Cathay Innovation, a global venture capital fund affiliated with Sino-French private equity firm Cathay Capital Private Equity, has led a US$15 million series B2 financing round in MagMode, a Chinese men’s fashion start-up.
Chinese venture firm Sinovation Ventures also participated in the round, which follows a RMB50 million (US$7.5 million) B1 round led by IDG Capital Partners in May. The start-up previously raised nearly US$10 million in an investment round led by Ventech China in 2016.
Beijing-based MagMode plays into the popular "consumer upgrade" theme among venture capitalists in China. The company incubates creative men’s fashion designers targeting middle-class consumers. A differentiating feature of the company is that it targets male shoppers, an often overlooked consumer group in China. Female consumers dominate the retail sector, accounting for over 80% of the cosmetics e-commerce market, 70% of the group buying market and 60% of the general e-commerce market.
MagMode was founded by a group of Chinese media and clothing industry veterans led by Cai Chongda, former editor-in-chief at GQ and Modern Weekly in China. The company first opened a concept retail store in Beijing’s upscale Sanlitun district last May. Since then, it has opened a total of 12 stores across China, and plans to open ten new stores each month in the future.
Cathay Innovation closed its debut venture capital fund at US$320 million last month. It plans to invest in 20 to 25 innovative companies in China, Europe and the U.S., with initial commitments between US$3 million and US$15 million.