Longzhong Xinyi Fund, a venture capital firm created by former Baidu senior vice president Xiang Hailong, has raised 200 million yuan ($29 million) for the debut RMB-denominated fund, roughly seven months after his departure from the Chinese internet search giant last May.
The fund will focus on investment opportunities in angel-stage startups that aim to provide products and services to corporate clients, which are also referred to companies under the so-called “to business (ToB)” model, said Xiang cited by Chinese online publication 36Kr.
Limited partners of the fund remained undisclosed, but Xiang said that he did not chip in the fund himself. Xiang revealed that the second investment vehicle of Longzhong Xinyi Fund will kick off the fundraising work in the second half of 2020.
Xiang could not be immediately reached for comments.
Previously a senior vice president and one of the closest lieutenants of Baidu founder and CEO Robin Li Yanhong, Xiang joined the firm in February 2005 and resigned in May 2019 due to “personal reasons,” according to a company announcement.
His departure follows a string of technology veterans who have jumped ship from Baidu to other places over the past few years.
Among the most prominent takeoffs, Lu Qi, a Chinese American who joined Baidu from Microsoft in January 2017 to bolster the new AI initiatives, stepped down as the company president and chief operating officer of Baidu in May 2018. Lu, the current head of startup incubator MiraclePlus, reportedly garnered about $100 million in the first closing of MiraclePlus’ debut fund in November 2019.
More recently, Wang Lu, former Baidu vice president in charge of public and government relations functions, left the company in late September 2019. Before them, Baidu president Zhang Ya-Qin retired in November 2019, while Andrew Ng, a Stanford and Google alumnus who worked as the chief scientist at Baidu responsible for researches related to big data and AI, left in 2017 after three years with the company.
Total revenues of Baidu reached 28.1 billion yuan ($4.08 billion) in the third quarter of 2019, up 3 per cent year over year and up 7 per cent quarter over quarter, according to its latest financial report released in November 2019.
Its online marketing stood at 20.4 billion yuan ($2.96 billion), decreasing 9 per cent year over year, while other revenues were 7.6 billion yuan ($1.10 billion), increasing 34 per cent year over year driven mainly by the strong growth in iQIYI membership, cloud services and smart devices.