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Life imitates art as actors become entrepreneurs
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THREE well-known actors in China have started a venture capital fund to invest their money in fledgling companies with promising prospects.
For one of the film stars, Huang Xiaoming, it’s life imitating art. He starred in last year’s popular movie “Chinese Partners,” which told the tale of three college friends who start up an English-language teaching service and strike it rich as entrepreneurs.
Huang and actors Ren Quan and Li Bingbing, who were all classmates once at the Shanghai Theatre Academy, decided they liked the script. But instead of becoming partners in a core product, they became partners in the search for entrepreneurial enterprises.
They pooled 80 million yuan (US$12.9 million) to create StarVC, a venture capital fund aiming to invest in young and innovative businesses with solid prospects and the chance to get in on the ground floor.
“We’re interested in whatever projects might change lifestyles but haven’t become mainstream yet,” said Ren, who heads the fund and acts as its spokesman.
Movie stars who sparkle at the box office often fizzle when it comes to figuring out how to invest rising industry salaries. Many play it safe by investing in their own industries.
In one high-profile example, Sun Li, an actress famous for her role in “The Legend of Zhen Huan,” estimated to earn about 200 million yuan after she bought a 2.6 percent stake in Beijing-based Hairun Media & Entertainment. The group went public via a backdoor listing in the middle of the year and more recently announced a merger with Shenke Co.
In some cases, production companies offer film stars shares to offset skyrocketing salaries in one of China’s most prospering industries.
Ren said StarVC wants to pursue opportunities beyond the entertainment realm.
“What we are looking for are new concepts,” he told Shanghai Daily. “There are so many brilliant ideas out there. Many just need some help in building a brand.”
There is no dearth of entrepreneurs peddling new ideas but short of start-up capital. In the first 10 days after StarVC started up last July, it received 1,552 funding proposals. Many of them involved Internet-related businesses.
Ren said StarVC has already announced funding for three projects, with plans to invest in 10 more next year. In most cases, the fund is part of a consortium of investors.
The three first projects involve the online apparel store Handuyishe, the short-video mobile app maker Miaopai, which is akin to Instagram, and projector supplier Holatek. Negotiations are under way with a fourth candidate, Renren Express, an online crowd-sourcing express delivery platform.
In the case of Miaopai, StarVC was a partner in a US$50 million fund-raising that also included Kleiner Perkins Caulfield & Byers, IDG Capital Partners and SINA Co. Ren said StarVC’s investment came on the advice of IDG Capital.
Ren said StarVC has a shortlist of 20 more potential candidates for funding. They involve sectors such as peer-to-peer online lending, video apps and online education. He added they had even considered more on wearable devices and robots.
Ren, who starred in dozens of dramas, including director Feng Xiaogang’s “Assembly” and actor Chow Yun-Fat’s 2010 movie “Confucius”, is no stranger to the world of finance.
He started investing in food and beverage stocks as early as 1997, and later enrolled in the Cheung Kong Graduate School of Business.
Ren said he typically holds less than a 5 percent stake in the ventures the fund finances. He often lends management assistance to fund recipients.
Next year, StarVC plans to broaden its membership by adding additional investors. Encouraged by the favorable publicity surrounding StarVC, other celebrities from the entertainment industry might well be eager to become investors in the fund.
As for juggling careers, Ren said he is not pursuing acting roles anymore. He is devoting most of his time to the fund.
“I have more important things to do,” he said. “I don’t care about being a popular celebrity anymore. Investing is more enjoyable than acting.”
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