Suzhou VC fund to raise RMB800m

Suzhou's latest fund will invest at least half its capital in the Chinese city of Suzhou and will target pre-IPO technology companies.

Financial services group Quam and state-owned Suzhou High-Tech Venture Capital have teamed up to raise Suzhou Quam-SND Venture Capital, a venture capital fund targeting RMB800 million ($117 million; €84 million).

The fund will be managed by Suzhou Gaohua Venture Investment Management, a joint venture in which Quam has a 51 percent stake and Suzhou High-Tech Venture Capital has a 49 percent stake.

Quam intends to raise RMB51 million for the fund and Suzhou High-Tech Venture Capital, a government-backed management group, plans to raise RMB49 million, Chris Choy, general manager of Quam's venture investment business, said in an interview.

The fund plans to hold a first close on RMB100 million this September. After investing RMB70 million, it will then continue to raise funds from investors in Europe, the US, the Middle East and Japan.

At least half the fund’s capital will be invested in Suzhou, a city that sits next to China’s Yangtze River in Jiangsu province. Suzhou New District, in the west of the city, is a specially designated zone for technological and industrial development in the country.

The fund will invest between RMB10 million and RMB20 million in growing technology companies and aims to list them within two years. The fund will target sectors such as energy, resources, services, environmental protection and agriculture.

Based in Hong Kong and listed on the Hong Kong Stock Exchange, Quam provides financial services such as retail and institutional securities trading, corporate finance, asset management and wealth management. The group sees China as a core market focus and allocates most of its resources to expanding in the region, according to its website.

Suzhou High-Tech Venture Capital is owned by the administrative committee of Suzhou National New & Hi-Tech Industrial Development Zone. It aims to establish a platform for local and foreign venture capital investments by financing growing technology companies.