Editor’s note: This post originally appeared on TechNode, an editorial partner of TechCrunch based in China.
URWork, a billion-dollar-valued co-working in China, announced today that it has closed a RMB 200 million ($30 million) investment from Beijing’s Aikang Group. The deal is a strategic one that both sides said will grow the selection of services for URWork customers and help unlock additional revenue.
With over 20 years of investing in healthcare, finance, hospitality and real estate, the Aikang Group said it will bring resources from traditional sectors to help build a “highly innovative and specialized service-oriented co-working experience” that will go into effect in the first half of 2018.
The new investment adds to URWork’s six rounds of funding, which total RMB 1.2 billion ($175 million) and one merger since its launch in April 2015.
According to founder Mao Daqing, a former executive at Chinese real estate conglomerate Vanke, URWork’s annual revenue is at around RMB 400 million ($58.5 million), of which 75 percent comes from its core office space rental business. This investment from Aikang is aimed at generating additional monetization opportunities around its community.
“These are just the revenues that are tangible, but there is a lot of hidden money,” says Mao in an interview with local media [link in Chinese].
He is referring to the 25 percent of its revenue which is generated from its so-called value-added offerings, such as financial services, human resources, and healthcare. Its new strategic investment partnership from Aikang is design to boost those services and growth bottom line revenue.
URWork currently claims to serve 2,400 companies across 24 cities in China. It started its overseas expansion efforts in the second half of 2016, which to date includes the opening of locations in Singapore, London, Taiwan and New York City — the latter being an already crowded market that dominated by U.S. competitor WeWork.
Back in China, the tug of war between these two co-working giants heated up when WeWork announced $430 million in funding from Chinese investors at a valuation of over $1 billion. Shortly after, URWork confirmed its merger with New Space, a rumor that had circulated for over a year ago.
“We are not looking to create a monopoly. It will only be a matter of who becomes big, and who remains small, much like in the hotel industry,” Mao said of that coming-together.