as a Yammer-like enterprise social network in December 2011, the startup turned to a Salesforce model before shifting to a customer relationship management (CRM) platform. Together with the funding news, Fxiaoke announced that they are going to rebrand as a mobile team collaboration platform.

After a failed attempt to challenge Tencent’s Wechat with Laiwang in the individual communication field, Alibaba spotted an opening in the  enterprise mobile chat space, launching DingTalk.

Alibaba’s support in funding and technology enabled DingTalk to expand quickly since its launch in May 2015. The product claimed over 300,000 enterprise customers covering 100 industries as of October last year, according to the company.

In order to fend off the tough competition from DingTalk, Fxiaoke launched a free version in October last year. Luo Xu, the company CEO, admitted that DingTalk’s entry forced them to do so ahead of schedule, and the decision has slashed a great proportion of their Q4 revenue. Fxiaoke claims to have amassed over 300,000 business customers, while the number of active users surged more than 10 times compared with the same period last year.

The competition in China’s SME-focused collaboration and messaging service industry is heating up, with several new leading players like Yammer-like service Mingdao and Teambition also entering the space.

Image credit: Fxiaoke

Emma Lee is Shanghai-based tech writer, covering startups and tech happenings in China and Asia in general. We are looking for stories related to tech and China. Reach her at lixin@technode.com.

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