Meet Nubank, a fintech shop out of Brazil that just raised $180 million from Tencent at a valuation of $4 billion. Forget the fact that the round is half secondary. It’s an enormous transaction, and in more normal times, it would cause a big stir.
However, the capital event highlights something notable about Tencent: the China-based company’s investment cadence is staggering. Tencent is disbursing cash at a far faster rate than Alibaba, another Chinese tech shop that isn’t famous for parsimony.
Tencent’s Early Christmas
Tencent has been on a check-cutting binge recently, getting through eight investing rounds in September. Those ranged from a $1.5 billion deal with Lianjia (real estate services), a $450 million round for MissFresh E-Commerce (mobile grocery sales), to the comparatively staid $90 million Series B for WeShare (fintech something or other).
October is looking similarly hot. Tencent is at four deals so far, and the month isn’t even half done. Here’s the list:
- October 1. Miniso’s 1 billion rmb Series A.
- October 4. Voyager Innovation’s $175 million private equity round.
- October 5. Bilibili’s $317.6 million post-IPO equity event.
- October 8. Nubank’s $180 million Series F (half secondary).
Regarding Nubank, TechCrunch’s Jon Shieber has the story, including why the Brazilian and Chinese companies are swapping shares for cash:
[Nubank cofounder David] Velez stressed that Nubank, which had raised $150 million in a February financing round led by DST, did not need the additional capital. “We found so much value in partnering with Tencent,” Velez said. “Particularly everything there is to learn about the Chinese financial market.” Velez hopes to take those lessons and apply them back to the market in Brazil.
All in all, here’s what we can tell you: Tencent is moving very fast. Alibaba, in contrast, doesn’t have a known investment since August of this year. It had two in July, two in June, two in May, one in March, and just one other in February.
For context, Tencent executed more investments in September than Alibaba has managed all year, and Tencent managed twice as many deals as Alibaba pulled off in Q1 in just October to date.
In short: This all seems a bit excessive.