“Beyond Fund 1” IRR Soared to 58% after the Buyback
HONG KONG, July 27, 2021 /PRNewswire/ — Beyond Ventures, a Hong Kong based venture capital firm and a co-investment partner with the Innovation and Technology Venture Fund (ITVF), had a 58% internal rate of return (IRR) on its Fund I from September 2017 through June 2021, thanks to the strategic buyback coupled with subsequent funding rounds of our portfolio companies.
Since its inception in 2017, Beyond Ventures has committed itself to the local ecosystem of budding startups across Hong Kong, facilitating the growth of home-grown unicorns through impactful venture funding. Beyond Venture’s GPs and serial entrepreneurs were all born or raised in Hong Kong, and have a deep personal interest in the success of the local startups.
The ITVF is a HK$2 billion fund established in 2017 by the HKSAR Government to co-invest in local start-ups with selected venture capital funds at a matching investment ratio of approximately 1 to 2, with the goal of creating a more vibrant innovation and technology ecosystem in Hong Kong.
Beyond Ventures is the most active and prolific co-investment partner of the ITVF, both in terms of investment amount and number of joint investment projects. Together, they have invested in ten of Hong Kong’s dynamic startups, including YOHO and enabot. The ITVF invested US$7.9 million in these companies, representing 52% of the ITVF total invested amount of US$15.29 million as of today on co-investment projects.
Lap Man, Co-Founder and Managing Partner of Beyond Ventures, commented on the venture fund’s recent success: “The ITVF is one of the most successful startup programs initiated by the HKSAR government to support the innovation and technology ecosystem in Hong Kong. The program can encourage VCs like Beyond Ventures to take additional risk in investing in Hong Kong-related startups and hence help those potential Hong Kong startups that are in the early stages, especially when they are in need of life-and-death capital.”
Continued success across Beyond Ventures’ portfolio companies
Some of the companies Beyond Ventures and the ITVF invested in have advanced to subsequent funding rounds, even potential public listings. The book value of the ten co-invested ventures has increased to 265% of the investment cost. Thus, the buyback from the ITVF brought in over 150% book profit for Beyond Ventures Fund I.
Beyond Ventures exercised the buyback option and only paid the ITVF investment cost plus the accrued interest for ten co-invested startups. The prescribed interest rate was 3.7% last year, and 2.9% in 2019. Alongside subsequent funding rounds from our portfolio companies, Beyond Fund I attained an unprecedented 58% IRR.
Smartsens and YOHO were the two portfolio companies that applied for IPOs with the Shanghai Stock Exchange Science and Technology Innovation Board (STAR Market) and the Hong Kong Main Board while Prenetics plans a US$1.3 billion merger with Artisan Acquisition, a special purpose acquisition company (SPAC) backed by Adrian Cheng, the CEO and Executive Vice Chairman of Hong Kong-listed conglomerate New World Development. This provides Beyond Ventures with a potentially lucrative exit strategy for three companies in the coming 3 – 12 months.
“We were so glad to have Beyond Ventures and the ITVF as our series pre-A investors, because their funding helped us walk through the valley of death,” said Hong Zhu, Co-founder of family robot supplier enabot. “The funding enabled us to launch our first product – Ebo via Kickstarter. And revenue generated made it possible for us to pursue R&D and market expansion, while attracting talent to our management team. All this, along with a concrete product roadmap, then enabled us to attract tier-1 venture capital firms such as Sequoia Capital and LFC to be our Series A investors.”
About Beyond Ventures
Led by Lap Man, Alex Fang, and Marvin Hung, Beyond Ventures is a Hong Kong-based venture capital firm. Started in 2017, Beyond Ventures became renowned from its support by well-known Hong Kong listed companies like Hop Hing Group, Far East Consortium, and Chinney Alliance Group, and leading PE investment management companies Hony Capital and GAW Capital.
The name “Beyond Ventures” originates from the popular Beyond rock-and-roll band in early 1990s Hong Kong. We aspire to revitalize and transform the city’s innovation ecosystem by being Hong Kong’s most impactful venture capital firm. By uniting venture capital experts and local conglomerates with visionary entrepreneurs, we provide startups with the capital and guidance needed to thrive.
Our portfolio companies include unicorn startups like SenseTime, Smartsens, Prenetics, YOHO, etc.
Please go to www.beyondventures.hk for more information on Beyond Ventures.
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