ByteDance to Pump $170 Million into E-book Reader Zhangyue

Chinese Internet Technology company ByteDance is all set on buying an 11 % stake for $170 Million in Zhangyue, a China-based E-book reader website. The company has already announced officially that one of its subsidiary companies is going to invest in this deal and acquire a significant stake in Zhangyue. The news has been confirmed by E-book reader start-up, Zhangyue. This is a major step by ByteDance to increase its valuation and market brand in various areas, along with its primary revenue factor, Short-videos. The direct investor in the deal here is ByteDance. as per ByteDance 170m series zhangyueliaotechcrunch

ByteDance was founded on 13 March 2012 with its first operation in Internet Industry. It is now majorly famous for its short -video app, TikTok, which is the primary source of its generated revenue. The company was co-founded by Zhang Yiming and Liang Rubo, with its headquarters in Shanghai, China. Zhang Yiming was the CEO of ByteDance starting in 2012. Along with TikTok, the company has launched numerous products, which majorly include Toutiao, a Chinese news platform, and ByteDance AI labs. The first product ever launched by ByteDance was Neihan Duanzi, known for its comedy content, and it was closed down at the order of the Chinese government in 2018.

While Zhangyue was founded in 2008 by Lingyun Zhang, it is located in the Chaoyang district of Beijing, China. The company was started with the motive to provide e-content, audiobooks, and reading facilities to its user. It is not limited to E-books but is expanding its operations faster. The current Chief Executive Officer of Zhangyue is Xiangjun Cheng, and the current valuation after this funding round is approximately 12 Billion Chinese Yuan.

The present funding received Company, ZhangYue, offers multiple literature services to its users, such as E-book reading, magazines, e-novel reading, and listening to audiobooks making its stand very competitive among the market leaders. The application is bringing a revolution in terms of E-books in the country with other leading apps, such as Rakuten Kobo and Tencent Spinoff, which are slightly ahead of Zhangyue.On the other hand, Byte Dance has many services and products offered to its customers. Some significant products are Capcut(a video editing software), TikTok (a short video application where people can show their creativity ), Douyin (It is the Chinese version or name of the internationally famous app TikTok), Toutiao, which is online news providing application which provides information in the form of text as well as video, Xigua Video ( a similar app as TikTok which includes short video making and sharing) and Nuverse, which is a video game company. Apart from the services and products offered, there are three principal subsidiaries of ByteDance: Moonton, Nuverse, and Lark. as per ByteDance 170m series zhangyueliaotechcrunch

After the news of ByteDance acquiring an 11 % stake in ZhangYue came, the question arose about the company’s further plan. With this new acquisition, the company is planning to expand its revenue above 20 million Yuan by the end of 2020. Also, with this deal, Bytedance and ZhangYue have each other assistance in various things such as monetization, revenue, and an increase in the visiting members and users in favor of the alliance. Combined, the deal will increase the overall marketplace of the E-book industry in the country. The number of membership and license purchasing transactions will also be targeted, and an improvement of around 200 million can be seen for the same. It sure looks like a beneficial acquisition for both companies. 

Apart from this funding round, other lead investors invested previously in ZhangYue are Guo Jin Capital and Animation Alpha. On 4 January 2016, Zhangyue raised a total capital of $100 Million in a  Series A funding round led by Guo Jin Capital and Animation Alpha. While significant Chinese entity, ByteDance, also have many acquisitions and funding rounds before investing in ZhangYue. Major investors of ByteDance are SoftBank Group,  General Atlantic, Hillhouse Capital Group, and Sequoia Capital. On 7 April 2017, Bytedance raised $1 Billion in a Series D funding round led by CCB International and Sequoia Capital; after this, On 11 April 2017, capital of $2 Billion was funded by General Atlantic in a private equity round. $3 Billion has been invested combinedly by Primavera Capital Group, General Atlantic, Kohlberg Kravis Robert, and Softbank group in a Series E funding round on 25 October 2018. Goldman Sachs and Morgan Stanley also financed $1.3 Billion in a debt financing round in April 2019. In 2017, Bytedance funded a news recommendation application called “BABE.” These are some major funding rounds led by ByteDance. Aside from funding and investments, some major acquisitions include the acquisition of Flipagram and Hypstar, a short video app, in 2017. It also acquired A famous news platform called News Republic in 2017. as per ByteDance 170m series zhangyueliaotechcrunch

According to both of the firms, the latest acquisition is expected to turn out valuable in various aspects such as market valuation, increased number of users, and overall features of the platform. Zhangyue is also planning to expand its market value and will work on its intellectual property license. This is going to be a profitable deal for both of the Chinese companies.

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