DCM Opens $100 Million Android Fund With Japan’s Gree and KDDI
Dixon Doll’s venture-capital firm and three Asian technology companies are starting a $100 million fund to finance startups focused on applications and services for Google Inc. (GOOG)’s Android operating system.
The “A-Fund” will be managed by Doll’s DCM, and include funding from Tokyo’s Gree Inc. (3632) and KDDI Corp. (9433) as well as China’s Tencent Holdings Ltd. (700), the companies said today in a statement. The fund is open to startups of any size in any country that are building for Android.
DCM’s fund comes three years after venture firm Kleiner Perkins Caufield & Byers started the iFund for developers targeting Apple Inc. (AAPL)’s iPhone. Kleiner Perkins doubled the fund to $200 million last year in anticipation of the iPad tablet computer. DCM is betting on Android, which market-research firm IDC estimates will power 39.5 percent of smartphones shipped worldwide this year, compared with 15.7 percent for Apple.
“We see a huge opportunity,” said David Chao, general partner at Menlo Park, California-based DCM. “We want to invest in great startups, not just in the application space, but also chipsets, smart homes, smart cars and the digital living room. It’s the whole Android ecosystem.”
DCM, which also has offices in Beijing and Tokyo, is using some capital from its existing funds, with the majority coming from its corporate partners in Asia. Gree runs a social- networking site, KDDI is a mobile-phone operator in Japan, and Tencent is China’s biggest provider of online games and instant- messaging services.
Android in Asia
Android is growing in Asia, where manufacturers such as Samsung Electronics Co. and HTC Corp. are using the operating system in phones and tablets. DCM said it plans to add additional partners to the A-Fund in coming weeks, including a U.S. semiconductor company.
The A-Fund will make investments of $250,000 to $5 million, Chao said. DCM is about to close three or four deals with entrepreneurs who it contacted before announcing the fund.
“Because we knew this was going to launch, we’ve been very proactive at reaching out to some of the best Android companies,” Chao said.
DCM has invested in more than 140 companies since 1996 and currently manages $2 billion, according to its website. Its Asian investments include Renren Inc. the Chinese social- networking service that filed for an initial public offering last week; E-Commerce China Dangdang Inc. (DANG), China’s largest book retailer; and Japanese online-brokerage company Kabu.com Securities Co.
To contact the reporter on this story: Ari Levy in San Francisco at alevy5@bloomberg.net.
To contact the editor responsible for this story: Tom Giles at tgiles5@bloomberg.net.
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