Six months after receiving an angel investment, Yusen Dai’s first project failed. Bob Xu had put in $200,000 when other investors turned the team away. Now Dai and his partners had only RMB 300,000 left. They changed direction and built Jumei, the beauty e-commerce business that listed in New York in 2014. An investment in a particular plan had become an investment in the people capable of abandoning it.
Dai tells this story in his ZhenFund biography. He also includes the less flattering sequel: after the listing, Jumei’s value fell by 90%. He joined ZhenFund in 2017. The account is useful because it contains both the triumph and the bill. Early investing requires judgment about a team’s capacity to learn; even a successful pivot cannot promise a comfortable ending.
- ZhenFund writes early checks to Chinese founders building at home and overseas.
- Its summer grants offer RMB 200,000–500,000 for eight to twelve weeks of startup work.
- Camps, campus conversations and portfolio support help founders navigate the unfamiliar.
- A reported smaller eighth fund points toward more concentrated investing.
The teacher’s instinct
There is an educational lineage here. Bob Xu and Victor Wang had helped build New Oriental before establishing ZhenFund with Anna Fang in 2011, with Sequoia Capital China’s involvement. Former students came back asking Xu to support their ventures. The people once seeking instruction were now seeking capital. Teachers who had watched ambition develop were being asked to price it.
Fang arrived by a less obvious route. A Stanford business-school connection introduced the opportunity. She recalls answering, “I don’t even know what an incubator is.” Her first day brought a meeting with a backpack travel startup. The question of whether to invest caught her imagination. A career she had not planned became work she wanted to keep doing.
That origin helps explain the firm’s emphasis on founders, but it does not turn investment into charity. ZhenFund supplies capital to companies with growth ambitions. Its public portfolio spans Xiaohongshu, Perfect Diary, autonomous-driving businesses and AI companies. The products vary wildly. The recurring decision is whether a particular group can turn an early insight into something customers will use.
A summer with a budget
For a student, the obstacle can be wonderfully mundane: there is no money to spend the summer building. Zhen Summer Grant gives selected teams RMB 200,000–500,000 and an eight-to-twelve-week working period. In September 2022, investor Yuan Liu said the scholarship initiative had drawn hundreds of applications, with applicants ranging from 16 to 30. Four had received the first awards.
A program budget and duration, rather than a promise of commercial success.
The distinction matters. A finite grant buys a period of concentrated work. It does not establish that a product has a market. The useful habit to copy is setting a budget and a deadline for an experiment: what can the team learn before the money runs out? A founder without access to ZhenFund can still borrow that question.
The firm also offers shorter encounters. ZhenResidence, operating since 2014, runs three-to-five-day camps in Beijing, Shanghai and Shenzhen. Its website reports 13 editions and roughly 400 participants. ZhenCampus brings startup discussions onto university campuses. These programs make the first conversation less forbidding, while allowing investors to meet people before a polished funding presentation exists.
In December 2023, ZhenFund announced it was setting aside RMB 100 million for founders born after 2000. The announcement reported nine summer-grant recipients or teams and more than 3,000 students in its campus community. Those figures describe an effort to find young builders early. They should not be mistaken for a count of successful companies.
The business behind the belief
ZhenFund sits at the uncertain end of venture capital. Its summer grants and preparation camps give it ways to meet founders before they have the sales history a later-stage investor would examine. Founders receive investment and support; the fund’s investors provide the underlying capital. Equity stakes can gain value as companies grow, raise later rounds or exit. A founder therefore trades some ownership for financing. The attractive part is room to build. The obligation is to build a business capable of making that ownership valuable.
The firm’s manifesto favors quick decisions, friendly terms and loyalty. Its practical support has included hiring, marketing, legal and financial advice. These are useful services when the person designing a product suddenly becomes responsible for employment contracts, fundraising and an office. A founder’s calendar acquires astonishing variety once other people depend on it.
Consider a June 2025 gathering with Stripe in Shenzhen. Nineteen portfolio executives discussed international expansion and payments. The subject was pleasingly unromantic: a global product still needs a way to collect money locally. Stripe’s Paul Harapin warned against assuming success in China would automatically translate to Japan, where buying habits, decision times and partner relationships can differ.
This is where investor introductions can earn their keep. A conversation with someone who understands a market may change a launch plan before an expensive mistake does. Equally, advice and capital have limits. A company entering a slower market without sufficient time or money can struggle even when its technology works.
Fewer bets, sharper questions
The financing environment supplies another constraint. In April 2026, ION Analytics reported that ZhenFund was preparing to close an approximately $300 million eighth fund. Its sources said the vehicle was oversubscribed, but deliberately capped below the $400 million seventh fund, partly to build a more concentrated portfolio. The report described an imminent close, rather than a completed one.
That reported choice complicates the usual story in which an investor’s progress is measured by a larger fund. Concentration means fewer opportunities can absorb more attention. Whether it produces better returns depends on the investments. For founders choosing among ZhenFund, other seed investors or individual angels, the useful question is what support accompanies the check.
“We believe that done is better than perfect.”
ZhenFund’s published manifesto
Belief needs a practical test. In a 2022 interview, Yuan Liu described looking for founders whose experience fits the problem, who can learn, and who can assemble a team. He also asked who the product serves and what users will pay. The first check creates an opportunity to answer those questions. The second act belongs to the founder who listens.