Top 5/15/50/100, Going Global to India, Teaming Up with Tencent on IVI... 13 Takeaways and 8 Insights | FreeS Chalkboard · August
"Choose the more long-term path, even if it's the harder one."
FreeS Fund's August newsletter — sharing the latest updates with our long-standing friends and partners:
- FreeS Fund invested in the A+ round of iBackCheck, an online pre-employment background screening platform;
- FreeS Fund hosted "FreeS Talks," an offline sharing session for portfolio CEOs, with deep dives into how CEOs find and deploy top talent;
- FreeS Fund ranked in the Top 15 on Yicai's "China Venture Capital Institutions Ranking," with FreeS Fund VP Huang Hai named among the Top 5 "Best Young Investors of 2017–2018";
- FreeS Fund named to the Top 100 of the "Golden Bridge Award 2018 China-US Influential Investment Institutions" list for China-US influential funds.
We're also sharing good news from the FreeS family:
- Deep Tech: Feixin Electronics, which provides chip-level solutions for LiDAR, raised tens of millions of RMB in a pre-A round; NextVPU released the world-leading AI vision processing chip N171; SoundAI Technology partnered with Tencent to bring voice interaction into vehicles.
- Consumer: Guancha raised tens of millions of RMB in an A round; Shima Chuxing completed a pre-A round of over $10 million.
- Awards: On the Ministry of Industry and Information Technology's China Industrial Innovation list — Onion Math, IceKredit, and XtalPi were named among the "Top 50 Most Investment-Worthy Companies," while Eflytek and SoundAI Technology made the "Top 50 Most Development Potential" list; four FreeS family founders were selected for Fast Company's "China's 100 Most Creative People in Business"; IceKredit was shortlisted as an "Outstanding Enterprise" case at the 2018 National Fintech Summit; VPhoto won the "Global Best Innovative Media Agency Award" at the Busan International Advertising Festival.
As a young fund, FreeS Fund will continue to stay grounded and push forward, looking forward to meeting innovation and the extraordinary.
FreeS Fund News
1
FreeS Fund Invests in iBackCheck's A+ Round
Recently, online pre-employment background screening platform iBackCheck announced it had completed a tens-of-millions RMB A+ round, led by Eastern Capital, with FreeS Fund — an angel-round investor — continuing to follow on.
iBackCheck has standardized and optimized the heavily manual investigation process, replacing many time-consuming steps with online technology. For example, it introduced e-signatures and facial recognition into the authorization process, replacing inefficient physical authorization forms; it uses deep learning and AI to parse interview content, reducing the mechanical, repetitive workload on investigators. (See coverage: [36Kr] Using AI to Improve Background Check Efficiency, "iBackCheck" Raises Tens of Millions in A+ Round)
2
FreeS Fund Hosts "FreeS Talks," an Offline Sharing Session for Portfolio CEOs
"FreeS Talks" is a small-scale offline gathering for CEOs in the FreeS family. We invite experts who understand the topics our CEOs care about, and FreeS family CEOs with real battle experience, to share their knowledge and lessons.
On the afternoon of August 10, we invited two guests and about 30 founders and their HR heads for an in-depth discussion on "Team Cohesion Is the Fundamental Productivity." Du Hong, HR Director at ByteDance, broke down what a capable HR can actually do for a CEO; Ning Rui, CEO of Shima Finance, shared how his company approached hiring and people management across three stages: when there was no one, when there were people, and when reform was needed.
3
FreeS Fund Ranks in Top 15 on "China Venture Capital Institutions Ranking"
On August 9, Yicai released its "2017–2018 China Venture Capital Institutions Ranking," scoring across five dimensions: fundraising, team, deal flow, investment, and exits. FreeS Fund was ranked in the Top 15, and FreeS Fund VP Huang Hai was named among the Top 5 "Best Young Investors of 2017–2018." (See coverage: [Yicai] The Most Important Release of 2018 | Yicai "China Venture Capital Institutions Ranking" Revealed!)
4
FreeS Fund Named to China-US Influential Funds Top 100
On August 17, 2018, Eastern Time, the "China-US FOF Summit" co-hosted by China FOF Research Center and Zhitouhui released the Golden Bridge Award 2018 China-US Investment Institutions Influence list. The list was divided into China-US Equity FOF Influence Top 100 and China-US Equity Fund Influence Top 100, scored and selected by 100 leading industry FOFs from both countries. FreeS Fund made the China-US Equity Fund Influence Top 100. (See coverage: [Daily Decode] Second China-US FOF Summit Held, Golden Bridge Award 2018 China-US Investment Institutions Influence List Released)
FreeS Perspectives
▍FreeS Fund's Li Feng: Choose the Longer-Term, Harder Path
By rights, the right things are never easy. From a results-oriented perspective, so-called correct things are basically relatively independent — they avoid the directions most people prefer. Otherwise, they'd quickly be distorted by crowds of people, money, resources, and expectations. So if you want to choose something more long-term, you can only choose what looks a bit harder. That means being able to stay calm, and endure for a long time something that seems to be heading in a direction fewer people choose. (See coverage: [NetEase Finance] FreeS Fund's Li Feng on Investing: Choose the Longer-Term, Harder Path)
▍FreeS Fund's Huang Hai: Home Goods Will Spark a New Wave of Consumer Spending
Shopping mall tenant mixes don't differ much worldwide. The biggest difference between Chinese malls and those in developed countries is home goods stores. For example, the US and Japan have more home goods brands than China, with stores on every street corner. Previously, Chinese department stores and malls were packed with apparel brands, but apparel has passed its dividend period. In the future, home goods will spark a new wave of consumer spending, just as apparel brands once did.
China's current consumption resembles Japan's in the 1970s–1980s — MUJI was founded in Japan in the 1980s. Today's post-85s and post-90s generations are already entering or about to enter parenthood, facing marriage and child-rearing, so home goods and母婴 are directions with strong consumption potential. The next 5–10 years will be a golden period for home goods category development. (See coverage: [Winshang] These Are the Business Formats Malls Should Focus on in the Future!)
▍FreeS Fund's Li Feng: Looking Back Three Years Later, Many Systems Have Worked
When FreeS Fund was founded, we proposed a series of institutional innovations — external referrers who recommended deals that ultimately got done could share in the deal's carry; young investors, like partners, participated in project voting; deep industry research was fully shared internally and regularly output externally...
Looking back now, many of these systems have worked. For example, after announcing that external referrers could share carry, we received many business plans, and we already have cases where referrers have actually received carry for introducing deals to us. Sharing industry research externally is also a process of building networks, making it a bit easier for investment colleagues to invest in their respective directions. (See coverage: [Yicai] The Most Important Release of 2018 | Yicai "China Venture Capital Institutions Ranking" Revealed!)
FreeS Family Updates
1
Deep Tech | Feixin Electronics Raises Tens of Millions in Pre-A Round
Recently, Feixin Electronics Technology, a provider of chip-level LiDAR solutions, raised tens of millions of RMB in a pre-A round co-led by Bosch Group and Orbbec, with proceeds going to technology R&D and market expansion.
Founded in 2016, Feixin Electronics develops low-cost, compact, highly reliable LiDAR products with strong anti-interference and eye safety protection, through proprietary core technologies in chip design, circuit design, signal processing, and system integration. (See coverage: [Cyzone] Exclusive | Providing Chip-Level Solutions for LiDAR, Feixin Electronics Raises Tens of Millions in Pre-A Round)
2
Deep Tech | NextVPU Releases World-Leading AI Vision Processing Chip N171
On August 30, NextVPU, which focuses on AI and computer vision technology, released the world-leading AI vision processing chip N171. As the flagship chip in NextVPU's N1 series, N171 set new world records on multiple parameters, elevating chip vision processing capability to new heights. N171 features an advanced compute engine with powerful geometric solving and deep neural network processing capabilities, applicable to security monitoring, robotics, drones, AGVs, smart homes, automotive, and many other fields. (See coverage: [NextVPU WeChat Official Account] NextVPU Releases World-Leading AI Vision Processing Chip N171)
3
Deep Tech | SoundAI Technology Partners with Tencent to Bring Voice Interaction to Vehicles
At the end of 2017, SoundAI Technology reached a cooperation agreement with Tencent to jointly develop an in-vehicle system with voice interaction capabilities, with SoundAI providing the audio pickup and speech recognition modules. The system has now completed development, and Tencent is working with a domestic brand to push for mass production installation, with three production models featuring the system expected to hit the market by year-end. (See coverage: [Che Dongxi] After Landing BAT and Huawei, This Company Is Making In-Vehicle Systems with Tencent)
4
Consumer | Guancha Raises Tens of Millions in A Round
Recently, Guancha, a health food brand built around matcha as its IP, announced it had completed a tens-of-millions RMB A round, led by Shunwei Capital, with Meridian Capital and multiple strategic investors following on. Founder Xiao Guan said proceeds would mainly go to building hit products, team upgrades, and store expansion.
On the brand's long-term development, Xiao Guan stressed that Guancha shouldn't become merely a traffic brand or channel brand. "We live in the best of times, but these times are a bit浮躁, a bit impatient — in chasing traffic, people always forget the product. I want to settle down and make a truly valuable good product and good brand. I've prepared enough patience for Guancha, and I'm young enough." (See coverage: [iYiou] Exclusive | Guancha Raises Tens of Millions in A Round, Shunwei Capital Leads)
5
Consumer | Shima Chuxing Completes Pre-A Round of Over $10 Million
Recently, Shima Chuxing, a new S2B2C new retail transaction service platform under Shima Group focused on new energy vehicles, raised over $10 million in a pre-A round, led by domestic A-share listed company Tongcheng New Materials Group, with Dezhou Fulu Investment following on. Proceeds will mainly go to building Shima Chuxing's new retail transaction system, selecting hit models, channel construction in the new energy mobility market, and team building. (See coverage: [Shima Chuxing Merchant Account] Shima Chuxing Raises Over $10 Million in Pre-A Round 66 Days After Launch, New Retail for Rural Mobility Sees Industry Dark Horse)
6
FreeS Family Award News
▍5 Portfolio Companies Make MIIT China Industrial Innovation List
On August 19, the MIIT Information Center and iYiou Think Tank jointly released the "Future · Influence" China Industrial Innovation list. The list was divided into "Potential List" and "Investment List": the Potential List measured enterprise development potential and growth through indicators including innovation capability, growth potential, team capability, and capital strength to identify high-potential enterprises; the Investment List measured investment value of high-growth enterprises through indicators including capital strength, commercial capability, team capability, and brand reputation to identify the most investment-worthy enterprises.
FreeS family portfolio companies Onion Math, IceKredit, and XtalPi were named to the "Top 50 Most Investment-Worthy," while Eflytek and SoundAI Technology made the "Top 50 Most Development Potential." (See coverage: [iYiou] Major Release! "Future · Influence" China Industrial Innovation List)
▍4 FreeS Family Founders Selected for Fast Company "China's 100 Most Creative People in Business"
For five consecutive years, Fast Company has released its "China's 100 Most Creative People in Business" list each summer. Fast Company evaluates people through the lens of creativity. Among this year's 100 business figures, four are FreeS family founders: Liu Qi, CEO of PingCAP; Wen Shubao, founder of XtalPi; Li Teng, founder and CEO of Bluepha; and Shen Yichen, founder and CEO of Lightelligence. (See coverage: [Fast Company] Releasing "China's 100 Most Creative People in Business" for 5 Consecutive Years, What Has Fast Company Created?)
▍IceKredit Shortlisted as "Outstanding Enterprise" Case at 2018 National Fintech Summit
On August 27, the "2018 National Fintech Summit" hosted by Xinhua News Agency Beijing Branch was held in Beijing, inviting multiple experts and scholars to discuss global fintech trends and development. Shanghai IceKredit Information Technology was shortlisted as an "Outstanding Enterprise" case. (See coverage: [Xinhua] IceKredit Shortlisted as "Outstanding Enterprise" Case at 2018 National Fintech Summit)
▍VPhoto Wins "Global Best Innovative Media Agency Award" at Busan International Advertising Festival
On August 23, VPhoto was awarded the "Global Best Innovative Media Agency Award" at the 2018 Busan International Advertising Festival. This was the only media category award. Additionally, VPhoto provided the official designated photo livestream service for this year's Busan International Advertising Festival. (See coverage: [China News Service Shanghai] VPhoto Wins "Global Best Innovative Media Agency Award" at Busan International Advertising Festival)
FreeS Family Perspectives
▍Onion Math CEO Yang Linfeng: How Human-Computer Interaction Product Forms Are Upgrading Education
Online math through human-computer interaction product forms is driving upgrades across education. First, shifting children from passive to active learning — this is a learning experience upgrade. Compressing teachers' long-winded lectures into 5–6 minute precision human-computer interaction courses — this is an efficiency upgrade. Being able to simultaneously serve children across all regions nationwide, tutoring them without differentiation — this is a scale upgrade. Driving costs down from over 10,000 yuan to one-twentieth the price — this is a price upgrade. Finally, applying AI throughout the complete learning loop to help children efficiently master knowledge — this is a technology upgrade. (See coverage: [36Kr] Onion Math CEO Yang Linfeng: Under the Online Math Boom, Human-Computer Interaction Drives Education Upgrade)
▍Tingjiandan CEO Liu Wenchao: Unmanned Parking Will Land in Scenarios Before Autonomous Driving
Unmanned parking is relatively simpler to implement because parking lots are relatively enclosed environments — we can eliminate interfering factors, leaving only vehicle-to-vehicle business connections. Based on this logic, unmanned parking will definitely land in scenarios before autonomous driving. (See coverage: [36Kr] Tingjiandan Chairman Liu Wenchao: Unmanned Parking Will Land Before Autonomous Driving | 2018 New Trends Summit)
▍2:10 Animation CEO Wang Shiyong: In Animation Production, What Can Be Solved by Computer Shouldn't Use People
Some projects on the market only use 3D-rendered-2D technology for backgrounds, but for 2:10 Animation, character performances, lighting changes when objects rotate, explosion effects, and a series of other shots can all be handled with三渲二 technology. What can be solved by computer shouldn't use people — people should do the most critical, most creative things. (See coverage: [Sansheng] Kingdom 2:10)
▍Club Factory Regional Manager Ashwin Rastogi: Become a "Horizontal Player," Not a Vertical Specialist
India has become Club Factory's highest-revenue market, and the company is clear that it will become a "horizontal player," not a vertical specialist. While apparel remains the best-selling category in India, other product categories on the platform — accessories, home goods, kitchenware, and electronics — are also selling well. The company plans to build Club Factory into a mass-market brand. Next, the goal is to cover tier-2 and tier-3 cities, competing with Indian e-commerce for 100 million new internet users in these smaller towns. (See coverage: [Factory Daily] How Club Factory Made a Success of Connecting Chinese Suppliers to Indian Consumers?)
▍Three Squirrels' Zhang Liaoyuan: Build Comprehensive Supply Chain Efficiency, Create Products and Experiences Users Can Perceive
When thinking today about how to go offline, we see an opportunity for comprehensive efficiency. The approach is just eight characters: "Innovation-driven, build brand through product."
"Comprehensive efficiency" isn't just same style, same quality, same price — it's comprehensive improvement across the entire enterprise and supply chain efficiency. For the next five years, "innovation" will be the core principle for Three Squirrels' development, while "build brand through product" means embedding products into user experience to build a stronger mindshare brand. Build comprehensive supply chain efficiency, create products and experiences users can perceive. (See coverage: [Three Squirrels Official Account] Squirrel Dad: How Internet Brands Go Offline)
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