BlueRun Ventures: The Golden Age of Tech Investment Is Here — Being a Calm First Mover in an Era of Transformation and Industrial Innovation

蓝驰创投·September 2, 2022·0·0

Only those who dare to lead can embrace an undefined future.

As the golden age of tech investing arrives, firms that positioned themselves early are now seizing the perfect moment to swing — "It's My Turn." Recently, ChinaVenture reported on BlueRun Ventures' observations of underlying trends and its strategic approach to selecting sectors. Here's what they shared:

This year, economic turbulence has slowed both domestic and international growth, market sentiment has fluctuated, and expectations for what's ahead are clouded with uncertainty and confusion. But investing is precisely about managing future risk. Every choice made today shapes the trajectory, and there's no stopping.

Looking across the capital markets, TMT and new consumer sectors have suddenly gone cold, while energy transition, smart manufacturing, and enterprise services are heating up. As change sweeps through, the old growth logic is losing its grip, and we urgently need a technological transformation to enter a new development cycle.

Unlike the internet investment paradigm, tech investing demands more forward-looking vision, deeper industry understanding, and more patient companionship. Blindly pivoting risks landing in a "more will than way" predicament.

The feedback cycle for early-stage tech investing is long — so long that without a decade of accumulation, it's difficult to produce true industry leaders; so long that many funds, constrained by their lifespan, shy away.

Yet for some firms that laid groundwork early, the arrival of tech investing's golden age is precisely that "It's My Turn" moment. BlueRun Ventures is one of them.

As sectors rotate between hot and cold, BlueRun — having built a ten-year head start — moves more like a composed trailblazer, maintaining calm judgment and distinctive investment strategy, grasping innovation and transformation trends, and acting decisively at the right moment, making every thought and action an influential force that contributes to the future.

Crossing Cycles

Being an Early Pioneer in Tech Investing

Perhaps influenced by its Silicon Valley DNA, BlueRun believes "undefined" is the true nature of entrepreneurship and innovation, and that early-stage investing must continuously push boundaries and dare to be first. For over two decades, BlueRun has focused solely on tech investing. Through multiple global economic and innovation cycles, it has never wavered from technology as its constant north star.

Building such a lead means enduring long stretches on the sidelines. BlueRun's commitment to "investing early and investing in tech" brought it through several dark periods, but time ultimately rewards those who stay true to their original vision. Before new energy vehicles became consensus, BlueRun was an early investor in Li Auto, backing it through five consecutive rounds before its value exploded, accompanying it to dual listings on Nasdaq and the Hong Kong Stock Exchange — a richly rewarding outcome.

Similar cases abound. BlueRun has consistently demonstrated its commitment to tech investing through action, accompanying founders from zero to one. The sense of accomplishment and motivation through this process ultimately comes from solving problems at the intersection of technology and life, using commercial means to find solutions for societal challenges.

Facing market volatility, BlueRun has always maintained a steady rhythm. In the first half of this year, hit by both COVID and a capital winter, market sentiment was low and "fundraising difficulty" was on everyone's lips. In May, BlueRun announced the closing of a new dual-currency fund, with total scale equivalent to roughly RMB 5.5 billion. This was the first institution to announce a major fundraising in the first half, significantly boosting industry morale.

Tech investing cannot succeed without accurately identifying cycles. For firms that have crossed multiple cycles, looking forward from any given node, the path seems fraught with danger; looking back, it appears calm. What matters is always keeping ample ammunition in hand, and having the courage to bet decisively when market conditions are depressed.

Sensing Underlying Trend Shifts

Actively Participating in a New Round of Economic Growth

In the view of Jui Chan, Managing Partner of BlueRun Ventures, the driving force of social development is shifting. Continuing to invest in technology in the current environment is essentially experiencing a redistribution of GDP, and actively participating in a new round of economic growth. Only by sensing and grasping underlying trend changes can one better identify opportunities.

This round of change can be summarized through several key characteristics:

From a demographic perspective, China's population aging will accelerate over the next 3-4 years. The population over 60 already exceeds 20% of the total, and is projected to reach roughly 35% by 2035. Changes in labor force characteristics will gradually guide industrial structure away from labor and resource intensity toward capital, technology, and knowledge intensity.

From an international situation perspective, China and the United States will have a long-term competitive relationship. Some developed countries are attempting to monopolize certain production tools to gain dominant positions. Persisting in independent technological innovation, developing strategic scientific and technological capabilities, and accelerating "domestic substitution" are imperative.

From a development history perspective, all three modern technological revolutions began with technological innovation, found fertile soil across industries, brought massive efficiency gains, and ultimately propelled human civilization forward. Therefore, to break through development bottlenecks, a new round of technological and industrial revolution is urgently needed. Amid all the changes, new technologies and new industries represent relatively certain opportunities.

Based on its macro judgment about population aging, BlueRun identified the application of low-speed autonomous driving in cleaning scenarios, and led the Series A of Gaussian Robotics, which has since become the absolute leader in cleaning robots, with products sold in over 30 countries and regions, and post-investment valuation growth of roughly several tens of times. Based on its accurate assessment of the relationship between cloud computing, big data, and artificial intelligence, BlueRun became the first institutional investor in QingCloud Technology, continuously supporting it to become the first hybrid cloud company listed on the STAR Market in 2021.

Forward-thinking and accurate positioning have enabled this firm to capture investment opportunities ahead of others. BlueRun was not only the first institutional investor for companies including Anxin Shield and YunTu Semiconductor, but also the Series A lead investor for Raymo Tech, Bornrecycle, CloudSaints Intelligence, Penglai Data, and Jishi Design, fully leveraging the value discovery function of early-stage investing to help these startups secure follow-on investment from top-tier institutions and accelerate onto the fast track of development.

Breaking the Unseen with Foresight

Exploring Undefined Battlefields

Unlike some spray-and-pray approaches, BlueRun — an institution with something of a "sweeping monk" temperament — chooses to build a vast matrix of quality innovative projects through deep cultivation of niche sectors, then continuously follow on with the best among them, seizing the certainty of scarce assets.

Driven by long-term domestic and international factors, numerous sub-sectors hold systematic development opportunities in the future. BlueRun also maintains long-term focus on advantaged domains where technological innovation grows into future industries, breaking the unseen with foresight, and exploring undefined battlefields.

01 Niche Blue Ocean Opportunities in New Energy

After decades of development, benefiting from technological advancement and engineer dividends, China has accumulated corresponding industrial foundations in electrification, photovoltaics, hydrogen energy, nuclear energy, and energy storage. Moreover, to counter the influence of the petrodollar and dollar hegemony, continuing to vigorously develop new energy is an inevitable choice. BlueRun has made advanced project reserves around upper-layer applications, energy-related domains, and underlying technologies.

For example, BlueRun observed that with the rapid普及 of new energy vehicles, retired power batteries will see explosive growth in the future, while China's extractable lithium, cobalt, and other battery material metal resources are scarce, with low supply chain security redundancy. The low-carbon recycling and reuse of power batteries holds enormous market potential. Therefore, BlueRun exclusively invested at the Pre-A round in the leading power battery recycling solution provider Bornrecycle.

Bornrecycle takes efficient extraction technology as its core advantage, able to regenerate over 90% of metals from waste batteries into battery-grade products, achieving over 20% of total vehicle value recovery. It has already partnered with nearly ten Fortune 500 companies in the energy sector and leading domestic battery and energy enterprises, with performance growing rapidly year after year.

Energy storage is another sector BlueRun favors. Market size is projected to reach RMB 250 billion by 2025 and over RMB 800 billion by 2030, representing massive incremental space. Based on the challenges energy storage faces in safety and economics, BlueRun invested in digital energy storage solution provider CloudEnergy New Energy.

CloudEnergy New Energy has built a full battery lifecycle management system based on digital energy storage. CloudEnergy has disrupted the fixed series-parallel battery application paradigm that has persisted for over two centuries, transforming traditional hard connections between batteries into program-controlled flexible connections, constructing an innovative "energy storage as a service" business model. It has established deep cooperation with multiple leading enterprises including State Grid Corporation of China, Huadian, and China Three Gorges Corporation, with current order volume growing rapidly.

02 Underlying Technology Driving Robots into the Fast Lane

Technological progress, population aging, and industrial structure changes are continuously driving rapid development in the robotics sector. The market space for jobs that can be replaced by robots is vast. As robot types multiply and performance improves, their application scenarios and scope are further expanding. Combined with domestic supply chain and manufacturing advantages, the economies of scale in robot production are becoming increasingly evident, and many robotics companies' products are also selling well overseas. On this foundation, BlueRun favors robotics investment opportunities that possess relevant industry scenario cognition, underlying technology accumulation, and effective efficiency improvement realization.

For example, BlueRun identified that in industries with large customer scale and significant safety concerns — such as power, security, energy, mining, and smart cities — the problems of rising human inspection costs and shrinking labor supply are most pronounced. It favors the massive application market for industrial unmanned robots, and has supported fully autonomous drone and system R&D service provider CloudSaints Intelligence from its Series A onward.

CloudSaints Intelligence provides more advanced, safer, and more efficient services for the power industry, industrial sector, and smart cities through fully autonomous inspection using "industrial drones + fully automatic airports + ground robots." It is also currently the only company in the Chinese market supporting automatic battery replacement for industrial drones, enabling 7×24 uninterrupted unmanned operations. It has established deep cooperation with State Grid Corporation of China and world-renowned oil and gas pipeline companies, and served as a power security unit for the Beijing Winter Olympics. Its Tiger Whale & Tiger Den fully autonomous drone inspection system, with its innovative design concept and superior product performance, won the German Red Dot Award — one of the world's three major design awards. The company's performance continues to grow; despite COVID impacts in the first half of this year, contract value increased significantly year-over-year.

Based on the current market reality that traditional logistics robots generally lack visual perception capabilities and have room for performance improvement, BlueRun also identified deep vision system-based robotics company Bluecore Technology in the flexible manufacturing domain.

Bluecore Technology is China's first and currently only robotics company to independently develop a mobile robot deep vision system (MRDVS) and deploy markerless visual navigation, gradually replacing traditional lidar-based positioning, navigation, and obstacle avoidance solutions. This enables mobile robots to achieve optimization in stability, safety, and intelligence, adapting to broader and more complex industrial application scenarios, providing complete visual perception solutions for mobile robots and smart logistics solutions for manufacturing. Bluecore Technology's complete machine products have been batch-deployed in 3C electronics, new energy, packaging, railway chemicals, and other industries. Representative clients include well-known brands such as Huawei, ZTE, Midea Group, Toshiba, Foxconn, and Hynix, as well as leading enterprises in photovoltaics and lithium batteries. In 2021, Bluecore Technology's sales orders grew 600%, with further rapid growth in 2022.

03 Digital Intelligence Bringing New Potential to Manufacturing

Against the backdrop of domestic substitution and supply chain security, smart manufacturing is the inevitable path for China's manufacturing industry to upgrade, transform, and improve quality and efficiency.

On one hand, BlueRun focuses on the theme of industrial digitalization, favoring opportunities that can bring innovative solutions to industry scenarios with core element innovation. It conducts systematic, systematic investment from upstream and downstream industry chain perspectives, building industrial collaborative ecosystems, and paying attention to new manufacturing, new processes, and new software investment opportunities.

For example, BlueRun identified that China's mold market exceeding RMB 100 billion has strong upgrade needs, while mold 3D printing technology can significantly shorten process steps and production cycles, while maximizing reduction of manufacturing costs and processing risks, improving product precision and digitalization levels, solving pain points around efficiency, quality, cost, and homogenization for traditional mold enterprises, and reconstructing the mold industry landscape. It led the Series A of mold industry 3D metal printing solution provider Raymo Tech.

Through continuous systematic technology R&D innovation, Raymo Tech has taken the lead in completing the 0-to-1 technology and market development phase for mold 3D printing applications. In the mold 3D printing domain, it has formed a high systemic core technology barrier and closed-loop value of "innovative materials + process + equipment + service," truly being the first in the industry to "cross the chasm" and demonstrating strong growth potential, with continuously improving performance. Its products have been widely applied in well-known enterprises across multiple industries: in 3C, it has entered the mold and molding supply chains of Apple, Huawei, Xiaomi, and OPPO/vivo; in personal care, it has entered the packaging mold and molding supply chains of L'Oréal, Lancôme, Estée Lauder, and Procter & Gamble; in medical, it has entered the medical consumables mold and molding supply chains of Philips and Mindray; in automotive and home appliances, it has also provided 3D printed injection mold applications for BMW and Aux.

On the other hand, BlueRun focuses on the chip and semiconductor domain, paying attention to investment opportunities with high barriers, strong demand, and sustainability characteristics, having invested in companies including Shanhai Semiconductor and Xinlai Technology. BlueRun identifies promising projects from the startup phase, favoring the rigid demand for domestic substitution in automotive electronics and automotive chips, and became the first institutional investor in automotive-grade chip R&D manufacturer YunTu Semiconductor.

YunTu Semiconductor, with its professional background and deep technical foundation, completed mass production of two high-quality automotive-grade MCUs in less than two years since establishment, including currently the only domestically mass-produced high-end 32-bit automotive-grade MCU based on Arm Cortex-M33 in China, filling a domestic gap. Currently, YunTu Semiconductor's two automotive-grade MCUs have passed relevant testing by over 50 Tier 1 suppliers and OEMs, and it has become the domestic semiconductor company with the most comprehensive product portfolio of automotive-grade chips.

04 New Opportunities in Enterprise Digitalization

BlueRun believes that as digitalization brings new growth potential, the enterprise services track is in an accelerated development phase. With catalysis from rising demand and technological progress, many sub-sectors contain new opportunities.

For example, as aging increases societal healthcare burdens, and as healthcare reform policies such as centralized procurement of drugs and medical devices and DRGs/DIP deepen, hospitals' past extensive management models are unsustainable. There is urgent need to improve operational management efficiency, and operational management informatization construction will become a rigid demand. BlueRun favors the application space of data in healthcare management, and led the Series A of hospital lean management and resource allocation full-stack solution provider Penglai Data.

Penglai Data, as a leader in the new generation of hospital intelligent operation management platforms, has its performance evaluation system, DRG evaluation and operation analysis system, dynamic cost analysis and control system, and other products already deployed in nearly 400 hospitals, over 80% of which are Class III Grade A hospitals, with a customer retention rate as high as 97%, achieving top position in its niche market. As a Shanghai-based company, its business further accelerated in the first half of this year, with full-year performance expected to achieve significant breakthroughs.

In the cybersecurity domain, over the past 20 years, cybersecurity development has lagged far behind informatization development. The industry is in a wave of transformation, and memory protection is the new technology in this wave that solves new problems. Microsoft has also revealed that approximately 70% of all vulnerabilities its products address annually through security updates are memory safety issues. BlueRun Ventures has consistently paid attention to innovation in this niche, investing from the angel round in information security solution provider Anxin Shield.

Anxin Shield is the only company in China and one of only two globally to master memory protection technology and achieve product deployment. Anxin pioneered a memory intelligent protection system based on virtualization and other advanced technologies, and is the first security solution provider capable of organic integration at the application layer, system layer, and hardware layer to provide comprehensive three-dimensional protection. It has begun continuously serving benchmark clients including Huawei, Baidu, Kingsoft, China Customs, Bank of Beijing, Google, and G42, with continuously improving performance and broad market expansion space ahead.

The ability to quickly target these reserve projects is inseparable from BlueRun's high team execution capability. Through years of practice, BlueRun has established a professional team with compound backgrounds and stable collaboration. When building its investment frontline, BlueRun deliberately seeks "T-shaped talent" — both deep vertical industry knowledge and attention to horizontal cross-industry application of technological innovation, combining vertical and horizontal strengths into combat effectiveness. At the same time, BlueRun has also built an institutionalized, systematic middle and back office system, serving and supporting portfolio companies in strategy, finance, legal, HR, and branding.

Having entered China for nearly 20 years, BlueRun has experienced multiple technological innovation cycles. Each time before transformation, BlueRun has been able to position early — from internet, mobile internet, to electrification, electric vehicles, AI, robotics, smart manufacturing, and more — always finding opportunities in underlying trend changes and deep sector accumulation. Tech investing is an eternal proposition; only by daring to be first can one embrace an undefined future.

BlueRun Ventures, this veteran VC focused on early-stage technology investing, is maintaining its composed rhythm and advancing toward the next high-potential sector.