Shanghai-based private equity firm ClearVue Partners has raised its first private equity fund, securing $262 million of capital commitments to invest in China’s consumer sector, according to a statement.
The fund was launched in August 2012 originally targeting $200 million and made a first close in early 2013, having raised about a third of its target.
ClearVue has a strong focus on China’s consumer sector, in particular food and beverage, consumer products, internet and mobile. The firm's two founders having extensive experience in the consumer sector.
The vehicle has a mandate to invest in both onshore consumer businesses and offshore businesses that have potential to expand in China.
“The consumption story in China is irreversible, its share of GDP will continue to grow as consumers continue to trade up,” Harry Hui, founding managing partner of ClearVue, said in a statement.
Despite the first time fund having no track record, it attracted an impressive lineup of investors, including Fidelity Growth Partners, Emerald Hill Capital Partners, Harbourvest Partners, AUDA, JPMorgan, as well as a number of endowments and family offices, according to the firm.
Hui told Private Equity International that while LPs asked questions about track record, they ultimately invested due to the personal experience of the founders and their knowledge of the consumer sector.
“The due diligence was very thorough,” he said. “When they due diligenced our personal track records, the fact that the combined experience of our team was 60-plus years of operating, investing and consulting experience in only the consumer sector, they felt it was a very unique DNA. Investing in consumer is different – it is not something you can [simply switch on].”
LPs were also concerned with the specific nature of the fund, dedicated solely to the consumer sector in China, Hui added.
“The first consideration was whether a consumer fund was too narrow. But [LPs] realised that it was still 35 to 40 percent of [China’s] GDP – and that is a big number.”
ClearVue Partners was founded in 2012 by Harry Hui and William Chen.
Hui was previously chief marketing officer of Pepsico Greater China, former president of Universal Music in Southeast Asia and managing director of MTV North Asia. Chen was one of the founders of Billpoint, an internet payments company acquired by eBay in 1999, and most recently was managing director at private equity fund DT Capital Partners.
The fund has already closed a number of deals. While Hui would not disclose the percentage of the fund deployed, he said the firm is “on track” with expectations. Its investments include online grocery store Fields, a Chinese beauty brand, and US-based restaurant chain Outback Steakhouse, which will expand its network into China.