Xiaomi floats own VC firm with registered capital of $29 Mn

After manufacturing and distributing mobile phones and consumer electronics, Beijing-based Xiaomi has set up its own venture capital (VC) firm with registered capital of 200 million yuan ($29 million).

The investment firm named Chongqing Xiaomi Venture Capital, which will focus on VC investing and consulting, will be completely controlled by the Chinese manufacturer, as per 36Kr report.

This was expected as the nine-year-old firm has announced aggressive investment plans, to invest in over 100 startups, for the next five years in March. Till date, it has invested in over 270 firms worth 29 billion yuan.

It's worth noting that Xiaomi's founder Lei Jun had founded Shunwei Capital in 2011 to make investments in startups. Besides China, it has been actively investing in early to growth stage Indian startups. Currently, it manages $3 billion in investments. Last year, it closed about $1.21 billion worth sixth fund.

Chinese behemoth apart from manufacturing mobile phones and consumer electronics develops mobile applications. It has a series of products including smartphones, messaging app, 3D TV, operating system and external battery.

In the first quarter of financial results, Xiaomi reportedly witnessed over 27% yearly growth in revenue. The company's international growth was even more, about 35% growth YoY.

With a leadership position, India is one of its key markets outside China since past five years.

According to IDC latest report, Xiaomi captured 28.9% share in the India smartphone market. Xiaomi India Managing Director Manu Kumar Jain had also claimed that the Chinese smartphone maker is 54% bigger than the second brand.

This just appears to be a beginning as Xiaomi wants to manufacture everything in India.

It is also planning to launch a slew of products including electric vehicles, water purifiers, refrigerators, and washing machines. Xaiomi already has invested in several startups including Sharechat, Hungama, Krazybee, and ZestMoney. The Chinese firm is also piloting payments services in India.

In the last five years, the smartphone maker has consolidated its presence in India. At present, it boasts over 80 million users in the country. It accounts for more than 55% of online smartphone sales. It throws up a new product almost every month with almost seven manufacturing locations.

In March, Xiaomi announced an investment of Rs 3,500 crore into its Indian entity in an effort to bid to strengthen its stranglehold in the Indian market.

Last month, Jun had said that India will be majorly benefitted, in terms of investment, due to the recent trade war between China and the US.