Private credit might be less attractive than it was last year as investors rush into the market, but there are sweet spots to be found.
The new $500 million fund will be used for investments in wireless broadband, technology, media, telecommunications and so-called clean technology. The firm will be looking for investments that will complement the initiatives of its parent company, Intel Corporation, and help expand technology market segments in China.
Intel Capital plans to fully invest the fund within three to five years. It took the firm three years to fully invest its first fund in the mainland.
The launch of this latest fund û which is more than double the size of the original $200 million Intel Capital China Technology Fund û coincides with Intel CapitalÆs tenth year of investing in the mainland. Since 1998, Intel Capital has invested in more than 70 companies across China and Hong Kong.
ôWe aim to foster innovation and local entrepreneurship, while enriching the technical capabilities and global competitiveness of technology companies in the region,ö says Arvind Sodhani, president of Intel Capital.
The latest fund also represents a renewal of Intel CapitalÆs commitment to China, says Cadol Cheung, the firmÆs managing director for Asia-Pacific. It is the firmÆs largest single-country fund anywhere in the world.
ôIntel Capital expects to further increase our investment in China by pursuing business opportunities and participating in larger deals with an eye on leading rounds," says Cheung. ôAs a stage-agnostic global technology investor, Intel Capital invests consistently across all economic landscapes and has a unique advantage in providing value-added benefits."
Intel Capital invests in a broad range of technology start-ups and companies worldwide, including those that offer hardware, software, and services that target enterprise, home, mobility, health, consumer internet, semiconductor manufacturing and clean technology.
Most of the Intel Capital investments were in the US initially, but the firm has been increasingly investing outside the US in recent years. In 2007, Intel Capital invested about $639 million in 166 deals with approximately 37% of funds invested outside the United States. Around 10 years ago, the firmÆs investments outside the US made up only 10% of the total.
Intel Capital tends to look for investments that are relevant to its parent company. The companies Intel Capital invests in tend to be able to help its parent expand the market for its products or provide it with product or service support. The companies could also be involved in emerging technologies that may not be related to Intel CorporationÆs current businesses, but would prove to be useful in a few yearsÆ time.
Intel Capital's first China Technology Fund, which was the firmÆs first fund dedicated to a specific country, has been fully invested in local Chinese companies.
That previous fund has recently made two new investments: Holdfast Online Technology, which provides a platform to host third-party operator LAN-based or console games so gamers can play against each other in a wide area network; and Newauto Video Technology, which manufactures and sells video equipment, network solutions and system integrations for TV stations across China. Newauto also provides digital content editing and sports program live-broadcasting services and is a service provider for the 2008 Beijing Olympics.
Previous investments made by that initial fund include Neusoft Group, Supcon Group, A8 Music, Chinacache International, Chipsbank Microelectronics, DAC, HiSoft Technology International, Kingsoft, Legend Silicon, Montage Technology, and Palm Commerce.
Intel Capital has invested more than $7.5 billion in around 1,000 companies in 45 countries since 1991. In that timeframe, 168 portfolio companies have gone public on various exchanges around the world and 212 have been sold to a buyer or involved in a merger.
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