Unicorn Capital Partners, a China-focused venture capital fund-of-funds, has made the first close of its fourth fund – Unicorn Partners Fund III LP – at $353.5 million, attracting commitments from 64 investors, according to a US SEC filing.
The Hong Kong-based venture capital firm did not specify the hard cap for the fourth fund, which was launched in April last year, and the new vehicle will likely continue to invest in the areas of technology, media, and entertainment (TME), and healthcare throughout China, in line with its three predecessor funds.
Unicorn Capital Partners announced the close of Fund II in July 2018 after hitting its hard cap of $250 million. It raised $210 million for Debut Fund in 2016 and $12 million for Unicorn Partners Fund I in 2015.
The US SEC filing also did not specify the target closing date for Fund III although Unicorn Capital indicted in the document that it does not expect the fundraise to last longer than 12 months.
The firm was founded by Kah-Fai Low and Tommy Yip in 2015. Yip left private equity fund-of-funds manager Emerald Hill to start Unicorn Capital, which backs emerging venture capital funds that invest in technology startups with the potential to become unicorns.
“We believe there are increasing opportunities in China for outsized returns powered by a large and growing new economy, an established technology ecosystem, and a maturing venture environment with a large and more experienced supply of entrepreneurs, stable capital markets for venture funding, and a variety of exit options,” said Yip during the close of Fund III in 2018.
The new fund adds to the dry powder that venture capital firms accumulated for China. In September, Chinese VC Xiang He Capital closed its second fund at $425 million, exceeding the initial target of $350 million.
Chinese early-stage VC firm Sky9 Capital also announced the close of two new VC funds with a combined $440 million in capital commitments. Fund IV will continue to concentrate on early-stage startups, mostly at Series A and B funding stages, while MVP Fund will focus on growth-stage and break-out companies in the Sky9 portfolio, the firm said.
In July, Walden International, one of the pioneers in venture investing in China, closed its China-focused venture capital fund at just $122.6 million, less than half of its $250-million target.