Tech venture capital firm GGV’s Asia business weighs a foray into private debt after split from US counterpart

Tech venture capital firm GGV’s Asia business weighs a foray into private debt after split from US counterpart

30 Mar Tech venture capital firm GGV’s Asia business weighs a foray into private debt after split from US counterpart

Posted at 08:47h in Asia by

The Asia partnership, which is led by Jenny Lee and Jixun Foo in Singapore, has been rebranded as Granite Asia. Its name comes from Granite Global Ventures, GGV’s original handle when the firm was founded in 2000.
Singapore-based Granite Asia is headed by senior managing partners Jenny Lee (above) and Jixun Foo. Photo: Bloomberg
The firm’s combined portfolio has US$5 billion in investments, and will focus on markets including China, Japan, South Asia, Australia and Southeast Asia. It plans to assemble a private-credit investing team as early as the second half of this year, the people said, asking to not be identified discussing private information.

Private credit, which includes direct lending to companies, is a fast-growing asset class that is becoming a bigger source of funding for businesses from tech start-ups to real estate companies.

Institutional investors and wealthy individuals have been putting more money in private-credit funds, which can make secured or unsecured loans, invest in distressed debt, or structure customised debt solutions for individual corporate borrowers that don’t qualify for traditional bank loans.

In its statement on Saturday, Granite Asia said it intends to expand into other asset classes and markets in the region, without giving details. It added that the plans reflect “the evolving needs of businesses and investors”.

US venture firm GGV Capital to spin off China operations

GGV founding partner Thomas Ng, former GIC president for Special Investments Teh Kok Peng and Teo Ming Kian, former chairman of Singapore’s National Science and Technology Board, will be on an advisory council to guide Granite Asia’s expansion, according to the firm.

Granite Asia will continue to buy stakes in technology start-ups in the region. It is also exploring private hybrid funding, which would involve a mixture of equity and debt, the people familiar with the matter said.

The firm is also likely to wait for at least one to two years before it raises another venture-capital fund, one of the people added. GGV’s last major funding round was in 2021, when it raised US$2.52 billion for four of its funds.

GGV’s US partnership will be known as Notable Capital, according to the statement on X. The US firm will be led by managing partners Glenn Solomon, Hans Tung, Jeff Richards and Oren Yunger. It will invest primarily in the US and Europe.

Notable Capital will be led by managing partners Hans Tung (above), Glenn Solomon, Jeff Richards and Oren Yunger. Photo: SCMP
Sequoia Capital broke up into three entities focusing on China, India and Southeast Asia, and the US and Europe, respectively. Sequoia’s US firm kept its name, while the China partnership is now called HongShan Capital and the third entity is called Peak XV Partners.
The biggest global venture firms have long managed investments across the Pacific, deploying funds raised from US endowments, pensions, global sovereign wealth funds and other institutions into lucrative internet and technology companies in the world’s two largest economies.

In the past year, politicians and regulators in Washington and Beijing have amped up scrutiny of cross-border tech investments, making it increasingly hard for venture firms to navigate a changing geopolitical landscape.

Biden limits US investments in China tech, makes ‘emergency’ declaration

In August, President Joe Biden signed an executive order limiting US investment in some Chinese firms, part of a push to restrict the country’s ability to develop next-generation military and surveillance technologies that might threaten US national security. The order regulates US investments in some Chinese semiconductor, quantum computing and AI firms.

With governments increasingly scrutinising how companies handle data and where they get funding from, investors in cutting-edge technology and biotech firms have had to set up firewalls between different regions.

As part of GGV’s split, the US and Asia operations have localised and separated data storage for different geographies to ensure they comply with local government requirements, one of the people said.

GGV’s legacy funds will remain in operation, and their undeployed capital will be invested in existing portfolio companies and new opportunities, the people said. In mainland China, GGV’s yuan-denominated funds will continue to operate independently under the Jiyuan Capital brand led by Eric Xu, GGV said earlier.

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