E-books and tablet-based digital textbooks may be the cool new thing, but renting old-fashioned paper textbooks still seems to be attracting plenty of interest: Chegg, the leader in the textbook-rental market, just closed a new $75-million round of financing from an Asian investment company, according to multiple reports. The funding from Ace Limited of Hong Kong brings Chegg’s total war chest to almost $220 million.
Chegg closed a $112-million investment round last November, a combination of equity and debt financing led by Insight Venture Partners. The textbook-rental company has also gotten financing from Kleiner Perkins Caufield & Byers, Gabriel Venture Partners, Primera Capital and Foundation Capital. Another textbook-rental company, BookRenter, also got financing last fall, although it was a much smaller amount: the startup raised $6 million from Storm Ventures and Adams Capital Management, and added Netflix co-founder Mark Randolph to its board.
Chegg co-founder and CEO Osman Rashid isn’t putting all of his bets on printed textbooks, however: he is also one of the backers of a new digital textbook startup called Kno, which plans to launch a two-panel tablet computer dedicated to interactive electronic versions of textbooks. Kno raised $46 million in financing earlier this month in a funding round led by Andreessen Horowitz. The company says that it hopes to have its tablet device on the market by the end of this year, and has formed a partnership with several leading textbook publishers, including Wiley & Sons and McGraw-Hill.
Another startup that is going after the digital textbook market is Inkling, which is using the iPad as a platform for interactive textbooks, and recently launched its app — which includes 3D interactive graphics and other features. Inkling, which was founded by a former Apple employee, has also received funding from venture groups such as Sequoia Capital, Kapor Capital, Sherpalo Ventures and Felicis Ventures (the investment fund started by early Google staffer Aydin Senkut), although the company has not specified the exact amount of that financing.
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