Matrix closes third China VC fund at $350m

Matrix Partners China was set up in 2008 and now has more than $1 billion in capital under management. Its first vehicle raised $275 million in 2008, beating its target of $250 million. Fund II reached a final close of $350 million three years later.

The new fund will follow a similar strategy to that of its predecessors, targeting companies in technology, media and telecommunications (TMT) and healthcare. The internet and mobile spaces are Matrix's historical sweet spots. Previous investments include Eachnet, Focus Media, Baidu, Qihoo 360, 21ViaNet, Bona Film and Cheetah Mobile.

The Beijing-based investment team is led by David Zhang, David Su and Bo Shao.

"The Chinese market continues to present excellent opportunities to build major, highly valued stand-alone businesses," said Timothy A. Barrows, managing partner of Matrix Partners, in a statement. "We'd like to thank our limited partners for their enthusiastic and longstanding support of Matrix Partners China."

Only eight China venture capital funds reached a close in the first three months of 2014, well below the average of 15 for the last two years, but they raised $1.3 billion between them, the largest quarterly total in about two years.

Qiming Venture Partners and DCM led the way. The former took just a few months to accumulate $500 million for its fourth US dollar fund. The latter closed DCM VII at $330 million, above target but smaller than its predecessors in anticipation of reduced activity in the US, although China will play a more significant role.

Fundraising momentum is expected to continue into the second quarter with GGV Capital expected to close its fifth US and China-focused fund at around $500 million this month - with a further $100 million from renminbi investors - and Legend Capital likely to raise $500 million for its sixth vehicle.

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• Topics
• Fundraising
• Venture
• Greater China
• Technology
• TMT
• China
• Venture
• Fundraising
• Matrix Partners