Every month we handpick 40 financing cases that reveal the hottest trends in China’s startup and tech industry. After health and medical industries prevailed last week, this week saw major investments in sharing economy industries and AI-backed robotic industries. With technological development comes a greater reliance on big data, which contributes immensely to solidifying service, improving user experience, and enhancing customer demands. This is particularly true within the realms of the sharing economy and AI & robotics.
Top 3 investment cases
Among the 40 cases we reported on this month, Tujia, Yidian Zixun, and Horizon Robotic secured the highest financing fundings. Tujia, China’s answer to Airbnb, raised USD 300 million from the country’s leading comprehensive travel service company, Ctrip, and now plans to expand its services overseas. Meanwhile, Toutiao rival Yidian Zixun received USD 100 million for Series E to solidify its content distribution channels. AI startup Horizon Robotic landed USD 100 million, in a round led by chip giant Intel, and aims to develop an autonomous driving system for cars, a major trend in today’s tech.
As salaries and quality-of-life standards improve globally, travel becomes a bigger priority and possibility. Consequently, the quantity and frequency of people traveling around the world will climb. Over the past few years, we have witnessed Airbnb expand globally into a hugely popular property-rental service, one that targets users for various travel options. In China however, the company’s promotional and advertising approach hasn’t proven entirely successful. The company has struggled to understand the Chinese consumer while competitors have gained a foothold in the industry. This month, for instance, saw Airbnb’s Chinese equivalent Tujia win over investors’ favor.
Aside from traveling, consumers now have more spare time for entertainment, learning, and so on. Consequently, the demand for interest-oriented and big-data-based content is increasing. This month we witnessed evidence of this, as news aggregator Toutiao, a rival to Yidian Zixun, secured funding in Series E.
China’s market boasts the world’s largest number of Internet-connected mobile phone users. Naturally, such a great number of users generates a mass of data that can be analyzed and mined in order to meet users’ demands, optimize existing services, and more.
China’s Airbnb equivalent Tujia receives USD 300M in Series E led by Ctrip
Tujia is China’s equivalent to the property-rental site, Airbnb. It provides customers with abundant high-quality and personalized travel accommodation experiences all over the world. It also offers landlords high income and guarantees spare-housing sharing support. Tujia’s services cover family travel, business travel, leisure vacation, party & event space, and transitional accommodation. Users can enjoy 24/7 online booking services via the company’s mobile phone, WeChat, and other platforms. Moreover, Tujia provides tenants with up to RMB 10 million for pre-payment protection funds, ensuring that consumers feel at ease with each booking.
Mobile news aggregator Yidian Zixun receives USD 100M for Series E
Yidian Zixun is an interest-oriented mobile news aggregator with search and recommendation technologies that provide users with personalized content. The company builds user profiles based on big data and other technologies. It acquires professionals to produce content and distribute that content to users based on users’ interest profiles. In addition to that, it rewards professionals whose content attracts large numbers of users and contributes revenue. Additionally, Yidian Zixun builds its own database for marketing based on users’ interests, and can more accurately match users with advertisements.
Embedded AI startup Horizon Robotics receives USD 100M for Series A+ led by Intel
Horizon Robotics is an embedded Artificial Intelligence startup that provides integrated and open embedded Artificial Intelligence solutions that are high-performance, low-power, and low-cost. It designs ‘brains’ for over 1000 devices all over the world, such as autonomous vehicles, enabling them to become intelligent entities that can perceive, understand, and make safety decisions, all the while being convenient and fun.
3 investors to watch
Approximately 80 investors joined in the aforementioned investment cases. Eyeing the hottest sectors were major investors like Hillhouse Capital Group, Legend Capital, and Delta Capital.
Hillhouse Capital Group
Hillhouse Capital Group is an investment management firm founded by Lei Zhang in 2005. Mr. Zhang worked with the Yale’s endowment and a global emerging market fund covering South Africa, Southeast Asia, and China. Hillhouse makes long-term investments, employing a fundamental, bottom-up approach. Hillhouse focuses on consumer, TMT, industrial, and healthcare sectors and invests in companies across all equity stages. Hillhouse manages capital for institutional clients such as university endowments, foundations, sovereign wealth funds, pensions, and family offices.
This month, Hillhouse invested USD 45 million in Lefit, a fitness O2O platform.
Legend Capital is an early-stage Venture Capital and expansion-stage capital investment firm. Legend Capital now manages several USD funds and RMB funds totalling RMB 35 billion. It focuses on innovation and growth enterprises with operations in China or enterprises that are related to China.
By 2016, Legend Capital had invested in over 300 companies, of which over 50 are successfully listed on domestic or overseas capital markets, while around 40 achieved exits through M&A (mergers and acquisitions).
Legend Capital facilitated the vending machine startup Vingoojuice’s unmanned retail businesses, with USD 60 million in the company’s Series B financing round.
Founded in 2010, Delta Capital is a leading growth equity investment fund platform in China. It focuses on early growth equity investment, emphasizing a value-investment approach to achieve the optimal balance between risk and return, maximizing investment results all the while maintaining strong risk control.
Delta Capital has a stable and highly experienced team of over fifteen professionals, who leverage the firm’s extensive operating and investment experience to institutionalize portfolio companies and realize operational improvements.
The investment fund platform led medical imaging platform Huiyihuiying’s Series B in tens of millions of USD.
Throughout the month, investment in property-rental proved the prevailing trend in China.
As more and more people have spare time and disposable income for enjoyable travel experiences, they are less satisfied with traditional travel services with fixed travel plans. For this reason Airbnb’s service has spread all over the world despite encountering obstacles entering the Chinese market. Thus, travel relevant property-rental services and industries are on the upswing. The critical point to their success lies in the fact that they can can better meet customers’ demands for an enjoyable, worthwhile, yet affordable travel experience meanwhile following the latest technology development with high efficiency.
Besides, mobile phone users now have more time with their smartphones, and they want to know the world through its little screen. As a result high-quality news and other content are in-demand. Though we have news aggregator giant Toutiao in China, different users have a variety of interests in news and content that will not be met simply by data analysis. There are other technologies that define users’ interests, and they have proven a good opportunity to pursue.
List of companies that attracted investments in October:
(Top photo from 699pic.com)