Xiang He Capital, a California-based venture capital firm, is raising a $350-million second fund to invest in technology, media, and telecommunications (TMT) sector in China.
Based on Xiang He’s US Securities and Exchange Commission filing, Xiang He Fund II LP seeks to be larger than the firm’s $261-million debut fund, Xiang He Fund I LP, raised in 2017. The inaugural fund had a target of $300 million.
Details about the second fund were not immediately available but the debut VC fund specializes in growth capital investments, with a focus on China’s TMT sectors.
Portfolio companies include online education startup VIPKid, on-demand delivery company Lalamove, video streaming provider iQiyi and bid data analysis firm Sensors Data.
The venture capital firm was founded by Hesong Tang, a former Vice President at Baidu who was in charge of strategic M&A and investments at the Chinese firm. Notable deals he led at Baidu include the $1.9-billion acquisition of 91 Wireless, the $306-million controlling investment into Qunar, investment into iQiyi, the $370-million acquisition of PPS, and acquisition of Nuomi.
Prior to Baidu, Tang was the Director of Strategic Investment at Microsoft Greater China. He has previously worked at Cisco and Applied Materials.
In the first nine months of 2017, TMT deals in the mainland and Hong Kong totalled $53.7 billion, covering 233 mergers and acquisitions, according to Mergermarket.
The number and amount of TMT transactions in the January-September 2017 period, however, were lower than in the same period in 2016, when 257 deals on the mainland and Hong Kong generated a total of $718 million.
The $9.2-billion partial privatisation of China Unicom’s Shanghai-listed parent has emerged as the biggest deal recorded in the TMT sectors of the mainland and Hong Kong between January and September 2017.