China’s top 6 angel investors

Apr 10, 2018

With an increasingly tech-savvy population, maturing tech ecosystem and government support, it’s arguably the best timing to start a business in China. The startup craze fosters a growing appetite for venture capital firms in the country. Greater China attracted $65 billion, or 36 % of the total global venture capital in 2017, next only to US’s $76.4 billion, figures from data service Preqin show.

Even combining all these, getting your business from idea to minimum viable product is a daunting task. Getting the initial funds is perhaps the most important step when building a company from scratch. 3F (Friends, Family, and Fools) is usually the best chance for obtaining initial investment. But professional angel investors, who boast better understanding of the industry and entrepreneurship, are a better choice for long-term development.

However, angel investors can be a confusing crowd with different industry focus and style. For entrepreneurs who want to court their own angel, here’s a list of top angel investors in China.

Kaifu Lee

As a veteran investor and startup guru, Kaifu Lee is probably one of the most prominent figures in China’s tech world. After getting a PhD in computer science in 1988, Lee worked as top management for Apple, Microsoft, and Google. His solid IT background and work experience with US’s top tech giants have gained him a respectable reputation not only in China but also in Silicon Valley.

He now serves as the founder and CEO of Sinovation Ventures, an accelerator/VC formerly known as Innovation Works. The firm is focused on areas including artificial intelligence (AI) and big data, content and entertainment, consumption upgrade, B2B trade and enterprise services, and education. With a preference for teams with strong technical backgrounds, Sinovation Ventures has recorded lots of successful cases in Wandoujia, Zhihu, and Meitu. The firm is planning to raise $500 million for a fourth fund.

Although bearing a scholarly manner, Lee was quite outspoken in giving his ideas on the latest tech trends and advice for young entrepreneurs. It’s worth noting that Lee is a firm believer in AI technology, so much so that he predicts that AI will be the future and has written a book to explain the benefits and challenges from AI.

In his personal life, Dr. Lee experienced a tough 2013, when he was struck by lymph cancer and forced to stop working. Luckily, he recovered 17 months later and came back to the limelight with his new book “Living Towards Death” to share his thoughts on life and death.

Xu Xiaoping (Bob Xu)

Even before finding his identity as an angel investor, Bob Xu made himself a legend as one of the three co- founders of New Oriental Education & Technology Group, the largest provider of private educational services in China. The story of New Oriental has inspired a blockbuster movie called “American Dreams in China”, which pulled in a box office of RMB 537 million.

After stepping down from New Oriental in 2006, Bob Xu founded ZhenFund with his former partner Wang Qiang and Sequoia Capital to focus on investments in gaming, online education, e-commerce, and mobile internet. The fund plans to raise $190 million for a fifth venture fund within the year.

Founded in 2011, ZhenFund’s profile includes a series of successful projects like Jiayuan, Lightinthebox, Jumei, Red, Miya, 51Talk, Ehang, and Chumenwenwen.

Given his churlishness and outspoken temper, Xu’s incisive insights on the industry often made headlines of local media. Xu called fellow investors to fully embrace blockchain technology in an internal WeChat group. The leaked chat sparked heated discussions in the industry. While some agree with his proposition on blockchain technology, some accused him of trying to pump up the blockchain hype for financial gain.

Cai Wensheng (Mike Cai)

Although never receiving a higher education, Cai built his reputation as a shrewd investor and industry insider.

Cai made a fortune from internet domain name investment and begin to set up his own startups. One of his most successful endeavors is web directory 265.com, a clone of Hao123.com which was acquired by Chinese search giant Baidu in 2004.

Gradually the young entrepreneur became a renowned angel investor. His portfolio companies include Chinese hit services Meitu (photo-centered startup), Baofeng (video player developer and video content provider), CNZZ (online data service), 58.com (classified site), Feiyu Technology (mobile and web game developer) and Flashget Downloads.

Cai is associated with many Fujian located tech companies and has developed a preference for grassroots entrepreneurs like himself. His investment focuses include entertainment and internet services.

Xue Manzi (Charles Xue)

Xue Manzi, the Chinese-American billionaire capitalist, is among the earliest and most active angel investors in China’s internet industry. As the co-founder of UT Starcom, Xue once worked as senior management of 8848 Electronic Commerce Network and ChinaEdu.net. His also the investor of PCPOP, auto vehicle portal Autohome and fintech platform Snowball.

Xue is investing through Manzi Fund focusing on areas including mobile internet, healthcare, fintech, education, entertainment. The RMB 500 million fund has invested in over 100 startups, mostly in the angel round. He’s also one of the earliest investors that are placing bets on blockchain technology.

In addition to being a prominent investor, the silver-haired Xue is quite a controversial figure. Born to a senior political family in China, Xue had a tough younger life during the Cultural Revolution and then finished his higher education in the US. Given his personal experience, he is a leading liberal commentator on the social media scene, where he usually posts poignant commentaries about the government. Xue was detained in Beijing for suspected involvement in prostitution in 2013.

Lei Jun

More commonly known as the founder of smartphone maker Xiaomi, Lei Jun represents a new group of IT billionaires who are hunting for the next unicorns through angel investments.

Before founding Xiaomi, Lei Jun once worked as board chairman of UCWeb, the leading Chinese mobile browser acquired by Alibaba. He is the former executive director of Kingsoft and co-founder of Joyo.com which was sold to Amazon in 2004.

Lei is now investing through Shunwei Capital, an angel investment fund he co-founded with Tuck Lye Koh in 2011. As of November last year, Xiaomi and its Shunwei Capital (顺为资本) have invested $4 billion in 300 companies such as self-balancing scooter Ninebot, 17zuoye, video streaming service provider iQiyi, Renrenche, 51Talk, Aiyibang, Misfit, and Xiaomi’s real-time video call provider Agora.io.

Xiaomi’s phones are achieving huge success in India and Lei is planning to replicate China’s business model in India by investing $1 billion to 100 Indian startups.

Shen Nanpeng (Neil Shen)

As the founding and managing partner of Sequoia Capital China, Shen Nanpeng has topped venture capital investor lists over the past few years. His most recent feat is to hit the top spot at Forbe’s Midas List for 2018.

After becoming a successful entrepreneur as the co-founder of Chinese travel site Ctrip, he is on the founding team of Sequoia Capital China, one the most active and influential VC firms in China. In addition to being an angel investor, Shen is also very active in later-stage investments. His successful investments include Meituan, Momo, Vipshop Holdings, Qihoo 360, AutoNavi Holdings and JD.