Chinese square dancing app Tangdou has raised around $70 million Series C funding led by Tencent, IDG Capital, GGV and Shunwei Capital.
The silver economy video app completed $30 million funding in January 2017 from investors such as Shunwei and IDG.
It is probably the biggest entertainment fundraising aimed at the elderly and Tencent’s participation has drawn attention to China's huge ageing population.
The size of the sector that targets older members of society is expected to reach $744 billion by 2020, according to Hong Kong-listed firm CCID Consulting. The market value is calculated on everything from nursing homes and wearable devices, to service platforms that are focused on their needs.
Tangdou is just one example of an entertainment and service platform that targets the silver economy. It teaches synchronised dancing in public places, a fitness activity for some elderly people, and provides choreography and music.
But Tangdou wants to do more with its 400,000 monthly viewers and plans to morph into a social media platform with topics on everything from clothes to recipes. Users can also meet up offline via the app.
“I think Tangdou is a very good idea as it builds a social platform for old people. The elderly population in China has been underserved and most innovation is oriented at young people,” one investor commented. “But app developers need to be careful because elderly people have different purchasing habits from younger people, and their willingness to participate and share is often lower.”
The number of people aged 60 or more increased by 8.5 million last year, and now accounts for 17.9% of the total population. It is a market with huge user base.
But Chinese companies are approaching this sector with more value-added services, as traditional nursing homes are intensive asset business with meager profits.
Private equity and asset management company China Everbright Limited, for example, said that it is going through a “fumbling stage” to turn its nursing homes into a complex platform. The Hong Kong-listed firm owns two nursing home brands in China: Huichen Senior Care and Enjoy Twilight Years, which manage about 10,000 beds between them. Everbright wants to acquire another near Guangzhou or Shenzhen soon, but is focused on the service that it can provide to its customers.
“We want to be a service provider and build a platform in the pension industry that combines financial services, equipment and healthcare altogether,” said Chen Shuang, chief executive of China Everbright Limited.
Chen said that Everbright is developing wearable devices for the elderly which collects data which is then linked both to the family doctor and to company's financial services. This allows the company to monitor an individual's health and provide service and funding when it is needed.
Other companies provide silver sector online education and home services, although the market is still at an early-stage of development. Most investments last year were pre-Series B fundraising and comparatively small, according to third party research firm Qianzhan.
But with an ageing population in China, more companies want to participate early in this underserved market.