Annual travel-funding report: Chinese companies raise $5.6 billion, down 70%
01/29/2021|10:47:31 AM|ChinaTravelNews

China’s company information platform Qichacha recently released a report on the financing and investments of the travel industry in the past decade.

More than 118,000 travel companies withdrew registration

Some 118,000 travel companies de-registered in 2020 – 15,000 in Q1, 38,000 in Q2, 33,000 in Q3 and 32,000 in Q4. The pace of de-registration was faster than the same period last year during Q2 to Q4.  

Compared to the year before, 1,000 more travel companies de-registered in Q2, 4,000 more in Q3, and 7,000 more in Q4, reflecting that the travel industry was showing no sign of post-pandemic recovery.

Over $77.3 billion was raised in the past decade

The Qichacha report showed that the travel industry had 2,734 financing and investment rounds in the past 10 years, raising around RMB 500 billion (USD 77.3 billion). From 2011 to 2016, the number was increasing year on year, and peaked at 649 rounds in 2016. Since then, the momentum had slowed.

The capital raised grew 20 times to nearly RMB 120 billion (USD 18.6 billion) in 2019 from RMB 5.4 billion (USD 835 million) in 2011. However, venture activities came to a standstill in 2020. The funding of the whole industry plummeted 70% to RMB 36 billion (USD 5.6 billion). It’s hard to predict if it will improve in 2021, given the resurgence of Covid-19 regionally.

37 mega-rounds raising hundreds of millions of yuan 

In 2020, there were 28 funding rounds raising tens of millions of yuan and 37 rounds raising hundreds of millions of yuan in the industry, according to the report. Quality services such as custom trips and outbound travel were investors’ favorites.

Top 10 financing rounds

Hong Kong-listed MGM China had the highest sum raised in 2020, having netted over RMB 6.6 billion (USD 1.02 billion). Shaanxi Chang'an Aviation Tourism followed with RMB 2 billion, and car rental giant UCAR came next with RMB 1.77 billion. Caissa Travel, Kkday, Utour, Beijing Zhiketong Technology and Movie Hotel were also among the top 10 companies in terms of capital raised during the year.