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KKR-Incubated Chinese Digital Marketing Firm Cue Closes Series A Round

Cue Holdings Limited, a Chinese one-stop digital marketing start-up controlled by global investment powerhouse KKR, announced on Tuesday the completion of a series A round of financing, as KKR seeks to strengthen the capabilities of the consolidated marketing platform in the segmented Chinese digital marketing space.

Financial terms of the series A round remained undisclosed. The investment was led by Asia Pacific-focused investment company Anchor Equity Partners. KKR, the founding investor of Cue, and Princeville Global, the flagship fund of Princeville Capital, all poured money into the new round, said KKR in a statement released on its website.

KKR made the investment through its third and largest Asia Pacific-specialized fund, Asian Fund III. The fund, which reached the final closing in June 2017, focuses on investments in private equity transactions across the Asia Pacific region.

The completion of the series A round is a "recognition" of Cue as an "integrated solution provider with executional excellence, combining online and offline coverage, marketing and technology advantages, global trends and China insights," said Paul Yang, member and CEO of KKR Greater China, in the statement. He added that the start-up has "excellent prospects" as the enterprise services and digital media industry in China is undergoing "profound changes."

"This capital further helps us solidify our market-leading position at a time when brands are seeking creative digital solutions and data strategies to differentiate themselves and better communicate with their customers," said Sky Shi, CEO of Cue, in the same statement. The company plans to invest in new technologies and a broader range of media with the new funding.

Cue was founded in March 2018 under a partnership between KKR and four digital media companies in China, namely digital advertising agency Qi-xin, digital marketing agency AnG, brand management firm WIN, as well as supply-side platform (SSP) and commercial WiFi operator Wina Tech. The start-up delivers a full suite of digital marketing solutions to clients including consumer brands, financial institutions, online game companies, and internet service providers.

The company said in the statement that it has assisted over 60 brands in China to accelerate their business growth. Its solutions leverage proprietary data sources, collaborations across media channels and formats, and technical capabilities to help clients make "effective, data-driven business decisions."

Proceeds will be also used to enhance Cue’s digital strategies, increase investment in research and development, finance value-added acquisitions, and improve its products and services.

The lead investor, Anchor Equity Partners, operates as a Hong Kong-based private equity fund with over US$3 billion under management. The company focuses on buyout, growth capital, and industry consolidation opportunities in the Asia Pacific Region.