China’s Smart Fabric banks $100m in round led by Tencent, Sequoia China

China’s Smart Fabric, which develops a software-as-a-service cloud enterprise resource system for the textile industry, has raised US$100 million in a series C round led by Tencent and Sequoia Capital China, according to a report by China Money Network.

Photo credit: Pxhere

New investors such as Chinese private equity firm CBC Capital also participated in the round, alongside existing backers Matrix Partners China, IDG Capital, 10Fund, and Vision+ Capital, which is headed by Alibaba co-founder Wu Yongming.

Established in 2014, Smart Fabric provides internet-enabled solutions to textile-related companies and connects spinning mill operators and printing, dyeing, and weaving factories with businesses.

The Shenzhen-based startup looks to use the fresh funds to develop new technologies, expand its footprint, and recruit talent, according to the report.

Tencent’s investment in Smart Fabric marks its entrance into another new vertical this year.

In February, it co-led an investment round for Indonesian tech unicorn Gojek, together with Google and JD. Around the same time, the Chinese internet giant was reportedly set to lead a US$150 million to US$300 million investment round for US-based online community platform Reddit. In July, it was reportedly looking to pour US$100 million into Indian streaming service MX Player, along with Indian fintech firm Paytm.

Tencent is currently locked in an internet war with Bytedance. For the past few years, the Tik Tok creator has been growing its app empire, which spans across various categories such as video, social media, education, and gaming.

“Bytedance poses a major threat to Tencent at the juncture of slowing user activity growth for the latter,” Smartkarma analyst Ke Yan previously told Tech in Asia. “Last year, the overall internet users in China only grew by 4% versus 17% a year ago. Meanwhile, Tik Tok’s monthly active users grew more than fivefold.”