Sequoia China raises $9 billion amid hopes crackdown is easing -source

HONG KONG, July 6 (Reuters) – Sequoia Capital China has raised a complete of almost $9 billion for 4 new funds amid investor hopes that the authorities are easing a regulatory crackdown on the tech sector, stated an individual with direct data of the matter.

The newest fundraising by Sequoia China, which in response to the individual initially focused no less than $8 billion and was 50% oversubscribed, underscores how world buyers are relying on main funding managers to chop offers in China’s new economic system industries following the unprecedented crackdown.

Sequoia China, extensively considered as a bellwether for Chinese language tech funding, launched the fundraising early this yr and has attracted commitments from buyers in the USA, Europe, the Center East and Asia, together with pension funds, sovereign wealth funds and college endowments.

Sequoia China declined to remark. The individual with direct data of the matter declined to be recognized as the data isn’t public. Information of the fundraising was first reported by information web site The Data.

The 4 funds will primarily spend money on Chinese language start-ups at totally different levels of their life cycle, with a concentrate on the know-how, healthcare and shopper sectors, stated the individual.

Authorities in late 2020 began to rein within the homegrown know-how sector with a marketing campaign that unfold to different industries, which wiped billions off market capitalisations and stalled start-ups’ abroad listings.

The crackdown additionally compelled world buyers to drag again or put commitments to China-focused funding managers on maintain, leaving many struggling to boost new funds.

China-focused enterprise capital and personal fairness companies raised solely $4.3 billion in U.S. dollar-denominated funds within the first half of 2022, a far cry from the $26 billion in the identical interval final yr, in response to information supplier Preqin.

However the authorities have in latest months modified their tone and tack in the direction of the regulatory crackdown campaigns, as they search to spice up an economic system damage by COVID-19 lockdowns.

The shift in messaging has raised hopes for firms and buyers that the worst is over, although jitters stay. learn extra

Sequoia China was based in 2005 by former banker and entrepreneur Neil Shen, now one among China’s best-known enterprise capitalists.

As an early investor in prime Chinese language tech companies akin to Alibaba, Sequoia China has greater than 900 portfolio investments together with TikTok proprietor ByteDance, ride-hailing main Didi International and meals supply large Meituan.

Reporting by Julie Zhu; Modifying by Robert Birsel

Our Requirements: The Thomson Reuters Belief Rules.