The firm’s listing on the Shanghai Stock Exchange (SSE) raised $138m and delivered a successful exit to a number of the firm’s backers. These included IDG Capital Partners, Fortune Capital and Ping An Ventures, the corporate venturing arm of Ping An Insurance.
G-bits, which is based in Xiamen in southeast China, was set up in 2004 and is best known for massively multiplayer online (MMO) games, such as Underground Castle, Unbelievable Maze, Immortal War and Carefree Online. The company’s most significant breakthrough came in 2006 when China’s Ministry of Culture endorsed AskTao, an MMO role-playing game based on the ancient religion of Taoism, as the country’s “green online game for teenagers” – thereby providing a huge publicity boost.
The January flotation valued G-bits at just under $800m, with shares initially priced on the SSE at the equivalent of $8. In the months that followed, the share price rose dramatically on the back of improved profitability figures, reaching a high of $56 in March before stabilising between $30 and $40 over the course of the summer. Nevertheless, the firm is still valued at around $5bn and G-bits’ founder and chairman Lu Hongyan, who owns almost a third of his company’s stock, has become China’s latest technology billionaire.
Reports indicate that the Chinese online gaming market, which is evenly split between mobile and desktop or console play, is now worth well over $20bn. G-bits’ initial funding round was led by IDG Capital Partners – set up as a subsidiary of research company International Data Group (IDG) before buying its parent and renaming itself IDG Capital – and took place in 2007.
Ping An Ventures took its initial stake in the firm in 2011 in the course of a $23m funding round in which Fortune Capital also participated. Ping An’s corporate venturing business was set up in 2012 to make startup and early–stage investments in innovative companies in or related to China. Its main focus is on businesses in sectors such as science, technology, internet and mobility, consumption, finance and healthcare.
Meanwhile, in May this year, Ping An launched a parallel $1bn fund called Global Voyager, concentrating on financial and healthcare technology investments at an international level. The fund is run by Jonathan Larsen, former global head of retail banking at US-based Citigroup. As Global Voyager was unveiled, Larsen said: “Ping An is the most innovative financial group in China, and a leader in China’s fintech and healthtech sectors. I look forward to helping Ping An access global innovations in finance and technology and build a global presence in fintech and healthtech.”