Investment, People, Life | 5Y Capital Pub Vol. 7 x This Is Sound Life
A serendipitous journey, moments that left me in awe of founders, and bits of life along the way.
5Y Capital Tavern Notes
Most of the time, founders and investors meet in conference rooms, discussing serious matters about industries, companies, and markets. But beyond our professional identities, as people living in the same era, what are we actually like in life? What do we care about, love, and worry about?
This episode of our tavern series is a special collaboration with Agora's podcast "This Is Agora Life." We hope to bring you an episode full of everyday warmth.
In this conversation, 5Y Capital's Kai Liu, Shunwei Capital's Zheng Feng, and Agora's strategic investment director Yipu Zhu talked about how they stumbled into the industry, moments when founders left them in awe, deals born from walking-and-talking, and life beyond investing — about investing, but even more about living.
We also invite you to scan the QR code at the end to listen to the audio version of this episode.
Guests at this week's tavern:
Hosts of "This Is Agora Life":
Cynthia, Senior Director of Agora Startup Ecosystem
Austin, Investment Manager at Agora Strategic Investment
This episode's guests:
Kai Liu, Partner at 5Y Capital
Zheng Feng, Vice President at Shunwei Capital
Yipu Zhu, Director of Strategic Investment at Agora
What they talked about:
- Stereotypes about VCs — first of all, that they're all extremely good-looking.
- Some deals really do come together during a walk.
- The seemingly freest job is actually the least free.
- Investors serve founders; there's no need to only share good news.
Originally planned to raise money and start a company, but ended up in investing by accident.
Cynthia: How did everyone choose to enter the investment industry? What led you here?
Kai Liu (Levi): I went to college in Hefei, and a VC firm came to campus recruiting interns. They told us what VC was like in America. That was my first real-world contact with VC — I'd only read about it in books before, and I found it fascinating. It planted a seed.
After graduation, I worked at internet companies for many years, as both a PM and an engineer. Later, during the O2O wave, I planned to start my own company. I asked people which VCs were reliable, and they introduced me to a few. Little did I know that one conversation would be the beginning of a completely different story.
I was trying to raise money for my startup, but after talking, they said my entrepreneurial skills weren't fully developed yet and many of my ideas were off. I was earnest about it — I thought VCs were mysterious and must hold the secrets to building unicorns. They said they did have many secrets, and suggested I come learn by doing investing first. By a twist of fate, that's how I ended up in this job.
Zheng Feng: I got into VC through running a Weibo account. 2011 was the golden era of Weibo. I was studying engineering at Yale but was fascinated by this new thing. I created an account called "New York Foodie." I remember vividly: after registering, I followed 200 New York accounts, and because of the name, 30% followed back the next day.
At first I just reposted content, and eventually had several hundred thousand followers. After graduating, I worked in the US for two years as a data analyst, but my side hustle was running these repost accounts — from food to travel, and finally discovering that shopping guides made the most money. At peak, I hired many people to run various account matrices.
In 2013, the VC industry wasn't as competitive as it is now — there wasn't this feeling that every talented young person wanted to get into VC. But because I'd done these things and genuinely enjoyed them, I directly messaged people on LinkedIn. The boss who hired me gave me a chance, and my first job after returning to China was joining IDG.
The highs and the lows.
Cynthia: You've all been investors for quite a while now. What's been the biggest sense of accomplishment? Any psychological letdowns?
Zheng Feng: The biggest accomplishment is definitely seeing a project go from relatively ordinary to influential in a relatively short cycle. Also, you're always at the forefront of society, working on things before everyone else is talking about them — that's lucky in itself.
The letdowns are when you invest in a bad project, which is painful. Another part is when you invest in a great project — you have to face the relationship with the project, or the gap between their wealth growth and yours. Everyone handles it differently. For example, I actually went and started my own company. In the end, everyone is exploring what they truly want, making choices between risk and commitment.
Kai Liu: Investors mostly stand behind the scenes. The good and the bad are mainly faced by the founders.
We probably all share an obsession: an underestimated, unloved person or company that, through your guidance, transforms and succeeds, even growing into an industry giant that affects many people.
It's the hero's journey you see in Hollywood films — the most dramatic kind where one person sets out, everyone opposes them, but one person supports them, and eventually they find their mission and return as a hero. Investors probably have a soft spot for this deep down, and early-stage projects tend to produce this kind of narrative.
Cynthia: Was there a psychological letdown when you first entered? Did it seem glamorous but turn out different?
Kai Liu: I actually started a company as an undergrad. After meeting VCs on campus, we started an online education company in Hefei. Since most people at USTC went to study in the US, but Hefei lacked foreign teachers, learning English was hard. I brainstormed with classmates and came up with online tutors from the Philippines and Southeast Asia. In 2007, we were probably among China's earliest online education ventures. Later, not really understanding the business, we shut it down and sold after graduation.
The letdown came from my vague impression that VCs had several labels. First, they were all extremely good-looking. I remember the two people from that VC who came to campus recruiting were in full suits — we were students who'd never even seen suits. Second, they all had elite degrees, apparently one from Harvard and one from Stanford.
But when I joined Morningside Capital (5Y Capital's predecessor), nobody managed me. After onboarding, they gave me an IBM laptop. I thought, I used a Mac at my previous job, why an IBM? They said it was for making PPTs. I said, oh, okay, but the letdown was huge.
Austin: Hearing you had to make PPTs — even bigger letdown.
Cynthia: Sounds very dramatic. Yipu probably didn't have this kind of letdown — seems like you've always been on the professional services track.
Yipu Zhu: Investment and banking-type jobs have been packaged quite a bit by media. But as one joke goes, the world's three biggest professions — sales manager, product manager, investment manager — even when you make partner, you're still an investor. You have to do lots of research, talk to projects yourself, with plenty of blood, sweat, and tears behind the scenes. It's not that glamorous.
If it's a consensus project, it doesn't show how good you are. Everyone's chasing things before consensus forms, discovering them early. Finding something that becomes consensus through this anti-human, non-consensus process — that's very rewarding.
Cynthia: Investing may differ from other work in that feedback and returns don't come immediately, with significant risk and leverage in between.
Austin: You need to wait a very long time for feedback. But once it comes, it's usually clear, direct, and massive — though not necessarily positive feedback. It could be negative feedback, getting beaten up across multiple markets continuously.
The first time I met him, I was shocked.
Cynthia: You've all been investors for so long. Are there any founders who left a particularly deep impression, where after talking with them, you felt they influenced you more? Anyone whose face comes to mind immediately?
Kai Liu: This wasn't a project I directly invested in. When I first joined VC, I helped out on a project our firm had that was nearly dead — Kuaishou, which couldn't raise money at the time. Tencent had met with them and passed, but we wanted to try again. In 2014, I went with Hua Su to meet several Tencent SVPs.
The first time I met Hua Su, I was shocked. He was wearing slippers and a t-shirt, carrying a Swiss Army computer bag. The t-shirt looked like he'd worn it for ages — the kind I wore in school too, where the collar's almost at your shoulders. He looked half-asleep. We bought coffee downstairs, then went up to meet these suited Tencent executives.
But the moment he entered that conference room and opened his laptop to talk about his startup, he just started glowing — his eyes, his whole aura. He didn't care about other things, but the moment he talked about his company and his startup, he radiated light from within.
I'm not religious, but I later wondered, is this what people mean by a true believer — shining with this faith from within? I didn't even understand what Kuaishou did at the time, but that feeling made me think this founder was different.
Zheng Feng: Levi mentioned a big shot; let me mention an earlier-stage one. It's a relatively early project that both we and 5Y invested in, called ACE Virtual Singer. The CEO is Jing Guo. I knew him through many rounds, only investing relatively late, but I kept thinking about him through all those rounds because the impression was so deep.
As Levi said, eyes shining with light — what moves us most is a founder's love for their endeavor. He played in bands as a kid, then built a virtual music app. At first people said it didn't sound good, others said he could do other things. When I first met him, I suggested virtual humans, but he insisted his love was music, kept going down that path, iterating continuously, making it sound better.
Once during a discussion, someone asked: isn't music always head-heavy, like we all listen to Jay Chou? What's the point of UGC music? I thought this was a professional question that obviously suggested it was useless. He replied: actually, music's distribution is tied to its presentation. Jay Chou is popular because we all listen on QQ Music, but years ago, music presentation might have been hiring a band to come to your home — classical music was the pop music of its time. If we experience music in virtual spaces in the future, that music may also differ from today's.
A founder's love for something can also give you that soul-shaking feeling. That's what makes early-stage investing so exhilarating.
The freest, and the least free.
Cynthia: We talked a lot about career-related things. Can we chat about something more personal, like daily work hours and intensity?
Kai Liu: My first six months, I particularly couldn't adapt to VC's no-punch-clock system. Before, I had a fixed morning route, clear daily tasks. After joining VC, nobody set metrics for me, nobody cared when I came in. I remember when I first started in Beijing, I'd go to the office extremely early — when the building opened at 8:30, I'd be there, and find nobody all morning.
I spent quite a while adapting to this. As a philosopher said, giving you the greatest freedom actually makes you the least free. When nobody arranged my work, I was actually the most uncomfortable — I had to fill every hour.
Over time I developed habits: waking very early, around 7am, but sleeping late, around 1am. Though I love solitude, I also love meeting people — probably four or five meetings or calls a day. I'd also set aside one or two hours daily for reading research reports, blogs, and news.
When I worked at internet companies, I came early and left late, but probably spent more than half the time in meetings. I've calculated that VC's effective work hours are much longer, but more fragmented — even lunch with someone is work talk.
Zheng Feng: I think Levi put it very well. This job's biggest characteristic is that it's supposedly very free, but on the other hand, you're actually thinking about work 7 x 24, with no off switch.
It may relate to career stage too. When you're new, following a boss, there are relatively more passive tasks. I remember vividly, just back from the US, I couldn't adapt — in American work culture, nobody contacts you after hours. Then I'd get calls from my big boss in the middle of the night, jolting awake in bed, very anxious.
Slowly adapting, I gained more of my own time. I think people in this industry basically divide into several work styles: project flow (seeing many projects), social flow (knowing all the intel). Mentally, I'm very entrepreneurial, belonging to the CEO flow — as Levi said, if suddenly idle, I'd think which CEO I haven't contacted in a while and reach out. That's my preferred work style.
Another piece is information acquisition: anchoring to where the top information sources are. When I first started, I even wrote Python programs — back when everyone registered for Weibo, I'd grab a group and see who they all followed that week. This is the technical flow, though this technical flow is completely defenseless against the social flow.
Yipu Zhu: Actually starting from consulting, I've been in a fairly free time situation, but also very unfree, because work and life aren't separable — rarely any absolute division of on/off hours. No punch clock may not necessarily be a good thing.
I feel investing-type work requires pretty strong time management, because there's lots of fragmented time to organize. Like Zheng Feng also spends time with kids, right? You definitely have to become a time management master.
Exercise breaks the body's shell; breaking through the self is fascinating.
Cynthia: Everyone's quite busy with work. Levi wakes early, Yipu probably does too. In such a fast-paced life, do you require yourself to exercise? The stereotype of Silicon Valley investors is discussing deals on treadmills. What's everyone's view on exercise?
Yipu Zhu: I think whatever the job, in the end it's a competition of physical condition. Not about deliberately exercising, but maintaining good movement really helps thinking. My feeling is, if every day your body feels weak, your energy and focus probably can't concentrate either.
Zheng Feng: I exercise quite a bit. I think whether Chinese, foreign, humans are fundamentally no different — just different life stages. At a certain stage when you feel health matters more than anything, exercise becomes natural.
Why do we love eating? Of course eating is relaxing and joyful. Is it also because earliest, everyone came from periods of not having enough food, so eating felt like a good thing? In my priorities, inviting someone to walk and chat about projects is the least formal, most intimate gesture, right? I actually do have deals that came from walking talks.
Cynthia: Levi exercises a lot, right? You also do boxing.
Kai Liu: Yes, I like trying all kinds of sports. We fear others' criticism, have self-esteem — this is the spiritual shell. The physical shell matters too. When I first started Muay Thai, I was very unadapted: two people sweating, necks twisted, tangled together. The coach said this is ground striking. Why aren't you learning properly? I said I just can't adapt to being this entangled with a man.
Beyond improving fitness, training is actually about breaking the self — I find this process fascinating. We always feel the body is a self-protection mechanism, completely our own, but in combat sports, the body is selfless, a tool of yours.
Investors serve founders; there's no need to only share good news.
Cynthia: Dealing with investors is probably a required course for every founder. I'd like to hear your advice for our entrepreneurial friends.
Kai Liu: Many founders, when interacting with investors, easily only talk about the good and not the bad. I understand this psychology, but I think going forward, everyone can be more平常心 (level-headed), and discuss what you truly care about with us.
We're actually in a service role. The more you share, the more we can truly help you solve problems. Everyone can be more open and candid, saving lots of speculation, because speculation is often wrong.
Zheng Feng: I wouldn't dare call it advice. I think early-stage investing is a very subjective process; everyone has different styles. I sometimes joke that talking with investors is like dating — it's not that you're not good, just that we're not a match. So my specific suggestion is be real. Be yourself. By showing who you are, find the person most compatible with you.
One possibility is very regrettable: maybe 99 people say you shouldn't do this, and you really change because of those 99 people, but they won't necessarily be with you. Maybe your original approach was actually someone's favorite, but you haven't found them yet. When you truly become stronger and present yourself, the charm is different. That thing is what's most attractive.
Yipu Zhu: Everyone's similar on this: be candid and sincere. I think now is an era of abundant money and scarce good projects. Investors or investment capital serve your growth, not judge you, so don't cater to investors' thinking — stick to your own ideas. Founders invest far more time and energy than investors. You still need to think your own things through clearly and persist in your own path.
Bonus & Recommendations
Cynthia: Can everyone recommend a work that's been inspiring for your career, a book or film?
Kai Liu: There's a book called Endurance: Shackleton's Incredible Voyage, which can firm up some confidence. Also a spiritual massage-type film, The Secret Life of Walter Mitty — I've watched it several times, warm and empowering.
Zheng Feng: I often mention lately The Fifteen Years of Boiling — you can see many ups and downs in it. For film/TV, the series WeCrashed. There's a detail where the CEO pitches many stories to VCs, none successful. Anne Hathaway, playing his girlfriend, says you must have something you yourself like, you should do that thing. Finally he did WeWork.
Yipu Zhu: On a March business trip to Shanghai, I reread The Call of the Wild — about a dog going through hardships and returning to being a wolf. If you're going to start a company, you may need to go through much such returning.
Austin: Although Elon Musk himself is quite controversial, one thing he said makes sense. Someone once asked him to recommend one sentence to inspire entrepreneurs. He said if you need others' encouragement to start a company, then better not start one. Conversely, I'd more suggest looking at failure cases, like The Great Failure. Successful people's success is hard to replicate, but failed people's failure — well, you never know. Knowing how they died can help you avoid some problems and dangers.
Cynthia: I can recommend The Alchemist. Whether founding or investing, it's about exploring your own boundaries, gradually knowing what you want. This work is about that too.
Finally, after this COVID wave passes, is there anywhere you absolutely want to go?
Kai Liu: Planning to climb Haba Snow Mountain in Yunnan.
Zheng Feng: I got the itch last year — want to ride downhill mountain bikes in Zhangjiakou in summer, taking the ski resort lifts up, with beginner/intermediate/advanced runs, biking down.
Yipu Zhu: Hurry to catch a Premier League match.
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