AI-based startup Riiid raises $175 mn from SoftBank

Artificial intelligence-based learning platform Riiid Inc. has raised $175 million from SoftBank Vision Fund 2, the South Korean company said on May 25. 

The latest investment comes after the startup was named to the annual AI 100 list issued by global market research firm CB Insights. It was the first time a domestic startup has been on the list since 2017. The AI 100 is a list of the world's 100 most promising artificial intelligence companies. 

The new funding has brought its total amount raised to 284 billion won ($253 million) since its inception in 2014.

Its previous investors include leading domestic VC firms Premier Partners, AlpenRoute Asset Management, DSC Investment, IMM Investment, Korea Growth Investment Corp. and D Ventures Private Investment Fund. In July 2020, the state-run Korea Development Bank participated in Riiid's 50-billion-won funding round. 

Riiid is a web and mobile learning platform where the AI tutor provides a one-on-one curriculum and personalized questions and lectures for the learner.

According to the company, 20-hour study with its flagship product Santa TOEIC, using accumulated learning data of over 100 million cases, will likely result in a TOEIC score increase by an average 165, for which a score of 900 or more is considered high. 

The startup became the third South Korean company of which the venture capital fund was the sole participant in a funding round.

Last month, Vision Fund invested $160 million in IYUNO Media Group in a follow-on investment in the content localization firm providing translating, subtitling and dubbing services to over-the-top and other media companies.

SoftBank's first Korean investment was in Coupang Corp. that went public in New York in March to raise $4.6 billion.

Riiid plans to use the proceeds to strengthen AI technology so as to widen its gap in the global edutech market. In Silicon Valley, Canada and Ghana in Africa, It is building R&D centers and data labeling centers where data are annotated, tagged and classified.

"By changing the content creation and distribution-focused education paradigm  to a technology and AI-based one, Riiid will create a true level-playing field for students," said its founder and CEO YJ Jang. "To do so, we will cooperate not only with overseas but also domestic companies."

After graduating from the Haas School of Business at UC Berkeley in 2012, he co-founded Tapas Media Inc., a US-based digital comics platform, where Kakao Corp. is now the largest shareholder.

In an interview with a local daily, Jang said he had made up his mind to enter UC Berkeley during his military service period when he was dumped by his ex-girlfriend. At the time, she was dating a UC Berkeley graduate.

Write to Jong-woo Kim at jongwoo@hankyung.com
Yeonhee Kim edited this article.