Cathay Capital inaugurated the Sino French Innovation Fund at an official launch ceremony at CEIBS Beijing Campus last week along with CDB Capital and Bpifrance.
As one of the new investors who have confirmed their contribution, Valeo, a leading automotive supplier, will partner with Cathay to reinforce its access to innovative startups in smart transportation and connected car applications. In addition, Cathay announced it will donate 500,000 Euros to CEIBS to set up the Cathay Global PE Research Fund.
In July this year, during the Chinese Prime Minister’s state visit to France, cornerstone investors Bpifrance and CDB Capital signed an investment agreement with Cathay Capital, who will manage the Sino-French Innovation Fund. The fund – which has a 250 million Euros closing target – is a new cross-border investment vehicle active across France, China and the United States and is dedicated to venture capital financing for innovative startups, marking a milestone in Sino-French private-equity (PE) investment. By leveraging its global network to benefit the most innovative companies, Cathay Capital will adopt an investment strategy to boost the development of selected companies across each targeted geographic zone by fostering dialogue and partnerships between them.
Building on the success of the Sino French Fund created in September 2012, and the Sino French (Midcap) Fund launched in 2014 (both supported by Bpifrance and CDB Capital), the new fund will target investment in digital startups linked to the internet, including mobile, big data, ‘the Internet of Things’, smart transportation, connected cars, advertising, digital marketing, software, cloud technologies, security, gaming, media, social networks and BtoB applications. It will invest in a total of 12 to 18 innovative startups and the investment amount in each firm will range between 5 million and 25 million Euros. This also goes to demonstrate that Cathay Capital’s investment focus is extending from growth and M&A capital to broader areas such as venture capital.
To lead this new value-added solution specifically designed for entrepreneurs leading the mobile internet revolution, Cathay Capital will benefit from the experience of Denis Barrier, who joins Cathay as Co-Founder and Managing Partner of the Cathay Sino-French Innovation Fund. Denis Barrier has a strong expertise in venture capital, and in helping startups boost their development across various geographies while striking strategic agreements with large corporations.
Meanwhile, the Cathay Global PE Research Fund has been co-created by Cathay Capital, CEIBS and other top business schools. And it aims to promote the study of trends, cases and risk-reward models of global PE investment, as well as innovation in the industry, organizational structures and management patterns in the new economic environment. All faculties from these top business schools are eligible to apply for the fund and the results of any research will be shared with the public.
Haibin Fan, President of China Development Bank Capital, says: “In light of the existing PE cooperation between China and France, and the vision of supporting the development of innovation firms, we are thrilled to enter into collaboration for the third time with Bpifrance and Cathay to launch this fund. It heralds an important step in the Sino-French partnership in financial investment; it will accelerate the international growth of targeted firms and help them make significant breakthroughs in cross-border cooperation.”
Nicolas Dufourcq, Chairman of Bpifrance, says: “We are pleased to celebrate the launch of the new fund with CDB and Cathay. Given that French companies have an urgent need to develop their activities across as wide a market as possible, this potential is something offered by the United States, but also today by China, and we have huge confidence in the investment prospects of the fund. On the back of the successful results of the Sino French SME Fund and Midcap Fund, we are confident that the new vehicle can continue the dynamic ofcreating economic growth and employment in today’s economy.”
Jacques Aschenbroich, CEO of Valeo, says: “Our cooperation with Cathay will bring a key new stone to our open innovation policy, which we have conducted over numerous years. As a leader in driving assistance systems, Valeo is deeply committed in providing the technologies for cars that will be more autonomous, connected and intuitive. This partnership with Cathay will reinforce our ability to cooperate with innovative startups on three essential geographies for the automotive market, in China, in Europe and in the United States, in a context where the automobile is becoming more and more digital and connected.”
Mingpo Cai (pictured), President of Cathay Capital Private Equity, says: “We are delighted to witness the launch ceremony of this innovation fund with our partners Bpifrance and CDB Capital and we wish to thank them for their continued support. By leveraging our 8-year cross-border experience and the sheer depth and breadth of our network across China, Europe and the United States, we will fully support the global deployment of this fund. In the new era of the Internet economy, innovation has a huge impact on economies and business models, and Cathay has been preparing an 'Innovation vehicle' to meet the needs of this new era. The Cathay Capital team will be further strengthened in the context of this fund launch, mainly by setting up a dedicated line of activity in order to better serve our entrepreneurs and fully deserve the confidence and trust of our investors.”
Yuan Ding, Vice President and Dean of CEIBS, Professor of Accounting, says: “We deeply appreciate the continuous support of Cathay Capital, a company led by our alumnus Mingpo Cai. In today's rapidly changing and challenging world, the study of PE and related areas urgently needs an emerging force to help guide it. The establishment of the Cathay Global PE Research Fund will enhance knowledge creation and dissemination of PE by linking East and West in teaching, research, and business practices. We also have great faith in the development prospects of the innovation fund and believe it will create a healthy environment for innovative startups to grow.”
