The Singaporean sovereign wealth fund GIC Pte. Ltd. is making a play to enter the Chinese co-working industry by leading a US$14.55 million investment into 5Lmeet, according to a report in the South China Morning Post.
The other lead investor was the Kaifeng Culture Tourism Investment Group.
While 5Lmeet qualifies under the ‘startup economy’, the company was founded by the ex-Vice Chairman of China Vanke, Mao Daqing in 2015. China Vanke is a real estate developer that currently ranks #356 on the Fortune 500 list.
Other founding stakeholders include Sequoia Capital China, Zhen Fund, China Equity and Gopher Asset.
The news comes four months after 5Lmeet raised a US$60 million Series A in October.
An active industry
China’s co-working industry is a competitive sector with both local and foreign players grappling for market share.
New York City’s WeWork — which is reportedly raising anywhere from US$3billion to US$4 billion from Softbank — entered a strategic partnership with TechTemple in June and is trying to gain a foothold in the world’s most populous country.
5Lmeet Founder Mao is already a major player in the co-working industry — having started UrWork in 2015 and seeing it raise US$58 million in January 2017. UrWork has been the source of think pieces asking if it is China’s answer to WeWork.
Other local players like 36kr and naked Hub have backing from major Chinese companies (Ant Financial in the case of 36kr and Gaw Capital Partners for naked Hub).
According to the South China Morning Post, Sun Jianjun, who is the Managing Director for GIC’s China real estate business, used the term ‘upbeat’ to describe the country’s co-working industry.
He specifically pointed to China’s urban centers like Beijing as Shanghai as places where the positive cultural attitude towards co-working presents an opportunity for long-term growth.
While GIC has over US$100 billion in assets, it does have a good investment history in the startup industry. Portfolio companies include Snap Inc., Xiaomi, Ola and Flipkart.
GIC also announced this week it is taking an 18 per cent stake in the Advanced Leading Technology Group — a Chinese company that builds parts for electric vehicles.
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