Plus Wu of Shanghai-based Vickers Venture Partners on the venture capital scene in India & China

Plus, tell us about your background. We understand that you were involved with an online travel portal earlier.

I have an engineering background and I was an entrepreneur before. I also worked at qunar.com, a travel search engine prior to joining Vickers. By the way, Qunar recently got a $300 million investment from Baidu and ClearTrip, the kayak.com equivalent, also got funded. The sector in both markets is quite interesting.

Also, tell us more about Vickers Venture Partners.

We’ve been around for several years and are based in Shanghai, with an office in Singapore as well as a new satellite in Los Angeles. Our partners have a great track record and are extremely experienced in the VC space as well as other industries. Our focus is on early stage companies in Asia. This is where the emerging economies are – Indonesia, Vietnam, Cambodia, and of course, China and India. There are plenty of high growth opportunities here.

Which sectors does Vickers invest in?

We cover a range of industries. Right now, we’re excited about mobile and gaming. Mobile is a big and booming market in China, and we have two well-performing mobile portfolio companies, Tenfen and Babeeta. In the gaming space, we recently made an investment in Spicy Horse and the company is developing a 3D version of Plants vs Zombies for gaming giant, Popcap.

You’ve been with a startup and now, you’re a VC. How different is it?

When I worked with a startup, it was good for me to see the operations of a company from inside. Now, I work closely with startups and I see the organizations from outside, from the top. I also used to be an entrepreneur when I was in college. So, these are all different roles and I’ve enjoyed and learned much from all these experiences.

What is the investment space like in China and how do you see it evolving?

There are some angel investors around. But by far there aren’t enough. The ecosystem would require more angels. I would say that the market is competitive but the good VCs will come out on top. I believe that Vickers will be amongst the good ones.

Where do you see maximum traction right now?

Similar to the rest of the world, group buying is booming. The same is true of lots of e-commerce sites. There might be several teams working on the very same idea. But one will eventually stand out and maybe, go public. The other survivors may get acquired by China's internet giants like Tencent or Baidu. Additionally, there are also many buyout opportunities from overseas. The competition is tough. But you can see plenty of opportunities because the consumption power is growing in China, and it will continue to grow. I think the same will happen in India, or it may already be happening right now.

If you compare the Indian & Chinese markets, what do you realize after your initial days in India?

It looks like India is around five years behind China. This is with respect to the market penetration (e.g. internet connections) and also, the eco-system. As an example, you can take one of India's top success stories from the internet space like MakeMyTrip and compare it withctrip.com from China. Ctrip went public in 2003. MakeMyTrip happened only last year. So, you can say that there lies an eight-year gap. Then, when you compare Cleartrip to Qunar, there lies a five-year or four-year gap. You can see and feel that the gap is getting smaller and India is going at a fast pace. What I’d like to figure out is whether the Indian consumers are ready for this new market.

You spoke about the mobile space being huge in China. How do you view India in comparison to that?

China seems to be on a fast track. On the metros of Shanghai, you can see a lot people are holding their handsets with a big touch screen. But I hardly see smart phones in the public transportation system of India, even though I can see a lot of iPhones at the airport. But at least people are getting cell phones and soon they will be able to have access to better ones. I think it will happen soon as India is investing a lot in the infrastructure.

Have you found some business ideas in India which could work in China as well?

Not yet, I am still searching. Actually, I’m more interested to find out which model from China could work here! The best ideas still come from Silicon Valley even today. But I hope to see more original business ideas and innovations from “Chindia”.

To know more about Vickers Venture Partners, click here. Also, do let us know what you think of this story by writing to us at[email protected].

Wolfgang Bergthaler | YourStor