C Ventures, a private investment vehicle backed by a member of the family behind Chow Tai Fook Enterprises and New World Development, is eager to bet on more new-economy start-ups by leveraging on its “huge” capital resources and business networks.
The firm has so far invested in more than 50 companies since its founding in 2017, building a portfolio that includes mainland Chinese entities like RoboticPlus. AI and smart-mirror maker Fiture, as well as Hong Kong logistics firm Lalamove, which is said to be preparing a US$1 billion stock listing plan.
China has been a fountain of opportunities for local private equity firms like Hillhouse Capital and global heavyweights like Sequoia Capital, leaving newer and niche players with all to do by counting on their non-financial advantages to build their presence.
“Good start-up companies do not lack capital, they look for good partners that help them grow their business,” managing director Ben Cheng said in an interview. “We have [other] resources that money cannot buy.”
Ben Cheng, managing director of C Ventures. Photo: Handout
C Ventures is co-founded by Adrian Cheng Chi-kong, the third-generation scion of Hong Kong’s third richest family according to Forbes’ ranking. The firm targets millennials and Gen Z with “disruptive” businesses in technology, lifestyle and media.
Some 136 start-up companies worldwide achieved unicorn status last quarter, or those with valuation of more than US$1 billion, according to a report published by CB Insights, compared with 23 a year earlier. This has already surpassed the 128 recorded in all of 2020.
Funding surged 157 per cent to US$156 billion globally, the most in the past decade. While funding to China-based companies declined, the first-half infusion of US$29.3 billion is still 42 per cent above the level in the same period last year, the CB Insights report shows.
Ben Cheng, managing director of C Ventures, says start-ups backed by the company can piggyback on New World Development’s assets like K11 mall to aid their growth. Photo: Edward Wong
“There are two categories of investors in China, one is powerful brands like Hillhouse and Sequoia, and the other is strategic investors with resources like Alibaba and Tencent,” said Cheng, who is not related to the billionaire family. “We see ourselves as belonging to the second category.”
C Ventures is prepared to boost its funding in investee companies, beyond the current range of US$10 million to US$15 million each, to as much as US$100 million, he added. While Chinese companies account for a majority of its bets, it has not ignored investments in other countries to keep up with its role of bridging the West and China.
The firm’s association with Chow Tai Fook and New World Development has helped C Ventures deploy its “intangible assets” such as hotels, shopping malls and infrastructure to attract quality start-ups, Cheng said, citing its investment in fitness technology firm Fiture as an example.
Adrian Cheng Chi-kong, CEO and executive vice-chairman of New World Development. He is also the co-founder of private investment firm C Ventures. Photo: Xiaomei Chen
The firm joined Tencent Holdings in October in leading the US$65 million financing round in Fiture, a mirror-like workout screen that offers interactive classes and customised training programmes. The start-up achieved a US$1 billion valuation about six months after the funding.
“Fiture is a much sought-after company by investment funds,” said Cheng. “They accepted our investment because we provide them with a physical offering, allowing it to appear in New World’s subsidiary brands, including K11 and D Park malls, serviced flats, as well as its Rosewood hotels.”
Last month, C Ventures took part in Casetify’s Series A fundraising, marking the Hong Kong-based tech accessories firm’s first external funding since its founding in 2011, counting its access in the mainland market as an edge.
“We told [them] to please take our investment,” Cheng said. “We can open doors in China for them.”