Nearly a quarter of China-founded VCs make the Hurun Global VCs list.
Some 25 China-founded venture capital funds made it to the Hurun Global Venture Capitalists 2022 Half-Year Report released on Tuesday, which selected 121 VCs that have captured the largest number of unicorns and gazelles in their portfolios. (A gazelle company is a fast-growing enterprise with at least $100,000 in base revenue and four years of sustained revenue growth.)
US investment firms accounted for 71% of the list, while Chinese firms took 21%, and Singapore firms took 3%. Two Chinese VCs made it into the top 10. Tencent ranked fourth, behind Sequoia Capital, Softbank, and Tiger Global, investing in 122 unicorn and gazelle companies. CICC ranked fifth on the list with 115 investments.
The listed Chinese VCs invest in diverse industries, with biotechnology, smart manufacturing, and e-commerce as key industries that many pay attention to. The top 10 Chinese VCs on the list are Tencent, CICC Capital, Hillhouse Capital, Qiming Venture, CITIC Capital, Alibaba, Shunwei Capital, Yunfeng Financial, Dinghui Investment, and 5Y Capital.
Here’s what you need to know about the five top-ranking Chinese VCs from the list: Tencent, CICC Capital, Hillhouse Capital, Qiming Venture, and CITIC Capital.
Tencent Investment is a corporate venture capital arm of the Chinese tech giant Tencent. The firm has helped fund more than 1,300 companies, with a preference for investment in social networks, online games, e-commerce, and healthcare sectors.
Key bets include Pinduoduo, DiDi, Keep, Xiaohongshu, Webank, HeyTea, XSKY, and Discord.
Facing regulatory pressure and a slowing economy, Tencent Investment has been divesting recently, selling its stakes in Chinese e-commerce giant JD, Southeast Asian tech firm Sea, and the A-shares listed Huayi Brothers. There have also been reports that Tencent may sell most of its shares in Meituan. However, Tencent has officially denied it, with representatives saying that Tencent hasn’t set any target amount for reducing holdings and the company is not under external pressure concerning its portfolios.
In addition, Tencent itself has also suffered a cut in holdings by its majority shareholder Naspers Group this year.
2. CICC Capital
CICC Capital has invested in 115 unicorns and gazelles, as defined by Hurun, an increase of 55 compared to six months ago.
Beijing-based CICC Capital was a late participant in the venture capital party, forming in 2017, but has grown into one of the leading private investment managers in China. According to enterprise data site ITjuzi, CICC’s investments mainly focused on the healthcare and advanced manufacturing sectors. CICC has invested a total of 118 companies in these two sectors, with total investment hitting nearly RMB 12 billion ($1.72 billion).
CICC has invested in unicorn companies such as United Imaging and Horizon Robotics, as well as gazelle companies such as CH Biomedical and Dera.
3. Hillhouse Capital
Founded in 2005 by Chinese investor Zhang Lei, Hillhouse Capital’s investments included some leading technology companies worldwide, such as Uber, Airbnb, Tencent, JD, and Meituan. The firm also focuses on the health tech industry with investment in biotechnology companies such as BeiGene. Hillhouse Capital has participated in a total of eight fundraising rounds for BeiGene since 2014.
Hillhouse Capital’s top 10 stocks are Yatsen, Vipshop, iQiyi, Ke Holdings, Cytek Biosciences, JD, Gossamer Bio, IMAB, On Holding, and BeiGene. Seven of these are US-listed Chinese firms.
Since the first quarter of 2021, the firm has reduced its holdings of iQiyi, Pinduoduo, Uber, Uxin, Tuya, and Huazhu Hotels Group, while increasing its holdings in Yatsen, as well as Vipshop, Legend Biotech, and Alibaba during the past year.
As of the second quarter of this year, Hillhouse Capital held 64 stocks, with biotech, cloud computing, new energy, and other technology-based enterprises accounting for more than half of its total.
4. Qiming Venture
Founded in 2006, Qiming Venture now manages 11 US Dollar funds and seven RMB funds, with $9.4 billion in capital raised. Qiming Venture focuses on investing in healthcare, technology, and consumer industries, primarily involving itself in Series A and Series B funding.
According to Hurun, Qiming Venture has funded 59 unicorns and gazelles. Xiaomi, CanSinoBIO, Meituan, Bilibili, and Roborock have all received investments from Qiming Ventures.
5. CITIC Capital
Hong Kong-based CITIC Capital manages over $17 billion of capital. The firm has invested in 52 global unicorns and gazelles, as defined by Hurun, with medical technology, semiconductors, and intelligent manufacturing among its most promising investment directions.
The firm’s prominent portfolio hits include Express, Airdor, Quicktron, and XtalPi.