Sina Tech reported on Wednesday that, according to chat records of several insiders, Beijing-based investment company Hillhouse Capital is making indiscriminate layoffs, mainly involving employees of varying ranks in the primary market group. A spokesperson for Hillhouse Capital subsequently denied the news in a response to domestic media, calling it a rumor.
Hillhouse Capital Group, founded by Zhang Lei in 2005, focuses on long-term structured investment. Offices have been set up in Beijing, Hong Kong, New York, California and Singapore. The company’s investment covers health care, consumption and retail, TMT (technology, media, and telecom), advanced manufacturing, finance and enterprise services.
In Sina Tech’s report, a VC partner said that the rumors of layoffs are basically true, and that Hillhouse Capital current plan is “to cut the consumer group completely, optimize the TMT group and turn to science and technology fields.” The above-mentioned partner also said that last year, some leading funds in the industry also cut off whole teams of consumption and education fields.
In a leaked screenshot involving a Hillhouse employee, a message reads, “I just completed the portfolio review a few weeks ago. Now I should have been reading the investment data. Layoffs have been carried out from the middle level management to junior employees.” The individual said that the portfolio review report had just been completed a few weeks ago and was then informed of being laid off last night. Further updates from the “boss” are now being awaited.
It is worth mentioning that on Tuesday, some domestic media outlets reported that a famous investor named Allen Zhu had posted part of an analysis report on the VC situation in his WeChat Moments, saying, “This year’s VC situation in China is grim. Cheer up! Brothers on the road to fundraising!”
The report mentioned by Allen Zhu showed that, venture capital funds focusing on investment in Southeast Asia and India have raised $3.1 billion this year, close to the $3.5 billion raised last year, and 47% more than the VC funds focusing on China, according to the data of research company Preqin. At present, the amount of VC financing invested in China this year is about $2.1 billion, dimming any hopes of achieving last year’s total of $27.2 billion.