Eric Xu, a managing partner at GGV Capital, talked to China Money Network on where he sees great opportunities in venture investing in China right now.
Xu joined GGV Capital earlier this year, and was most recently managing director at SIG Investment Asia where he led investments in the consumer Internet and frontier tech sectors. Before SIG, he was an investment professional at CITIC Capital and TDF Capital. Before entering venture capital, he was an investment banker at CLSA and its joint venture in China.
Q: You just joined GGV Capital earlier this year, what are the sectors that you are focusing on?
A: The first sector we are looking at is consumer e-commerce. The market of e-commerce in China is really massive, and it has evolved from the Internet to mobile Internet. There have emerged different business models and (different applications).
The second one is the business-to-business sector, especially in two different aspects including software-as-a-service (SaaS) and the SaaS model circulated around transactions.
The third sector is Internet digital media, like social media platforms that are connected with the young generation. The forth one is frontier technology including Internet of Things (IoT), artificial intelligence, augmented reality, and virtual reality.
Q: Do you agree with what some industry veterans say that the mobile Internet era has entered into the second part where one won't find great investment opportunities any more?
A: No, I don’t think so. I think the pure mobile Internet era has nearly finished but there are still a lot of opportunities within vertical industries. In China, each sector is huge, when we talk about the market size of each vertical, it is around trillions of RMB, like the real estate and automobile sector.
Last year, the venture capital industry focused a lot on the online-to-offline (O2O) sector, and we were talking about when and how the mobile Internet will be applied in people’s daily life. This year, I think there will be a lot of synergy among different industries.