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KEY STAT | Hillhouse Capital building one of Asia’s biggest PE pool with USD 13 billion raise

The VC/PE firm that backed Tencent and JD.com is reloading USD 13 billion for future investments.

Hillhouse Capital, one of the earliest gold diggers in China’s booming internet industry, is reportedly raising a new round of capital worth as much as USD 13 billion, as the firm prepares to seize new opportunities in a troubled economy.

Nearly USD 10 billion of the reload will go into buyouts, with the rest to be allocated to growth equity and venture capital investments, according to the original report by Bloomberg.

With the amount of injection, Hillhouse Capital is consolidating its position as one of Asia’s biggest investment institutions and one of the only evergreen funds in China who provides full-cycle investments from early-stage to the second market.

Under the double pressure of the COVID-19 epidemic and “capital winter”, most VC and PE institutions are at present in a semi-dormant state. China recorded the most inactive first quarter in almost a decade, but Hillhouse Capital has made 13 deals up to April, according to data service ITjuzi.

Besides popular bubble tea chain Heytea, SoftBank-backed online estate brokerage Beike, and edtech Yuanfudao, the firm has also continued to enrich its investment profile with medical and healthcare businesses this year, echoing the growing attention to that area during the global public health crisis.

Led by Yale graduate Zhang Lei, Hillhouse is a key backer of China’s internet boom in the 2000s.

Believing in the future growth of the internet community, Zhang made his first investment in Tencent (HKG: 0700) in 2005, at a time when only 8.5% of the Chinese population had access to the internet.

In 14 years, Tencent’s value increased 250 times from USD 2 billion to USD 500 billion.

Zhang was also one of the earliest investors of JD.com (NASDAQ: JD), now the second largest e-commerce site in China, ride-hailing giant Grab, and laundry detergent monopolist Blue Moon.

Earlier this year, Hillhouse set up a RMB 10 billion (USD 1.34 billion) fund for startups in China. According to the company, one third of the businesses they invested in has grown to unicorns.