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36Kr has exclusively learned that Zhuichuang Venture Capital (Zhui Chuang Robot Industry Venture Capital Fund) recently completed the first round of fundraising for its mid- and early-stage incubation fund, with a total size of RMB 1 billion.

This fund is an incubation fund under Dreame Technology. It will focus on the pan-robotics field and invest in robot projects incubated by Dreame internally, as well as external projects that are willing to replicate Dreame's systematic approach. In addition to Dreame Technology, the LPs of this fund also include Guosheng Fund, local state-owned assets, industrial groups, and some market-oriented family offices.

It is understood that in addition to the mid- and early-stage incubation fund, Dreame has also established a growth-stage strategic fund with a target size of 10 billion RMB. The fund was jointly initiated and established by Dreame Technology and the local government.

In the world of sweeping robots, Dreame, which was founded in 2017 and received the largest investment of 3.6 billion in the smart cleaning industry in 2021, is an extremely distinctive and ambitious company. From the earliest sweeping robots to cordless vacuum cleaners, to smart floor scrubbers, high-speed hair dryers, and then to some commercial robots, Dreame is more like a broad-based robotics company.

In the view of Lei Ming, partner of Zhuichuang Venture Capital, the incubation of Zhuichuang Venture Capital has output the systematic capabilities of Dreame in terms of rapid growth in technology research and development, supply chain, and organizational management. At the same time, CVCs with the need to expand production capacity are more compatible with those with the need to attract investment. The combination of the two has led to the birth of CVCs such as Zhuichuang Venture Capital.

Lei Ming regards CVC, AI+Robots and globalization as the core labels of Zhuichuang Venture Capital, and believes that "the biggest beta of the times in the next few years and decades will be AI+Robots and globalization."

In 2023, this investor who had invested in companies such as NIO, Pop Mart, and RELX at Huaxing New Economy Fund completed an important transformation from Huaxing to Zhui Chuang Venture Capital.

The following is some introduction and summary of Zhuichuang Venture Capital and the primary market by Lei Ming, partner of Zhuichuang Venture Capital:

1. It took only three months for this mid- to early-stage incubation fund of Zhuichuang Venture Capital to complete the first stage from the start of fundraising. In addition to this incubation CVC fund, Zhuichuang Venture Capital has also previously established a growth-stage strategic fund with a scale of RMB 10 billion, and most of the funds have been raised.

2. In terms of the selection of invested projects, the two funds have different focuses. The mid- and early-stage incubation fund focuses on early-stage projects, helping entrepreneurial teams to set strategies, recruit teams, output supply chain capabilities and management models, and promote rapid iteration of projects. The growth-stage strategic fund focuses on expanding application scenarios with relatively mature commercialization, such as smart cleaning robots, garden robots, smart cars, and smart short-distance transportation. Through such a layout, after the mid- and early-stage incubation fund invests in early-stage projects, the growth-stage strategic fund can continue to provide follow-up assistance to the invested companies and increase certainty.

3. In my opinion, incubation CVC funds are a new species in the venture capital circle, and also a new solution for venture capital in the current primary market in China. Because the CVC model can well balance the needs of government-type fund investment. Both the mature businesses pursued and the new businesses incubated have clear needs for capacity expansion and need to land projects. Compared with the logic of forcing an industry to land in a certain place in order to complete the return of investment, this method is driven by business needs and is a smoother positive logic. For enterprises, not only is there no additional cost, but also the best supply chain.

4. In addition, compared with traditional VC investment, CVC can help entrepreneurial teams set strategies, recruit teams, provide supply chain and sales capabilities, export management models, and promote rapid iteration and development of early projects. In the current environment, the success rate of projects will be significantly improved by adopting strategies that have been verified by the market. Therefore, compared with pure financial investment, CVC can provide greater certainty.

5. It is a stereotype that only giants can do CVC. Now many medium-sized companies can also do CVC, and can empower the invested projects based on supply chain capabilities and systematic management capabilities. Especially from the perspective of fundraising, in the current environment, compared with pure financial investment, industrial CVC with manufacturing capabilities and state-owned assets are relatively more compatible.

6. DPI is the biggest pain point of the venture capital industry in the past few years. In the past, when investing, people usually thought that good projects should be continuously increased, and the result was that most of the funds were left standing at high positions. Although Zhuichuang Venture Capital is a mid-to-early stage fund, it will put DPI first, because when we enter, the valuation can be lower than the market. If there is good financial performance in the next round, we will start to exit. The general principle is to let LP recover the principal as soon as possible.

7. We will focus on the industry, invest in AI+robots, and invest in globalization, and strive to achieve the ultimate in these core points. We are currently in a critical period of robotics technology transformation. As a disruptive product that is expected to start the next major industrial cycle, humanoid robots have a potential market size of trillions of dollars. Of course, it is still in the early stages of development and it will take time for them to enter the home scene.

8. It is different from autonomous driving in that it canto 1,It is difficult to commercialize autonomous driving because it has a huge impact on life. However, there is a lot of room for humanoid robots in this area, and some vertical scenarios can be implemented first. For example, high-value retail scenarios, factory human-machine collaboration scenarios, etc. The work in these scenarios has standard SOPs, which is to use people as machines. Robots can completely liberate people from tedious and repetitive labor.

9. However, it may take another 5-10 years for humanoid robots to enter the home scene and explode on a large scale. Therefore, in addition to humanoid robots, we have also laid out the subdivided opportunities in the entire AI+robot track.

10. Regarding globalization, the theme of globalization was not that hot when I was at Huaxing, but I had already made it one of my core investment directions. It was based on the global perspective that I invested in Dreamie in Huaxing in 2020. At that time, Dreamie had not yet completed its C round of financing of 3.6 billion yuan, and I invested in it before the market consensus.

11. In the past two years, Chinese enterprises going overseas has been a very hot topic. When I chatted with some friends in the secondary market of US dollars, I found that everyone is optimistic about the ability of Chinese enterprises to "roll" in the world under the current environment. This is basically a consensus. In the early days of Dreame, the competition in the Chinese market was already fierce, while the degree of globalization of Chinese brands in overseas markets was relatively low. Therefore, Dreame chose to cultivate its brand in overseas markets first, and first laid out the European market.

12. At that time, the overseas robot vacuum cleaner market was dominated by iRobot, but Dreame defeated iRobot in countries and regions such as Germany, Italy, and Singapore, and took the absolute first place in market share. Moreover, it used a more high-end approach such as benchmarking against Apple and Dyson. Dreame's brand is the most expensive in the same category worldwide, and its price in Europe is almost twice that of iRobot. Under such circumstances, it achieved the first place in market share, instead of using the traditional low-price, cost-effective model. The biggest advantage of this choice is that Dreame did not burn much money in its past development, even in the early days.

13. We believe that the quality of fund performance essentially depends on whether it can capture the biggest beta of the era during the investment period. Twenty years ago, this beta was the Internet, fifteen years ago it was mobile Internet, the past six or seven years it was new energy vehicles, and in recent years it was semiconductors and chips. In the next few years and decades, we will see AI+robots and globalization, and these opportunities are parallel.