Lawrence Tse of Gobi Partners, a venture capital firm based in Shanghai, addressed the CFA Institute Asia Pacific Investment Conference on Wednesday, where he recounted some key lessons learned from his experience working in China’s VC market. Tse, whose firm focuses on early stage Series A investments, provided an overview of the market and highlighted, in particular, the importance of investing in companies with good management.
Venture capital in China is without a doubt a growth story. The number of active venture capital and private equity firms — an increasingly blurred distinction — has grown from approximately 10 to 4,100. Five years ago, Tse said, it was rare to find a management team that was complete and hiring qualified people was difficult. Today there is a massive industry with a deep pool of talent in China. In a good sign for the industry, the average age and experience level of executives at early-stage firms have increased.