Learn­ing app gets $71.9m from IPO

China Daily (Latin America Weekly) - - 14 Business - By HE WEI in Shang­hai hewei@chi­nadaily.com.cn

LAIX Inc, cre­ator of English learn­ing app Li­ul­ishuo, raised roughly $71.9 mil­lion in its Wall Street trad­ing de­but on Thurs­day, as it read­ies it­self for ex­pan­sion in the boom­ing on­line ed­u­ca­tion mar­ket.

Shares of the Shang­haibased firm closed up 1.2 per­cent at $12.65 per share on the New York Stock Ex­change, after open­ing up 28 per­cent on Thurs­day morn­ing.

Pro­ceeds from the IPO will be used to fi­nance re­search and de­vel­op­ment, as well as to con­tinue to in­vest in and de­velop its cur­rent tech­nolo­gies, ac­cord­ing to CEO Wang Yi.

The com­pany also plans to boost its mar­ket­ing ac­tiv­i­ties to ac­quire more users and fur­ther strengthen its brand, as well as ex­pand into the over­seas mar­ket in the fu­ture, he said, with­out elab­o­rat­ing on de­tails.

“LAIX refers to Life em­pow­ered by AI to reach (X) in­fi­nite pos­si­bil­i­ties,” said Wang ahead of the IPO, ex­plain­ing the firm’s re­brand­ing. “The list­ing will make us a more in­ter­na­tional com­pany and help us to at­tract cus­tomers all over the world.”

Founded in 2013 by Wang, a Prince­ton grad­u­ate and former prod­uct man­ager at Google Inc, Li­ul­ishuo — which means speak­ing flu­ently — aims to dis­rupt China’s con­ven­tional brick-and­mor­tar lan­guage schools, by us­ing AI, rather than hu­mans, to teach English.

It records users’ speech pat­terns be­fore pro­vid­ing cus­tom­ized lessons and tips on how to sound more like a na­tive English speaker.

The com­pany had 83.8 mil­lion cu­mu­la­tive reg­is­tered users glob­ally at the end of June, ac­cord­ing to its prospec­tus. It gives away ba­sic lessons for free and charges fees for more ad­vanced tu­tor­ing. It cur­rently has more than 1 mil­lion pay­ing cus­tomers.

“From day one we have not ruled out the pos­si­bil­ity of delv­ing into other realms us­ing AI. But English learn­ing is the one area that we would like to fo­cus on right now,” Wang said.

Con­sul­tancy iRe­search fore­cast that China’s boom­ing on­line ed­u­ca­tion mar­ket is poised to grow 20 per­cent an­nu­ally, reach­ing 270 bil­lion yuan ($39.2 bil­lion) by 2019.

“This sen­ti­ment of con­tin­u­ous progress in the work­place is driv­ing young Chi­nese white-col­lar work­ers to­ward a long-term remedy: ed­u­ca­tion,” said Du Miao­miao, an iRe­search an­a­lyst.

Hu­jiang EdTech, VIPKid and iTu­torGroup are among the star­tups that have raised funds re­cently to bankroll their ex­pan­sion, and have adopted al­go­rithms to op­ti­mize their prod­ucts.

“Our users are shift­ing from ‘ learn to sur­vive’ to ‘ learn to ad­vance and have fun,’” said Wang. “AI is set to make the learn­ing process more ef­fi­cient, tai­lored and ac­ces­si­ble.”

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