The closing months of 2016 have been kind to Qiming Venture Partners. The US$2.7 billion-under-management Chinese venture capital firm saw three of its portfolio companies list in public markets during the past month: in Shanghai, Taiwan and Hong Kong.
Meitu Inc., a phone retouch app and smartphone maker backed by Qiming, IDG Capital and others, was valued at HK$35.9 billion (US$4.6 billion) following its Hong Kong IPO. It was the biggest IPO by a technology company in Hong Kong since Chinese tech giant Tencent Holdings Ltd. went public in 2004.
The IPO marks the latest high point of a "harvest season" Qiming has entered to cash out of investments made over the past decade, says JP Gan, Qiming's managing partner. The firm just celebrated its tenth anniversary with a lavish party in Shanghai's Ritz Carlton featuring U.S. swimmer Michael Phelps and Chinese national volleyball coach Lang Ping. Now into the second decade, Qiming must identify the industries from which the next great Chinese tech companies will emerge.
Not surprisingly, the sectors cited by JP Gan included artificial intelligence (AI), virtual reality, Internet-of-Things (IoT), all of which are the buzzword in today's venture world.
For artificial intelligence, Gan likes mission-specific products that can be commercialized quickly, such as voice recognition, image recognition and driver-less cars.
In terms of VR and AR, he believes the hardware platform will evolve away from head-mounted goggles to something more user friendly. As for big data, he thinks Chinese start-ups in that field face greater challenges than their U.S. peers as the country's technology giants typically like to do things in-house.