IDG Capital and CreditEase New Finance Industrial Investment Fund have invested RMB80 million (US$11 million) in CreditEase Insurance Agency, an Internet insurance unit of Chinese financial services company CreditEase Group, according to a company announcement.
The round valued the five-year-old start-up at RMB1.4 billion (US$200 million) post-money.
"Insurance, especially Internet insurance, is one of our focuses at IDG. The industry has massive potential, and CreditEase Insurance is the leading company in the Internet insurance sector as it stands out in market share, management team, business model and product structure," said Li Xiaojun, a partner at IDG Capital.
Established in 2011 with RMB50 million (US$7 million) in registered capital as a subsidiary under Beijing-based CreditEase, the unit is the selling agency for thousands of insurance products via partnerships with over 50 domestic and overseas insurance companies. It was listed on the New Third Board in China, or the National Equities Exchange and Quotations, in December last year.
Its parent CreditEase was founded in 2006 and specializes in small business and consumer lending, as well as wealth management for high-net-worth individuals and mass affluent investors. Yirendai, an online consumer finance marketplace majority-owned by CreditEase, is listed on the New York Stock Exchange.
CreditEase Insurance Agency plans to use the proceed to develop its wholly owned subsidiary Xiaozhi Technology, a search engine to find the most suitable insurance products for consumers.
CreditEase's rival Shanghai-based Zhong An Insurance raised RMB5.775 billion (US$931 million) in funding round from five investors including Morgan Stanley, China International Capital Corporation Limited (CICC) and CDH Investments in 2015.