The online education provider pushed its total funding past $1.5bn in a round co-led by Tencent that valued it at $7.8bn.

Internet group Tencent co-led a $1bn series G round for China-based online education platform developer Yuanfudao yesterday with investment management firm Hillhouse Capital, Reuters reported.

Private equity firm Boyu Capital and venture capital group IDG Capital also participated in the round. The funding was secured at a $7.8bn valuation according to a company statement cited by Reuters.

Spun off from social media platform Fenbi in 2014 before it was shuttered, Yuanfudao operates an online education platform it claims has 400 million registered users.

The company offers online courses in addition to homework plans, covering primary and secondary school age groups. It has benefitted from an increase in activity as restrictions related to the Covid-19 pandemic force students to stay away from schools and learn at home.

Li Yong, founder and chief executive of Yuanfudao, said in an internal letter seen by DealStreetAsia: “The new investment is our series G round and some people jokingly asked if we plan to use up all the letters of the alphabet.

“The new round marks the continuous support and belief we have obtained from the capital market, as well as the arduous and lengthy path an online education company has to take.”

The round boosted Yuanfudao’s overall funding to about $1.54bn, Tencent having initially invested in 2015 when it co-led a $60m series D round with CMC Capital Partners and New Horizon Capital that included existing backers IDG Capital and Matrix Partners China.

Tencent invested $40m in Yuanfudao in 2016 and returned for a $120m round led by private equity firm Warburg Pincus the following year.

The company added $300m in a late 2018 round led by Tencent and backed by Warburg Pincus, Matrix Partners China and IDG Capital at a valuation of more than $3bn.