Lightspeed sets sights on Chinese startups with $560m fund

Sian Bradley's picture
This is Lightspeed's fourth fund in China

Global investor Lightspeed has closed a $560m fund for Chinese internet challengers - the largest investment to date.

This is the fourth fund that New York based Lightspeed has dedicated to Chinese firms. Initial calculations predicted that the fund would close at $360m, but more capital was added to have more variety in potential partnership choices. 

The total fund is being split, with $360m earmarked for Series A and Series B stages, whilst the additional $200m has been set aside for “growth investments.”

Lightspeed Venture Partners has a presence in  Silicon Valley, Israel, China and India; which means they seek out companies with potential to expand internationally.

It counts more than 300 companies in its portfolio; a third of which have either IPO’d or been acquired. In fact, in 2018 alone, five of its partnered companies held IPOs. This included two Chinese e-commerce startups; food-delivery service Meituan and group-buying platform Pinduoduo.

Meituan raised over $4bn when they IPOd in Hong Kong last year, whilst Pinduoduo raised $1.6bn via a U.S. listing. The Chinese branch of Lightspeed is ran by Chris Schaepe, Herry Han and James Mi.

Founding partner Han said in a statement: “Innovation and entrepreneurship in the next decade will bring more China-based startups to the world stage. This will be China’s first decade of truly global innovation. Chinese entrepreneurs are now developing business plans with global expansion in mind from day one.”

This latest fund is the biggest of its kind. In 2013 Lightspeed made its debut fund in China at $168m, followed by two funds closing at $260m each.