China's Sky9 raises $440m for early-stage, growth funds

The announcement of the final close comes less than 18 months after Sky9 hit the cap of $200 million on its debut US dollar-denominated fund. Cao launched Lightspeed's China operation in 2006 and retains some involvement in the firm's first two funds. He departed in mid-2016 and launched Sky9 shortly thereafter.

The new funds are Sky9 Capital Fund IV - named to reflect Cao's Lightspeed heritage - and Sky9 Capital MVP Fund. LPs include sovereign wealth funds, pension funds, and family offices. "MVP is a top-up fund that can work closely with the main fund to lead new rounds as well as doing follow-on rounds for breakout companies," Cao told AVCJ.

The venture fund will follow a similar strategy to its predecessor. It will focus on consumer internet, enterprise services and deep technology start-ups. On closing the first Sky9 fund, Cao expressed a desire to build a relatively concentrated portfolio and emphasize value creation capabilities.

"We have been investing Fund III since late 2016 and have built a strong portfolio. Fund IV's timing is perfect as we continue to sharpen our focus and dig even deeper into some of these areas that we see tremendous opportunities," Cao said.

Recent investments include leading a $100 million Series C round for Jingling, a social e-commerce platform. Sky9 has also backed the likes of community group purchasing business Songshupinpin, oil trading platform 51Zhaoyou, blockchain technology provider Ultrain, and Southeast Asian e-commerce operator Ezbuy.

 "We are entering an unparallel new phase of technology innovation. Breakthroughs in internet, media, software, infrastructure and artificial intelligence will be the largest opportunity for new businesses," Cao said in a statement.

Commitments to US dollar-denominated China venture funds stand at $4.25 billion so far this year. The 12-month total for 2018 was $13.1 billion, although it is an outlier. Approximately $3.9 billion was raised in 2017 and $9.1 billion the year before that. On the renminbi side, only $1 billion had been raised as of early September. This compares to $8.7 billion for 2018 in full.

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• Topics
• Greater China
• Fundraising
• Venture
• Technology
• GPs
• China
• Sky9 Capital
• TMT