5Y raises $2b across dollar, renminbi funds

The US dollar offering - the firm's sixth - comprises separate early-stage and growth-stage funds. 5Y raised $1 billion in the previous vintage in 2018, a significant step up from $660 million for the fund before that. Funds IV and V each featured VC, growth and co-investment tranches. Similar details were not given for Fund VI.

5Y said in a statement that the new funds were oversubscribed, receiving strong support from new and existing investors despite a relatively short marketing process. 

The fundraise follows a rebranding of the firm, which was previously known as Morningside Venture Capital. The firm was launched in 1999 by Richard Liu and Ken Shi - who remain in charge - under Morningside Group, the family office of the Chan family, founders of Hong Kong property developer Hang Lung Group. Liu and Shi made China technology, media and telecom (TMT) investments.

They went independent in 2007, raising a $150 million debut fund. The family office contributed two-thirds of the corpus and Gerald Chan, chairman of Morningside Group, came in as a partner and investment committee member. Over time, both parties concluded that coexisting under the same name no longer made sense.

Shi told AVCJ in a previous interview that the re-branding process began in 2018. “As we did more deals, we were occupying more of Dr. Chan’s time with investment committee meetings. In 2018, he suggested that his presence was no longer required because we were a mature institution with good returns. He thought that we deserved our own brand,” says Shi. He adds that Morningside Group remains the largest LP in 5Y’s funds.

5Y is arguably most famous for its investment in mobile phone brand Xiaomi. As the company's first institutional backer, it has realized a return of 800x. Other notable portfolio companies include UCWeb, YY, Huami, Musical.ly, Horizon Robotics, and Pony.ai.

There have been several IPOs since the start of 2020. Among them are short video platform Kuaishou, electric vehicle manufacturer Xpeng, real-time communication player Agora, and audio streaming and social networking platform Lizhi.

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• Topics
• Greater China
• Fundraising
• Technology
• Venture
• Renminbi fund
• China
• 5Y capital
• TMT