Shanghai-based ClearVue Partners, a growth capital firm, has led a $20 million investment in China’s fruitday.com, a fresh fruit shopping site in China, according to a ClearVue statement.
SIG Asia Investments LLLP was also involved in the investment.
Despite the relatively high valuations in China’s ecommerce sector, ClearVue found Fruitday’s valuation reasonable and its use of cash prudent, Harry Hui, managing founding partner, told Private Equity International.
Hui added that the founder’s father had been in the traditional fruits business in China and the son decided to reinvent the family business and move into the higher end. Now 90 percent of products are imported and the bulk of sales are through ecommerce.
“The company is growing [revenues] about 100 percent quarter-on-quarter and it’s already a five-year-old company,” Hui said. “Chinese consumers are willing to pay for food that is consistently high quality,” he said.
In China, total consumption of fresh fruit in the urban markets is estimated to have been RMB 400 billion (€47 billion; $64 billion) in 2013, with an annual growth rate of about 15 percent, according to the statement. The imported fruit sector is growing at 40 percent annually.
In February, ClearVue raised $262 million for its debut fund, exceeding its $200 million target, according to an earlier statement.
The firm has already done 10 deals, Hui said. ClearVue writes equity cheques of $10 million – $25 million, which makes them post-venture stage investors, targeting companies with proven concept, revenue and a proven management team “but not quite at the pre-ipo stage”, Hui explained.
“We’re growth capital investors and that’s why entrepreneurs are responding to us because there’s less competition in this band of equity cheque.”
The firm is also set up to do buyouts and several team members have M&A experience with multinationals such as Pepsico and Nestle China.
Shanghai-based ClearVue Partners is focused on growth capital investments in the consumer sector in Greater China, with an emphasis on the food & beverage, consumer lifestyle, and internet/mobile sub sectors.
ClearVue also has a strategic relationship with Greenwich, CT-based Catterton Partners, a 25-year old, private equity fund with more than $4 billion under management that focuses on buyouts of mid-market consumer businesses in North America.