China’s Cheetah Mobile has quietly built the world’s largest suite of mobile utility apps, but it’s seldom discussed in startup communities outside of mainland China. That might gradually change, as the company has launched a NT$ 100 million (about US$3 million) seed fund specifically for Taiwan startups.
Cheetah Mobile CEO Fu Sheng revealed details for the fund at the Cross Straits Mobile Internet Conference today, in front of an audience of entrepreneurs and media outlets from Taiwan and mainland China. According to Fu, Cheetah Mobile hopes to help Taiwanese startups similar to how angels in Silicon valley provide money and guidance to early-stage companies. He points to Y Combinator, which bets on teams based on vision and personality, as a partial inspiration for the fund.
“Cheetah Mobile now has 340 million monthly active users. This is basically a giant platform,” said Fu at a press event. “We’ll use this fund to connect with startups that complement us and quickly incorporate them into our promotional system. If their product is really good, then they’ll be able to connect with international users even faster than other teams.”
Cheetah Mobile is best known for Clean Master, a junk file management app that has over 100 million daily active users on Android. It also has released a browser, a security app, and anti-virus app. While the company’s flagship products are all free-to-use utilities, they’re really just conduits to distribute more apps. These apps might be made by other companies which pay Cheetah Mobile to run ads, or they might be apps that Cheetah Mobile has released itself, in hopes of catching Candy Crush-sized revenues.
See: Why China’s tech giants are funneling money into battery apps to go global
Fu added that Cheetah Mobile is creating the fund in an effort to fill a perceived gap in Taiwan’s early-stage investment ecosystem. In his view, while Taiwan has plenty of wealthy companies, few resources exist to support bootstrapped startups.
“If you go to any cafe in Zhonggguancun in Beijing, or CBD in Shenzhen, you’ll immediately hear people discussing startups and investments and dreams. In a cafe in Taipei, you’ll rarely hear this.” says Fu. “Taipei lacks this energy and investment environment. So even if Taiwanese youth have dreams, how can they be fearless? There needs to be a base for fearlessness.”
Taiwan is home to handful of angels and seed-stage funds that make bets on local startups. Pinehurst Advisors and AppWorks Ventures have and continue to invest in young companies, while CyberAgent Ventures and Cherubic Ventures both have staff in Taipei. These entities typically provide between US$500,000 and Us$1 million in funding for new ventures.
Fu also discussed Taiwanese entrepreneurs have some distinct advantages over the ones he encounters in mainland China.
“Mainland Chinese youth are a little more impulsive [than Taiwanese], but impulsive isn’t necessarily a bad thing – they’re maybe more lofty. Taiwanese youth can maybe do things with a bit more dependability,” said Fu. “I think Chinese entrepreneurs are very concerned with user experience and what user’s want. Maybe this person doesn’t know anything about business, but he’ll be able to come up with ideas that users care about. Taiwanese young entrepreneurs, however, when you talk with them, will want to talk about business, or scalability, or profits,” he added.
Given Cheetah Mobile’s large international userbase, its globally-dispersed staff, and the investment habits of its peers, it seems quite likely that the company will begin funding startups in other markets (if it hasn’t started already).
Fu Sheng isn’t the only founder from the mainland to extend a hand across the straits. On his last visit to the island, Alibaba’s Jack Ma expressed a commitment to helping Taiwanese entrepreneurs come to China and start businesses.
