Monday, May 21, 2012

The rising tide of angel investors - Marc van der Chijs

Marc van der Chijs
Raising your first capital was a major challenge when serial entrepreneur Marc van der Chijs started Tudou, one of China's largest video hosting firms. He works now as angel investor and is happy to see startups have it much easier to get first funding, he tells Gary Yau-Chan of Renselaer in China. 

Marc van der Chijs:
The biggest challenge in the early days was funding the [Tudou] project. It was very difficult to raise money in the very beginning. First year, we were busy with the site, and we didn’t raise any money. The first money we raise was in fact in December 2005. We started in October 2004, so basically 14 months later we raised our first small round. So we had to self-fund the project till then and that was the big challenge. 
Of course, there were many technical challenges. We were the very first company in the world to do online videos and basically we had to really reinvent the wheel. 
Next to that, it was finding a team and make sure these people are happy and stay with the company. The biggest challenge was really to get the funding to get it going. We were lucky enough find IDG Venture Capitals and in the first round they invested $500,000 US dollars but it took quite some time... 
Gary: Do you see more angel investors in China? How about seed programs, or incubators? 
Marc: Yeah a lot more than before. A few years ago, there were very few angel investors. There was AngelVest, which was angel group here in Shanghai and also in Beijing but they were not active at that point. They did some deals but not that many. These angel funds and angel groups have become much more active over the years. There are more companies like Sina.net that are investing now; almost like a trend. I know at least 15 to 20 different angels that I regularly speak to, and a few years ago I only know 3 or 4 of them. It’s really growing. 
However most investors are still risk advise. The average angel investor probably invest $10,000 to $15,000 US dollars per investment, at least the people I know of. It is still different from what you see in the US. It might change over time. 
I am happy to see that it’s changing the whole infrastructure for startups. A few years ago, you had to get VC money because there were no investors.  Now you can raise angel money, and build a company into a bigger scale than you can start raising VC money. A lot more companies are getting funded, that also means more companies would eventually become successful.
Much more in Renselaer in China.

 Marc van der Chijs is a speaker at the China Speakers Bureau. Do you need him at your meeting or conference? Do get in touch or fill in our speakers' request form.
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