Yunfeng Capital creates cloud computing fund with Alibaba
Yunfeng Capital, the venture capital firm set up by Alibaba Group founder Jack Ma, is to create a RMB1 billion ($157 million) fund with Alibaba Cloud Computing. It will invest in cloud computing businesses and developers building applications for Aliyun OS, the e-commerce company’s new operating system.
Aliyun can run Android apps, but the company wants to create a community of cloud-based services that facilitate access to Alibaba's Taobao Mall and Taobao Marketplace, two of the largest online retail sites in China. A new phone and tablet featuring the operating system will be released to coincide with the launch of Aliyun 2.0 later this year.
Alibaba's move comes as China's leading internet companies, such as Baidu and Tencent, expand into the smartphone market. Foreign operating systems still dominate China, led by Nokia's Symbian, Google's Android and Apple's iOS.
Yunfeng Capital, which is raising a debut fund of $1.5 billion, has quickly become one of China's highest-profile VC players, largely thanks to Ma's connections. It invested in GaoPeng, Groupon's Chinese incarnation run in association with Tencent that is now said to be struggling, and participated in a consortium led by The Carlyle Group that purchased an 80% stake in GDC Technology, Asia's largest cinema digital server provider.
Yunfeng, Sliver Lake, DST Global and Temasek Holdings invested in Alibaba Group in September through a $1.6 billion tender offer intended to allow employee shareholders and option holders the opportunity to exit. The same companies have been linked to a potential acquisition of all or part of Yahoo, which holds a 40% stake in Alibaba Group.
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