Meituan-Dianping GP closes consumer fund at $300m
Longzhu Capital, a venture capital firm established by Chinese online-to-offline (O2O) services platform Meituan-Dianping, has closed its debut fund at RMB2 billion ($300 million).
The vehicle launched in early 2017 with the aim of raising RMB3 billion and a brief to make early-stage consumer investments. At the time, RMB1.5 billion was supposed to be the first close, but the most recent announcement claims that was the target for the entire fund.
LPs include Meituan-Dianping itself as well as Tencent Holdings, New Hope Group, and funds established by the likes of China Development Bank Capital, Noah Holdings-owned Gopher Asset Management, XJ Fund Town, and China Merchants Capital, a unit of China Merchants Group. Tencent is also a significant investor in Meituan-Dianping.
Longzhu is managed by Shaohui Chen, senior vice president of Meituan-Dianping. Chen was previously a senior investment manager at Tencent. The firm also hired Yonghua Zhu, formerly a partner at Tiantu Capital and an executive director at Legend Holdings, as a founding partner. Across the entire team, an average of eight years has been spent with investment firms.
Longzhu combines the Meituan-Dianping platform – leveraging its parent company’s marketing, supply chain, IT, and management capabilities – with a market-oriented investment agenda intended to help develop consumer brands and enterprises. It primarily focuses on three areas: new retail, dining and hospitality, and lifestyle services.
Portfolio companies include bubble tea chain HeyTea, O2O cake-ordering business Bliss Cake, grocery delivery platform Kangpinhui, healthy eating app Sweetie Salad, seafood products brand Asiasea, and B2B consumer electronics distributor Zskuaixiao.
Last month, Meituan-Dianping filed for a Hong Kong IPO and will reportedly seek to raise $4 billion at a valuation of $60 billion. The company has received substantial venture capital and private equity backing.
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