(Yicai Global) Oct. 17 -- News aggregator Qutoutiao's online literature app Midu Novels has wrapped up a USD100 million funding B-round led by China Media Capital, valuing it at USD118 million.
Shanghai-based Qutoutiao will use the proceeds to build up Midu Novels' content, construct an author ecosystem and conduct marketing that boosts competitiveness, online startup-centric media Lieyunwang reported, citing the company.
China's online literature market totaled CNY15.3 billion (USD2.2 billion) last year, up 20 percent from a year earlier, and is likely to exceed CNY20 billion next year, according to data from app analytics firm iResearch Consulting Group. Qutoutiao, which started in June 2016, is one of the major rivals of the news content platform Jinri Toutiao under Beijing-based Bytedance Technology.
"Midu continues to play a crucial part in Qutoutiao's overall content platform strategy," Qutoutiao Chief Executive Eric Tan said. "We have a clear roadmap ahead for Midu, and our objectives of reaching more than 10 million DAUs (daily active users) by the end of the year and becoming the largest online literature platform in China by 2020 remain unchanged."
Midu Novels is a free reading app released in May last year. Its users can peruse genuine online literary works free of charge by watching adverts. Midu Novels had 40 million active users late last year, including 5 million DAUs, with each reading two and a half hours per day on average, Qutoutiao's financial report showed in March.
Beijing and Shanghai regulators summoned Midu Novels and other online literature platforms for a meeting on July 15 and demanded the removal of low-brow and salacious content. The app shelved further updates and paused its operations for so-called rectification and tech upgrades from July 16 to Oct. 15.
Qutoutiao listed in the US in September last year. The firm's stock [NASDAQ:QTT] closed 2.4 percent higher yesterday at USD3.37, fixing its market value at around USD974 million.
Editor: Ben Armour