Deal focus: PingCap sees borderless future in the cloud

Last week, the US passed new foreign investment review legislation with a rare bilateral conviction that has been widely interpreted as a direct affront to Chinese involvement in the local technology space. But it will take more than that to keep these two ecosystems from continuing to intertwine. 

Fosun Group and Morningside Venture Capital proved the point last week by leading a $50 million Series C funding round in China-US data technology services company PingCap. The deal included participation by all the company’s existing backers, including China Growth Capital, Yunqi Partners, and Matrix Partners China. 

PingCap is still officially headquartered in Beijing, although its social media presence indicates a home base in Silicon Valley, and the US office and operations are expected to grow significantly in the coming years. This is essentially rooted in a belief in the universal virtues of open source software

“Open source is by definition global and borderless, thus expanding into new markets is more natural than other industries,” says Kevin Xu, PingCap’s general manager for US strategy and operations. “We are focusing on expanding into North America, because it has the most mature cloud market. It makes sense for us to tackle it as a cloud-native distributed database company.”

Founded in 2015 by engineers who formerly worked for the likes of Twitter, JD.com, and Baidu, PingCap offers an open source, cloud-based database system used in real-time analytics known as TiDB. The product is touted as a one-stop shop for both online transactional and analytical processing. 

TiDB is part of a new breed of versatile databases known as NewSQL systems, and is designed to work in both public, private, or hybrid clouds, making deployment, provisioning, and maintenance comparatively simple. The database is also said to have infinite horizontal scalability, freeing users from perennial worries around capacity limits.   

Previous investment includes a $15 million Series B last year led by China Growth Capital that also included participation from K2 Ventures and Frees Fund. The round was aimed at building out a global customer base that now includes Mobike, Bank of Beijing, Hulu, Lenovo, and Ele.me. TiDB alone is used by more than 300 companies, including Tencent Holdings and Meituan-Dianping.

Xu notes that the latest round will be used to make investments in support of long-term goals around distributed database development. As this plan gradually comes together, it is expected that the continued commercial adoption of decentralized computing power will create the kind of ecosystem where a competitive edge will be all the more essential.   

“The emergence of the cloud has fundamentally changed the way infrastructure technology products are consumed, including databases,” Xu says. “Luckily, TiDB’s architecture is purposely designed to work well in the cloud -- this differentiator will be a driver of our growth.”

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