China's CCV raises $150m opportunity fund

AVCJ was informed of the fundraise by a source close to the situation. 

CCV, which was established in 2016 through a spinout by KPCB's China technology, media, and telecom (TMT) team, closed its second flagship US dollar-denominated fund on USD 319m in late 2020, beating a target of USD 250m. It raised nearly USD 200m for its debut fund in 2017 and CNY 1.5bn (USD 220m) for a renminbi vehicle around the same time.

Speaking at the AVCJ Private Equity & Venture Forum, Wei Zhou, founding managing partner of CCV, said he plans to launch a third flagship fund next year as well as another opportunity fund. In addition to supporting existing portfolio companies, the opportunity fund invests in so-called “new mature startups." These are typically spinouts from portfolio companies or listed businesses.

Perfect Corp, a Taiwan-based augmented reality solution provider for the beauty industry that recently went public in the US following a merger with a special purpose acquisition company (SPAC), received funding from CCV after spinout out from Taiwan-listed software developer Cyberlink.

CCV is also an investor in Transsnet, an Africa-focused payments and digital bank platform. The company spun out from Shenzhen-based mobile phone manufacturer Transsion, which generates most of its revenue from Africa. Zhou noted that such companies qualify as "new mature" because they are often business units of larger players that have expanded into new markets.

“When innovative business units go independent, we can be an investor in their Series A. Although these are only initial funding rounds, the companies are more mature and lower risk than typical Series A companies. The success rate is higher," he said.

In an earlier interview, Zhou said that the biggest opportunity in China today lies in the shift from the mobile-internet era to the intelligence era. China has a competitive edge globally - which means start-ups can think internationally - because no other country excels in a combination of three key technologies: artificial intelligence that defines human-machine communication, autonomous driving, and robotics.

"There are opportunities for US dollar funds to back Chinese entrepreneurs who want to go global and help them with that expansion into new markets," he said.

"Most of the revenue may come from overseas. It is a bit like when Japanese enterprises went global in the 1960s and 1970s on the back of the evolution in high-end manufacturing. World-leading Japanese companies were created in automobiles, ships, and rail."

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