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Granite Global Ventures boosts team and tops up third fund

The US- and China-based private equity firm has raised an additional $200 million for its third fund 16 months after its final close, while simultaneously adding four people to its investment team.

Granite Global Ventures, a private equity firm which invests in China and the US, has raised $200 million (€126.6 million) more for Granite Global Ventures III, an expansion stage fund which it had closed on $410 million in October 2006.

The firm has also hired four partners from SIG Capital, a Shanghai-based private equity firm which manages Venture Star Shanghai, a Sino-foreign joint investment fund. Zhuo Fumin and Jessie Jin have joined the firm as managing partners, while Michael Kuan and Steve Chu have assumed the role of venture partners. The four will continue managing Venture Star Shanghai as well.

Jenny Lee, managing partner at Granite Global Ventures, told PEO the fund had originally closed on $410 million and the additional $200 million was raised because “this is the best time to invest” and to “capitalise on the opportunities” available. The top-up capital will be used to focus on

This is the best time to invest.

Jenny Lee, managing partner at Granite Global Ventures

investments in the manufacturing sector and other sectors that are driven by consumer demand in China, as well as traditional focus areas such as internet, technology and services.

“Through the increase in our fund size, we are strongly positioned to increase our investments in these new consumer-driven markets, as well as in our traditional industry sectors,” Hany Nada, managing partner and co-founder of Granite Global Ventures, said in a statement.

The additional capital has been raised from existing investors who have increased their commitments. Lee said that a majority of the limited partners are based in the US and Europe and they mainly consist of university endowments, pension funds and fund of funds. Investors include AlpInvest Partners, Pantheon Ventures, Stanford University and CalPERS.

The four partners who have joined are all based in China and will work on investment opportunities in the country.

Lee said that the injection of more capital and the presence of a bigger team will allow Granite Global Ventures to make the most of the growing investment opportunities in China.

Granite Global Ventures now manages a total of $1 billion. The firm’s previous fund closed on $230 million and is fully invested.

Fund III has invested in 16 deals thus far, deploying about 20 percent of its capital. The fund invests in both China as well as the US.