How Tiger Fund Hunts Techie Pandas
Nov. 21st , YY Inc. priced its 7.8 million share IPO in Nasdaq at $10.50 and began trading on that day. In 2011, Tiger invested $76m in YY, and now the value was almost halved to approximately $40.27m.
Since 2003, Tiger Fund has started sowing seeds in China tech industry, with ecomm being its main focus. How did the tiger hunt China’s technie pandas? Maybe we can uncover some clues by reading its footprints that local media tracked.
Getting over Dangdang
NYSE-listed Dangdang received $11m investments from Tiger Fund in 2004, and made an IPO six years later. Tiger Fund owned about 34.5% of the company at the time of its public offering. However, in 2011, together with DCM, IDG and Morgan Stanley, the venture capital sold out all its Dangdang share and earned a sixteenfold return on it. Industry insider said that Dangdang kept to a too conservative strategy despite having sufficient cash after listing. And it consequently has influenced its performances in markets. Tiger left at the point when Dangdang’s still going well, which turned out to be a wise choice as Dangdang stock has been declining since then.
Feeding 360Buy
News about the Chinese e-tailer 360buy has been focusing on two themes for a long time: #1, It will soon go for an IPO which in reality it hasn’t. #2, it’s been losing money seriously. Who is feeding this company with so much cash to burn? Obviously Tiger is one of them, and the number it offered keeps on growing. Tiger led the round in Jan. 2010 with more than $150 million; followed with the Series C round of over $1.5 billion in April 2011 it led. Last month, 360Buy had just finished its funding of $400m, and Tiger was still on the investors’ list. Currently the company is valued at $7.25 billion and has raised $2100m in total. But when it will get listed is still unknown, though according to CEO Liu Qiangdong it might be in next year. If you believe it.
Vertical B2C Letao
Letao is an online B2C focusing on footwear, announced June 2010 the completion of raising more than US$ 10 million from Tiger Fund and DT Capital Partners in second round. Earlier this year, the company finished the fourth round receiving tens million dollars with Tiger’s participation. Tiger favored Letao for its vertical advantages, but it actually failed to live up to the expectations.
Bring VANCL back to life
Another hunting story is about the apparel etailer VANCL. This company has gone through ups and downs since founded in 2007, Tiger appeared in 2010 when the ice age of Chinese B2C was just around the corner. Tiger invested $50m in VANCL’s D round and kept on putting in money from that round on. Receiving the support, VANCL has kept low-profile for two years, struggling to survive, waiting for the market to get warmer. Right now the company has been on a better track and some investor revealed that it has been quite ready for an IPO.