Veteran venture capitalist Jenny Lee made her mark backing some of China’s top tech startups. Now Southeast Asia may offer her similar early-stage opportunities in the region’s fast-growing digital economy.
As much of the world went into a standstill at the height of the pandemic in 2020, veteran venture capitalist Jenny Lee, 50, hunkered down in her hometown in Singapore to raise money for four new funds being launched by her firm GGV Capital. For four months, Lee barely slept as she made over 250 zoom calls that raised $2.5 billion—a process that usually takes six months—and all done remotely from investors around the world.
The funds raised by Lee and her team was the highest ever in GGV’s 22-year history, increasing the firm’s assets under management by 27% to an all-time high of $9.2 billion. Lee, who runs all of GGV’s U.S. dollar fundraising, takes pride in the results. “It’s all worth it,” Lee says in an interview in June at the GGV Capital office in Singapore. “If I can raise $10 million per call, I’ll do it every day.”
Investor confidence in GGV arises in no small part due to Lee, who has been named by Forbes as one of the world’s top 100 venture capitalists for 11 years in a row, from the first year she was included in the Midas List in 2012. “She has cemented her reputation as one of the most respected VC investors in the country—and the world,” it was noted on this year’s list. She was one of 12 women to be selected, and was only one of four 11 years ago. For her success, especially in a male-dominated field, she has also been included in Forbes’ list of the World’s Most Powerful Women three times and Forbes Asia’s Power Businesswomen list in 2019.
She is surrounded by top-tier VCs at GGV, of which she is one of six managing partners that run the company, including global managing partner Singaporean Jixun Foo, known for an early bet on regional superapp Grab. Another high-profile managing partner looking at investments in Asia is Hans Tung, a Taiwanese American who has been on the Midas List ten times. The others on the team bring expertise in areas such as U.S. investments, sector knowledge and hands-on entrepreneurial experience. The firm claims its funds have delivered an average annual gross IRR of over 25% since the company’s founding in 2000.
The 354 companies in GGV’s portfolio are balanced almost equally between those in Asia-Pacific and the Americas (GGV claims its investments include more than 85 unicorns). China is home to the highest number of Asian companies in the portfolio, with 77 investee companies listed on its site—only the U.S. has more investments, at around 130.
While Lee got her start as a venture capitalist at Morgan Stanley and Jafco Asia, it was in China where Lee cemented her reputation soon after she joined Menlo Park, California-based GGV to launch its office there in 2005. At the time it was GGV’s second overseas presence (the firm opened a Singapore office in 2000 and closed it 13 years later). It was an early sign of the firm’s confidence in Lee’s potential to pioneer a crucial market.
From a base in Shanghai, she and Foo spearheaded or were involved in a string of investments—usually at early low valuations—into what became some of China’s most important tech firms, such as electric vehicle maker Xpeng Motors and handphone maker Xiaomi. One of Lee’s flagship investments was in 2013 into Kingsoft WPS, a Chinese software maker, which so far has generated a whopping 55x return for GGV as of the latest calculation early this year. The ability of Lee and the team to be adept in identifying emerging technologies helped them pick future unicorns. “We’ve stayed very close to the forefront of technology to be able to understand what [the next big thing] could be,” she says.
GGV Capital has grown its assets under management more than 50 times since its founding in 2000, under the original name of Granite Global Ventures, later shortened to GGV.
Lee arrived in China just as it was transitioning from PC-based tech (internet cafes were all the rage) to a mobile-based tech ecosystem. To unearth investments, Lee and her China team used to tear apart smartphones, identifying the makers of critical internal components and then invest in them. One of these was China-based AAC Technologies, a key supplier of audio sensors for Apple’s iPhones. “As a result, we were able to invest in [companies] with cutting-edge technologies very early,” Lee says.
Lee also had to rise to the challenge of operating in one of the world’s toughest—and most promising—markets for venture capital. Although she had studied Mandarin while growing up in Singapore, she admits she struggled with the language upon arrival. What’s more, she represented a firm with no history in the country, and she had no network of contacts of her own. In a 2020 interview posted on the GGV site, she said: “We had to learn—learn to read business plans in Chinese [and] learn to understand the technical jargon.” The entrepreneurs she met helped too. “They were the ones who taught me to speak, how to use the right phrases in Chinese, and, of course, I helped them with their English.” Thus she found a way forward: “You go in fighting, you go in scared, knowing that you are starting at ground zero, at the base.”
Another hurdle was China’s business culture. Back then, the economy was still cash-based, and credit cards and e-payments had yet to become commonplace. Lee had to carry cash in suitcases to pay staff, who “took that leap of faith to join GGV,” she said. “No one knew GGV.” In the same 2020 interview, she glimpsed the rigors of entrepreneurship in those early days: “In a way, I understand what startups have to go through.”
“If I can raise $10 million per call, I’ll do it every day.”
One early bet in 2005 was Chinese firm HiSoft (now Pactera), an IT outsourcing services firm in a sector dominated by Indian firms such as Infosys. To grow the company, she hired industry veteran and fellow Singaporean Tiak Koon Loh as CEO the following year. Loh—who previously managed Hewlett Packard’s IT outsourcing business in China—steered HiSoft through its Nasdaq listing in 2010, paving the way for GGV to exit with three times return on their investment. “Jenny felt that HiSoft could be a global business,” says Loh, who remains CEO. Pactera is now owned by the government firm China Electronics Corp. and is the mainland’s biggest IT outsourcing firm with annual revenues over $1 billion.
Finding HiSoft is an example of Lee’s adherence to deep due diligence. At the time, China’s government was supporting the IT sector with dozens of high-tech parks scattered around the country. Lee systematically visited them one by one, chatting up the directors to ask them to cherry-pick the top firms in their park, and then meeting with each of those companies. At a park in Dalian, she endured a boozy seafood dinner with rounds of powerful baiju liquor. At another, she joined in a golf game that led to signing a term sheet on the green. “It does take extra effort,” she has said. It paid off as HiSoft was among the companies she met.
Though her Mandarin and network needed a boost, Lee did bring to China a strong business and technical background. After growing up in Singapore, Lee went to the U.S. to earn a bachelor’s and master’s degree at Cornell, studying electrical engineering and graduating in 1995. The same year she got work as an aircraft engineer at Singapore’s ST Aerospace where she modified F-16 fighter jets. “Every day, I was out in the sun, hanging out with the technicians and the fighter jet pilots. It’s kind of fun actually,” she said in a GGV blog.
As a rising star in the state-owned defense contractor, the company sent her four years later to attend Northwestern University’s Kellogg School of Management where she earned an M.B.A. in 2001. But Lee had long nursed a desire to become a venture capitalist, so that same year, Lee quit her job to pursue her hidden passion.
It was a calculated risk as the global economy was going deeper into recession at the time—and it came with a hefty price. She paid ST Aerospace a penalty fee of $300,000 for not completing the company’s 11-year scholarship bond, which paid for her bachelor’s and master’s degree as well as M.B.A. Lee has no regrets. “It was actually the best move,” she says.
In 2019, Lee and Foo—who had been investing in Southeast Asia since 2005—decided to reopen GGV’s Singapore office, attracted to the region’s fast-growing digital economy that spawned many of today’s unicorns. The reopening was unfortunately timed mere months before the pandemic hit. One of the biggest priorities in the following year was her historic capital-raise, which GGV had not done in any major way since 2018, when Lee raised $1.88 billion.
“You go in fighting, you go in scared, knowing that you are starting at ground zero.”
The new office in Singapore signals the growing profile of Southeast Asia in the global VC industry, as China loses its luster amid a slowdown and tensions with Washington. Adding the Singapore office is an ideal perch for GGV to scope out promising startups and technologies across the region. The city-state also has its own impressive tech scene, with 12 unicorns and more than 9,300 startups, the highest of any Southeast Asian country, noted KPMG and HSBC in a July study. “Singapore stands at the forefront of Southeast Asia’s new economy,” it said. And just next door is Indonesia with its $1 trillion-plus economy and unicorns such as GoTo and Traveloka.
GGV has already deployed half of the $2.5 billion of its new capital from 2020. Among the Southeast Asian companies getting funded are Singapore’s fintech firm Thunes, alternative meats startups Next Gen Foods and Growthwell as well as edtech companies Ruangguru from Indonesia and Azota from Vietnam.
Lee added another feather to her cap when Temasek appointed her to its board in January as its youngest-ever member. With her role at the state-linked investment firm, she is fulfilling a vow made to her ex-boss at ST Aerospace, who told her when she resigned in 2001 that she “should come back when the country needs you.” Lee believes she can now add value to Temasek as it seeks to boost investments in innovative and emerging technologies across Asia and the world. “It’s an honor to come back to Singapore and contribute in ways that I can,” she says.
One of Lee’s more successful discoveries wascellphone maker Xiaomi before it had sold its first handphone. In 2010, GGV held an event in Shanghai to celebrate a decade since its founding. Alibaba’s Jack Ma attended as did Xiaomi founder and CEO Lei Jun. Lei and Lee already knew each other, but at the time he was an angel investor after he built two successful companies, one sold to Amazon and the other listed on the Hong Kong stock exchange. The two met at the event and Lei revealed to Lee his idea for a startup cellphone company, for which he had a primitive prototype. The pair wound up deep in conversation until midnight, after most of the guests had left. Lee came away from that meeting convinced Lei was worth backing, and recommended that GGV invest in the startup.
Lee became an angel investor first while GGV later bought a stake. “You could understand that he’s going to make a phone for the Chinese population that is going to have a better user experience,” she said in a Forbesinterview in 2015. The bet paid off, and Xiaomi now ranks as one of the world’s top handphone makers and Lei’s net worth hovers around $10 billion. “Venture is sometimes about looking at the guy in his eyes and seeing his passion and his wanting to win,” she has said about that fateful meeting with Lei. As the controlling shareholder and chairman of Kingsoft, he also brought Lee her best startup investment in Kingsoft WPS.