A Chinese investment firm has launched a new £500 million ($715 million) investment fund specifically for European startups.
London-based Cocoon Networks is a spin-off from China Equity Group, one of the first investors in China’s Google-equivalent Baidu; and Hanxin Capital, a firm with a track record in biotech and cloud computing investments. The ultimate remit of the new fund is to invest in startups “whose products and services show promise and potential for growth in the Chinese market,” covering medical, fintech, biotech, fashion tech, and more. In addition to funding, Cocoon Networks is also launching an incubator space in the U.K. capital.
China has been increasingly looking west for opportunities in the tech realm. In February last year, China’s Tencent moved into Europe with an investment in mobile and online game publisher Miniclip; and a month later, China’s Cheetah Mobile acquired France-based mobile ad company MobPartner for $58 million. Israel is also on the radar of many Chinese organizations and institutions.
Many companies struggle to gain a foothold in the Chinese market due to regulatory and legislative hurdles, with the likes of Google and Netflix facing resistance to their respective services. And circumventing such obstacles will be part of Cocoon Networks’ selling point for startups it invests in.