Tourism IT Fangcang raises almost US$10 million in Series A financing
Fangcang has raised RMB60 million in a Series A financing, the third round of investment for Fangcang in two years.
ChinaTravelNews – Hotel and Tourism IT startup Fangcang has raised RMB60 million (approx: US$9.69 million) in a Series A financing. This is the third round of investment for Fangcang in two years following an initial angel investment and a RMB10 million (approx: US$1.6 million) Pre-A financing round from and Qing Song Fund.
Shenzhen-based Fancang offers cloud technology and online product and ecommerce solutions to suppliers such as hotels, tour operators and hotel wholesale suppliers as well as ecommerce platforms like OTAs.
Fangcang launched its first-generation products in April 2014 and has developed B2C channels directly linking traditional offline tour operators with OTAs like Ctrip, Qunar, Alitrip and eLong in the past year. It has also made direct B2B links between hotels and travel companies and has leveraged cloud technology to establish an upstream-downstream interactive ecosystem.
Fangcang serves as a “facilitator” in its cloud ecosystem by helping traditional tour operators digitize operations. It also maintains neutral and non-competitive cooperative relationships with all its customers such as OTAs, wholesalers, distributors and hotel PMS, and has gained popularity with users and partners.
Fangcang’s operations are entering a long period of high growth and its cloud platform already processes 200 million transactions per month. Transactional traffic on its platform is estimated to exceed one billion transactions per month within a year.
Fangcang’s CEO Qing Xu said the company currently earns revenues mainly from tech service fees, including the annual fees for its SaaS system, and transaction fees. He is focusing on leveraging information flow and capital flow of Fangcang’s online ecosystem in its business model. While Fangcang will continue to offer upstream-downstream information solutions OTAs, it will also develop online finance to offer financial solutions.
The scale of China’s tourism market will exceed RMB4 trillion in three years, according to Mr. Xu. “Problems such as serious information errors, outdated technology, inefficient supply chains, low financial leverage and high costs will exist between upstream-downstream tourism suppliers and distributors in this market. Supported by big data, Fangcang has already perfected the major flow of online information in the industry, from tourism suppliers and distributors to the entire financial supply chain that offers payment, billing, assurance and loan solutions,” he said.(Translation by David)