SoftBank Corp’s corporate venturing unit has led a $120m series B round of funding in China’s largest mobile application platform company, Wandoujia. The latest round brings the company’s total funding to date to a reported $128m, having raised $8m from SoftBank, DCM and its incubator, Innovation Work Development Fund, in 2011, all of which have also participated in the latest round.
In a statement, Wandoujia CEO Junyu Wang said that the funding will be used “to accelerate our growth and more openly serve developers and the entire ecosystem by developing technology and innovation in mobile search.”
The news of the sizeable investment puts the China company clearly in the lead for app platform services in China, where unlike other markets does not have a large Google-based games, email or app platform user base. According to figures from China mobile game developer and publisher, CocoaChina, the app sector was worth an estimated $1.2bn in 2013. The Wandoujia deal follows on from a July 2013 acquisition of 91 Wireless, an android-based app marketplace for $1.9bn by Baidu, a China internet company. According to the trade press rumour mill, other companies in the app distribution marketplace that are likely to want to go on the selling block or raise serious corporate venturing cash includes AppChina. But investors will be looking for a unique selling point to garner future growth, which may mean the company will have to develop something pretty special to outbeat the competition.
DCM first came across the company in 2011 and was attracted not only to its user numbers, which now are in the area of 300 million, but its user-friendly platform, including its internationally used desktop manager for Android-SnapPea, which sets it apart from the other 200 app stores already operating in China. Basically it has been the first in its segment that has integrated content across multiple channels including apps, games, videos, music, and other areas.
The company also has developed international partnerships, which makes the platform attractive to other app developers and internet companies in non-China markets, such as the US. Flipboard, Evernote, Line and Path are all reportedly distributing their content through the company’s app platform.
DCM general partner Hurst Lin is linked to the portfolio company; Law firm Paul Hastings LLP, advised SoftBank Corp. as the lead investor in the $120m round. Corporate partner David Wang led the Paul Hastings team with assistance from associate David Li.