Fortune Venture Capital (also known as Fortune Capital) () is a state-backed Chinese

venture capital Venture capital (VC) is a form of private equity financing provided by firms or funds to start-up company, startup, early-stage, and emerging companies, that have been deemed to have high growth potential or that have demonstrated high growth in ...

firm founded in 2000. The firm is owned by the Hunan TV & Broadcast Intermediary Co Ltd which in turn is owned by the

Hunan Broadcasting System Hunan Broadcasting System (HBS) () formerly known as Golden Eagle Broadcasting System (GBS), is China's second biggest State media, state-owned television network after China Central Television (CCTV). The television network is owned by the Huna ...

. It is considered one of the earliest state-backed venture capital firms in China.

Background

Fortune Venture Capital was founded in 2000 by Liu Zhou. Liu first saw the potential of venture capital when the company he worked for, Hunan TV & Broadcast held its

initial public offering An initial public offering (IPO) or stock launch is a public offering in which shares of a company are sold to institutional investors and usually also to retail (individual) investors. An IPO is typically underwritten by one or more investm ...

on the

Shenzhen Stock Exchange The Shenzhen Stock Exchange (SZSE; ) is a stock exchange based in the city of Shenzhen, in the People's Republic of China. It is one of three stock exchanges operating independently in Mainland China, the others being the Beijing Stock Excha ...

in 1999. In 2000, Long Qiuyun, the chairman Hunan TV & Broadcast gave Liu 100 million yuan to start a venture capital firm. At the time, Liu was unsure whether to open the firm in

Beijing Beijing, Chinese postal romanization, previously romanized as Peking, is the capital city of China. With more than 22 million residents, it is the world's List of national capitals by population, most populous national capital city as well as ...

Shenzhen Shenzhen is a prefecture-level city in the province of Guangdong, China. A Special economic zones of China, special economic zone, it is located on the east bank of the Pearl River (China), Pearl River estuary on the central coast of Guangdong ...

so he asked a

Feng shui Feng shui ( or ), sometimes called Chinese geomancy, is a traditional form of geomancy that originated in ancient China and claims to use energy forces to harmonize individuals with their surrounding environment. The term ''feng shui'' mean ...

master who told him to pick Shenzhen. However Liu has stated he already decided with Shenzhen from the beginning because it was the frontier of reform and opening up. In the first ten years, the firm struggled. From 2001 to 2005, the firm had been losing money. Of the 196 companies the firm invested in, only 10 were in operation by 2005. During this period, the firm tried to make investments outside venture capital including the disposal of

non-performing loan A non-performing loan (NPL) is a bank loan that is subject to late repayment or is unlikely to be repaid by the borrower in full. Non-performing loans represent a major challenge for the banking sector, as they reduce profitability. They are ofte ...

s and real estate development As a result, every time Liu returned to Hunan to attend meetings of Hunan TV & Broadcast, he was criticised for the poor performance of the firm. Some even suggested moving the headquarters back to

Changsha Changsha is the capital of Hunan, China. It is the 15th most populous city in China with a population of 10,513,100, the Central China#Cities with urban area over one million in population, third-most populous city in Central China, and the ...

to save cost or closing the firm down all together. The first real success of the firm came when it bought a 10% stake in Coship Electronics which went public on small and medium-sized enterprise board of the Shenzhen Stock Exchange in June 2006. In 2009, Hunan TV & Broadcast revised its articles of association making Fortune Venture Capital the main business of the company. Fortune Venture Capital was the largest source of profit for the company. In January 2017, Hunan TV & Broadcast approved a deal to allow the management team at Fortune Venture Capital to acquire a 20% stake in the firm. This was done retain talent as the firm's employee compensation was less than that of other private venture capital firms. The deal raised questions on whether the firm was valued properly. The firm has a strict investment model. Before giving any money to companies, Liu insists on meeting more than 90 percent of a company's shareholders and management, and examine at least seven of its departments. In addition he would meet four or more of a company's clients, and look into at least three of its direct competitors. Fortune Venture Capital has enjoyed numerous benefits because of its government affiliation. The Shenzhen Guidance Fund has invested into the firm's funds. Notable investments of the firm include BlueFocus Communication Group, Wangsu Science & Technology and

Redcore Redcore ( zh, s=红芯浏览器, l=red core browser)Official website: , where it shows that the browser is named "Redcore Browser" ( zh, 红芯浏览器), and the browser engine is "Redcore" ( zh, 红芯内核) is a web browser developed by Chin ...

References

External links

* {{authority control Chinese companies established in 2000 Companies based in Shenzhen Financial services companies established in 2000 Government-owned companies of China Investment management companies of China Venture capital firms of China