SINGAPORE, Dec. 15, 2022 /PRNewswire/ -- Chinese entrepreneurs are ready to go global, said Zhou Wei, Founding and Managing Partner of CCV, in a key panel at the 35th AVCJ Private Equity & Venture Forum held in Singapore recently.
"We have been facing dramatic past three years," Unstable as the market has been, Zhou emphasized that he still held confidence in companies with solid foundations. "These companies have a solid foundation and a clear leading position."
He mentioned that five of the CCV team's investment portfolio companies filed for IPO in 2021 and two companies went listed respectively in Hong Kong and New York in 2022.
Zhou invested in Arrail Dental (HKSE:6639) in KPCB China, where he served as a managing partner and led the technology investment. Another listed company he mentioned is Perfect Corp, a leading company in AI beauty. CCV is the first institutional investor of Perfect in its early stage.
He said as long as companies create real value and become the leader in their sectors, they could survive the market's ups and downs.
As for the external changes, he said that investors should not be disturbed by noises but look at fundamentals.
"In an uncertain world, what should we do? We look for certainty. I saw a lot of certainty in China compared to 15 years ago. First, China has accumulated and built strong strengths and competitive edges in many ways after 40 years of fast economic growth."
"A complete supply chain that took years to build does not exist in any other countries. Today nearly all technology startups need to combine different technologies and need different suppliers and talent," said Zhou
CCV has been investing in "zero-labor" companies, Zhou said. "To make a final product, these companies need to combine artificial intelligence, autonomous driving, and robotics including many hardware, sensor, chips, and other components."
Only two countries in the world can provide such a supply chain and technology and talent pool for startups, said Zhou.
In an earlier interview with AVCJ, Zhou said that the biggest opportunity in China today lies in the shift from the mobile-internet era to the intelligence era. China has a competitive edge globally because no other country excels in the combination of AI, autonomous driving, and robotics.
He said that US dollar funds could back Chinese entrepreneurs who want to go global and help them expand into new markets.
The second certainty, according to Zhou, is from the long-term competition lessons learned and innovation experience of Chinese startups and entrepreneurs in the highly competitive market of China.
"Chinese startups went through from 'copy to China' to 'innovate from China, to 'create from China, and entrepreneurs learned their lessons in real competition. I believe they will be able to define the next generation of products".
The entrepreneurial spirit is strong as well, he added.
The third certainty, he said, is about the new generation of entrepreneurs, who would not focus on the Chinese market solely.
"In the past 20 years, despite hearing so many stories of Chinese startups booming, we saw most of those companies operating in and targeting mainland China. But today we see a growing number of founders starting their businesses in the global market from day one."
Zhou gave the example of Transsnet Financial, Africa-focused payments and digital bank platform that CCV invested in in its early stage. Spun out from Shenzhen-based mobile phone manufacturer Transsion, the company Zhou referred, was started by experienced founders and eyeing global markets rather than China. Perfect (NYSE: PERF) also started its business globally rather than focusing on a single market, added Zhou.
Except for Transient Financial and Perfect, Zhou also invested in the Asian Innovation Group, a Singapore-based mobile social platform in emerging markets that boasted over 400 million registered users in over 150 regions worldwide.
Zhou said that globalization would be a keyword in the future ten years for Chinese entrepreneurs. He compared what Chinese companies are experiencing with Japanese companies in the 1970s when Japanese companies went global and became world leaders in sectors like automobiles, ships, and industrial robots. Today Chinese companies possess competitive advantages in vertical sectors like automated cars, chips, and different components.
"These certainties give us confidence that once the COVID situation gets better, we will see a new wave of startup companies and value creation in China and globally. I believe Chinese entrepreneurs could define the next generation of global products and brands," said Zhou.
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