Legend Capital develops as leading local VC firm
By Wang Xu (China Daily)Updated: 2007-03-28 14:40 Since its establishment in 2001, Legend Capital, a sister company of China's largest computer maker Lenovo Group, has been recognized as one of the most active venture capital (VC) firms in the nation.
In the past six years, the Beijing-based company has invested in nearly 50 start-ups, while the total fund it manages has grown from an initial $35 million to about $300 million.
Despite agreeing with the tag of "an active VC", Zhu Linan, managing director and CEO of Legend Capital, prefers to interpret the concept in a different way.
Unlike some other VCs that rely on readily available
business proposals for investment opportunities, Zhu Linan and his colleagues
have adopted a more proactive and systematic approach to find new companies.
They try to identify the most promising segments in China's information
technology (IT) sector and then approach a few of the leading start-up
companies.
Upbeat about China's potential to become an outsourcing destination, Legend Capital conducted a comprehensive study of all related sectors in China in 2001, ranging from outsourcing companies for software, business procedures, human resource management and medical applications.
Then SinoCom Software Group Ltd, a Beijing-based outsourcing company, came into the venture firm's sights. In March 2003, Legend Capital invested around $3 million in SinoCom and secured a six-fold return from its Hong Kong listing just a year later.
As a venture capital firm focusing on earlier stages of investment, Legend Capital manages an amount of $300 million in three funds. Given the size of the fund, the company has a seemingly bulky team of 25 professionals. Currently, only IDG Technology Venture Investment has a group of comparable size in China, but it manages $800 million for investment in the nation.
Yet, Zhu still reckons people are the biggest challenge for him, as his team is still too small to meet his ambitions. The six-year-old VC firm aimed to become a top player in China's venture capital industry since its inception and $300 million will just be a start, he says.
Zhu, a 45-year-old fast-talking Suzhou native, spoke in his office to China
Business Weekly reporter Wang Xu.
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