Qiming Venture Partners, an early investor in major tech firms such as Meituan and Xiaomi Corp, is aiming to raise approximately US$800 million (RM3.5 billion) in response to a revival of interest in Chinese AI startups, as reported by sources close to the situation. The fundraising initiative is set to have a ceiling of US$1 billion, according to these sources, who requested anonymity due to the confidential nature of the matter. They also noted that the plans are still in the early stages and could undergo changes. A spokesperson for the fund declined to provide any comments.
Under the leadership of founding managing partners Gary Rieschel and Duane Kuang, Qiming is among a select group of US-dollar funds focused on China that are actively looking for investment. While the potential of DeepSeek to develop efficient and cost-effective AI models has attracted attention from investors in China, many US pension funds and endowments are still hesitant and have not yet committed substantial investments to the region. In the past year, 11 US-dollar venture capital funds based in China raised US$1.3 billion, representing 28% of the total funding in the Asia-Pacific region, according to Preqin. This contrasts with 62 funds that raised US$17.2 billion—60% of the regional total—in 2021.
Simultaneously, several funds in China are facing challenges in deploying their capital due to a lack of appealing investment opportunities and a tough exit landscape. Some are in discussions to extend their investment periods to allow more time for capital allocation and to identify better exit strategies, which raises concerns about potential misalignment of interests between fund managers and investors. Despite this, China has produced a surge of AI models that are beginning to challenge US leadership, including Alibaba Group Holding Ltd’s R1-Omni and Qwen models, Manus AI’s agent, and Tencent Holdings Ltd’s enhanced reasoning model.
Since its inception in 2006, Qiming has raised US$9.5 billion and witnessed 12% of its approximately 580 portfolio companies go public, according to its website. In 2022, it secured US$2.5 billion through its Qiming Venture Partners VIII LP fund to invest in sectors such as consumer discretionary, healthcare, and technology.
