China’s M31 Capital, backer of ByteDance and Grail, closes USD fund at $450m

Photo by Micheile Henderson on Unsplash

China-based investment firm M31 Capital announced on Tuesday that it has closed a USD-denominated fund at $450 million.

The new fund had initially targeted a corpus of $400 million and was near completion in early 2020, Patrick Zhong, founding partner of M31 Capital, told Chinese online publication PEdaily.cn in a report reposted by the firm.

The fund was expanded to $450 million upon “strong request” from global limited partners, or LPs, including sovereign wealth funds, university endowments, insurance firms, funds of funds (FOFs), family offices and entrepreneurs, said Zhong. He said that M31 Capital plans to invest in 12 to 15 firms through the new capital pool.

M31 Capital is also in the market raising its debut RMB-denominated fund, which will focus on early-stage startups in the fields of healthcare and advanced technology, he said.

Shanghai-based M31 Capital primarily backs grow-stage businesses in China with global perspective across areas including healthcare, mass consumption and TMT. It has invested in companies like ByteDance, the operator of viral video-sharing service TikTok, Chinese used car trading platform Guazi.com, and Grail, a US-based firm that develops technology for early detection of cancers.

The completion of the US dollar fund comes on the heels of Grail’s announcement of an agreement with Nasdaq-listed Illumina Inc, under which the San Diego-based gene sequencing firm would acquire Grail for cash and stock consideration of $8 billion.

As part of the deal, Grail’s shareholders will receive future payments representing a tiered single-digit percentage of certain GRAIL-related revenues. The transaction is expected to close in the second half of 2021, according to the announcement.

Patrick Zhong, founding partner of M31 Capital. Source: M31 Capital website

M31 Capital was founded in 2018 and named after “Messier 31,” which is the brightest galaxy visible to the naked eyes from Earth. The firm is led by Zhong, a seasoned investor with over two decades’ experience in venture capital, private equity, M&A and beyond.

Prior to M31 Capital, Zhong had been a vice president at US investment management firm Wellington Management Company, before he joined Chinese conglomerate Fosun Group in 2009 to lead the firm’s investment efforts.

“For the ten years following 2008, the twin focus of my investment interests became innovations driven by mobile Internet proliferation and rising Chinese consumerism. Now, I am even more intrigued with what’s looming large on the horizon,” Zhong wrote in a blog posted on the company website in February 2020.

He continued: “There is currently a multitude of technologies rising, with each one having the opportunity to create at least tens of billions of [US] dollars in value. These trends include the Internet of Things, big data, blockchain, augmented reality, autonomous driving, gene therapy and editing – just to name a few.”

Singapore Reporter/s

In Singapore, we are looking to double our reporting team by this year-end to comprehensively cover the fast-moving world of funded startups and VC, PE & M&A deals. We want reporters who can tell our readers what is really happening in these sectors and why it matters to markets, companies and consumers. The ability to write precisely and urgently is crucial for these roles. Ideal candidates must have to ability to work in a collaborative, dynamic, and fast-changing environment. We want our new hires to be digitally savvy and ready to experiment with new forms of storytelling. Most importantly, we are looking for hard-hitting reporters who work well in a team. Collaboration and collegiality are a must.

Following vacancies can be applied for (only in Singapore).

Following vacancies can be applied for (only in Singapore).   

  • A reporter to track companies/startups that have raised private capital, and have the potential to become unicorns. SEA currently has over 40 companies with a valuation of over $100 million and under $1 billion.
  • A reporter who can get behind the scenes and reveal how funding rounds are put together, or why they’ve failed to materialise. She/he in this role will largely focus on long-format stories. 
  • A journalist to track special situations funds, distressed debt and private credit (from the PE angle) across Asia.

Singapore Reporter/s

In Singapore, we are looking to double our reporting team by this year-end to comprehensively cover the fast-moving world of funded startups and VC, PE & M&A deals. We want reporters who can tell our readers what is really happening in these sectors and why it matters to markets, companies and consumers. The ability to write precisely and urgently is crucial for these roles. Ideal candidates must have to ability to work in a collaborative, dynamic, and fast-changing environment. We want our new hires to be digitally savvy and ready to experiment with new forms of storytelling. Most importantly, we are looking for hard-hitting reporters who work well in a team. Collaboration and collegiality are a must.

Following vacancies can be applied for (only in Singapore).

Following vacancies can be applied for (only in Singapore).   

  • A reporter to track companies/startups that have raised private capital, and have the potential to become unicorns. SEA currently has over 40 companies with a valuation of over $100 million and under $1 billion.
  • A reporter who can get behind the scenes and reveal how funding rounds are put together, or why they’ve failed to materialise. She/he in this role will largely focus on long-format stories. 
  • A journalist to track special situations funds, distressed debt and private credit (from the PE angle) across Asia.