China-based local services platform Meituan-Dianping has formed a RMB3bn ($435m) venture capital fund that will invest in the consumer internet sector, according to China Money Network, which cited local media reports.
The firm was formed in late 2015 by the merger of group buying specialist Meituan and local listings and reviews platform Dianping in a deal worth $15bn. The merged business raised another $3.3bn in a January 2016 round featuring internet group Tencent.
Meituan-Dianping intends to initially raise RMB1.5bn for the fund, and in addition to providing capital itself, is set to secure finance from Tencent and agribusiness New Hope Group. The firm also plans to get commitments from other external investors.
The fund will invest in companies operating in the retail, entertainment, food and beverage, hotel and tourism sectors in a bid to build out an ecosystem around Meituan-Dianping’s offering.
More specifically, the unit intends to invest in companies at pre-series C stage, in rounds sized roughly between $4m and $15m.
Chen Shaohui, Meituan-Dianping’s senior vice-president of corporate development, will oversee the fund as chief executive, while Zhu Yonghua, a former executive director of conglomerate Legend Holdings, is a founding partner.