Photo/Tuchong

Oct. 17 (NBD) -- China's online reading platform Midu has closed a Series B financing in the amount of 100 million U.S. dollars, announced its parent company Qutoutiao Inc.(Qutoutiao, NASDAQ: QTT), China's second largest mobile content aggregator on Wednesday.

The round is led by CMC Capital and followed by Qutoutiao which remains as the majority shareholder of Midu.

National Business Daily found that Midu, which holds the operations of e-book apps Midu Novels and Midu Novels Life, previously raised 18 million U.S. dollars in a Series A funding round at the end of 2018.

"Midu continues to play a crucial part in Qutoutiao's overall content platform strategy," said Mr. Eric Siliang Tan, chairman and CEO of Qutoutiao.

Research firm QuestMobile's data shows that Midu had an average of 6.22 million DAUs (daily active users) as of this March. In April this year, Midu ranked No. 6 among Chinese online literature apps in terms of MAUs (monthly active users), and the top one on the list was Zhangyue Technology's iReader with 70.2 million MAUs. However, Midu saw higher engagement to its content because Midu users spent an average of 10.4 days on the app per month, 2.6 times more than that of iReader users.

The tremendous funding injected to Midu miniatures prospects in China's online literature market. There were 430 million users of online literature apps in 2018, up 14.3 percent year over year, and the number is expected to exceed 500 million in 2020, according to consulting firm iResearch.

The large cluster of readers add momentum to content creation and business growth in the industry.

NBD noticed that based on iResearch report, there witnessed an increasing number of online writers in China and the tally rose 11.6 percent to 8.75 million in 2018. Moreover, China's digital reading market maintains steady growth from 2012 to 2018, with each year reporting an over 20 percent year-on-year increase during the track period. In 2019, the market size is expected to be 18 billion yuan (2.5 billion U.S. dollars) and ballooned to 20.6 billion yuan (2.9 billion U.S. dollars) in 2020.

Eyeing the bright outlook for the digital reading market, more players expand their footprints in the industry.

Qutoutiao launched Midu in May 2018 and ByteDance, operator of short-video app TikTok and news aggregation platform Jinri Toutiao, later this March unveiled Fanqie Xiaoshuo (literally meaning tomato novels). Jinri Toutiao is the biggest rival to Qutoutiao.

Besides, China's e-commerce tycoon Alibaba also made forays into the industry via its internet literature arm Alibaba Literature which launched two e-book apps in 2018 including Tmall Reading and Miaodu. 

Email: gaohan@nbd.com.cn