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Baidu kicks off its USD 3 billion fund for tech investment

Chinese tech giant Baidu has set up its massive new investment fund, Baidu Capital, on Wednesday. Baidu Capital will mainly invest in companies in the Internet sector.

Baidu Capital will be an independent market-based fund, scaled at a mighty RMB 20 billion (USD 2.9 billion). According to Baidu’s page on Weibo, China’s largest social network, the fund will recruit two or three managing partners from investment and internet business circles to direct the fund.

According to Baidu’s Weibo, Baidu Capital will mainly invest in mid and late-stage projects in the Internet sector, using both RMB and USD, with investment sums ranging from USD 50 million to 100 million.

Baidu Capital’s sources of capital will include a number of insurance funds, security companies, mother funds of some professional institutions, and government-backed investment institutions.

Baidu set up Baidu Venture, its venture capital unit, on September 13, arming it with USD 200 million in the first phase of investment. Baidu Venture focuses on early-stage projects in areas including artificial intelligence (AI), virtual reality, and augmented reality (VR/AR).

Baidu, Tencent and Alibaba (BAT) are seen as the three major tech giants in China. Their competition can also be seen in investments they have made.

According to a report by news portal NetEase on Wednesday, BAT have invested a total of RMB 415 billion in China since 2011. Specifically, Tencent has invested in 311 projects, followed by Alibaba’s 171 and Baidu’s 96, during the same period of time.

Baidu seems to have fallen behind the other two in terms of the number of investments it has made: this may explain why Baidu has rushed to set up two independent capital funds within one month.

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