The financing story of Qunhe: Angel investors made nearly a hundred times their investment.
Today, Qunhe Technology was listed on the main board of the Hong Kong Stock Exchange. After the opening, the stock price soared to HK$21 per share, a more than 175% increase from the issue price of HK$7.62 per share. The company's total market value once exceeded HK$35.7 billion.
In the context of entrepreneurship, "holding a hammer to look for nails" means having technology in hand but not yet finding a clear application scenario, making it difficult to quantify the commercial value. This stands in sharp contrast to the era of mobile Internet. Back then, whether it was the shared mobility or platform - type projects, the network effect and business logic were relatively clear. However, in the tide of technology entrepreneurship, many technology - competitive enterprises are on the path of "holding a hammer to look for nails". For example, NVIDIA in the earlier days and the current embodied intelligence companies more recently.
"Holding a hammer to look for nails" means an unresolved situation and uncertainty, but it may also mean a broader market space that is difficult to accurately calculate for the time being. Today, we are going to tell the financing story of Qunhe Technology, one of the "Six Little Dragons in Hangzhou". As early as fifteen years ago, Qunhe Technology became a pioneer on this path. In a period when technology entrepreneurship was not the mainstream and the business model was not clear, this company was firmly bet on by a group of top - tier investors almost from the very beginning.
The first to make a move was Wang Huai, the founding partner of Linear Capital. He invested the first angel fund in his personal capacity and has not exited for fourteen years. Roughly estimated, this investment has brought nearly a hundred - fold return.
Mao Chengyu made the first investment during his tenure at IDG in 2013. Later, he founded Yunqi Capital and continued to increase his investment immediately. So far, he has accompanied the company for thirteen years. Niu Kuiguang of IDG promoted the institution to continuously increase its investment after 2017, and continued to follow - up invest in a disproportionate amount. Eventually, IDG grew into one of the largest shareholders.
Another institution with a similar shareholding ratio of nearly 13% is GGV Capital. Since its entry in 2014, it has increased its investment for seven consecutive rounds, and almost strictly followed up in proportion (pro - rata) in each round. Also entering the market in the same year was Matrix Partners. It participated in the Series B financing and clearly felt that the market's judgment of Qunhe was almost a "conditioned - reflex underestimation".
Another core investor, Hillhouse Capital, has long held about 10% of Qunhe Technology's shares. In 2019 when the primary market shrank and in 2020 under the impact of the pandemic, Hillhouse led the investment in two consecutive rounds, continuing to put more chips on the table.
With the relay of top - tier institutions, these seemingly scattered decisions have ultimately resulted in a rather rare outcome: at a stage when the business model was not fully clear, Qunhe Technology was continuously and firmly invested in. It wasn't until the rise of the AI wave that the company became one of the "Six Little Dragons in Hangzhou" and gained great fame.
Qunhe Technology's IPO journey has been nearly fifteen years. It has experienced the difficulties of early - stage financing and finding a landing direction for its technology, survived the industry adjustment period and found its second growth curve, and also endured the difficult stage after the change of the listing plan. It is a rare case with the meaning of "long - termism" in the venture capital circle in recent years. "Entrepreneurship is a game for the brave. If you choose a difficult path, don't care too much about what others think of you. It doesn't matter if you are misunderstood or underestimated. As long as you keep moving forward, time will be on your side." At the spring graduation ceremony for postgraduate students of Zhejiang University in 2026, Huang Xiaohuang, the chairman of Qunhe Technology, gave such a message to his alumni.
For investors, it is difficult to "understand the whole story" at a certain point in time. They can only continuously judge whether the capabilities accumulated by the enterprise have the potential to be reused across stages. As an investor said, Qunhe's growth does not convince the market with a single result but leads investors to the future step by step through a continuous evolution process.
"Classmate Entrepreneurship"
When recalling their first impression of Qunhe Technology's founding team, most investors described them as "down - to - earth", "pure", and "reassuring".
The three founders are alumni. Among them, Chairman Huang Xiaohuang and CEO Chen Hang are not only alumni of the 2003 mixed class of Zhkezhen College at Zhejiang University but also became roommates in their senior year. CTO Zhu Hao became an alumnus of Huang Xiaohuang at the University of Illinois at Urbana - Champaign when Huang was studying for a master's degree in the United States. In 2011, the three founded Qunhe Technology in Hangzhou. In the early days of entrepreneurship, the team size was limited, and it was almost supported by interns from Zhejiang University. Under the relatively limited conditions of funds and resources, they carried out technological exploration around the cloud - based GPU cluster.
The mobile Internet was booming, and most business plans were about O2O and P2P. GPU rendering was still a niche technology. Huang Xiaohuang once did CUDA development at NVIDIA, but this hardware company background was not popular at that time. In the first two years of entrepreneurship, Huang met a number of investors intensively, but none of them was willing to invest.
Wang Huai saw something different. As an early Chinese engineer and the first Chinese R & D manager at Facebook, he understood technology and the personalities of technologists. Huang Xiaohuang impressed him as "a very straightforward person among technical workers". Later, in the process of Qunhe's development, Huang also showed rare empathy and emotional management ability. Even in the most difficult moments, when Huang called him, and Wang was almost indignant for him after chatting, Huang would say, "Well, I can understand."
Finally, Wang Huai, Huang Xiaohuang's alumnus from Zhejiang University, invested in his personal capacity and became the angel investor of Qunhe Technology. The investment amount was not large. At that time, Linear Capital had not been established yet. Wang usually invested 1 - 2 million for angel investments, but he had lost money in many early - stage projects, so he "cut the budget in half" for Qunhe.
At that time, Mao Chengyu, who was still a partner at IDG, was at a turning point in his personal career, but he made a crucial investment in Qunhe Technology - IDG became the first institutional investor of Qunhe.
What attracted Mao Chengyu were three young men with strong technical backgrounds and their almost obsessive insistence on GPU rendering. "When you listened to them, you would feel a little excited," Mao recalled. However, this "excitement" did not come from business certainty but from the imagination space that technology might bring. In his perception at that time, GPUs were mostly used in Hollywood special - effect production. But once this ability was transferred to a wider range of industries, "it would be a dimensionality - reduction strike in terms of efficiency and effect".
In 2014, Mao Chengyu left IDG and founded Yunqi Capital, and immediately continued to increase his support for Qunhe. In 2017, Niu Kuiguang actively promoted the institution to continue leading the investment. However, since IDG already had a high shareholding, at Huang Xiaohuang's suggestion, IDG still agreed to continue supporting and made a large - scale follow - up investment.
In Niu Kuiguang's view, Qunhe is a good example of classmate entrepreneurship. The advantage of classmate entrepreneurship is good understanding and a strong foundation of trust, while the potential problem is that there may be blurred areas in division of labor and decision - making. The way of Qunhe's three - person team is as follows: Huang Xiaohuang serves as the chairman, Chen Hang serves as the CEO, and Zhu Hao serves as the CTO. Once there is a disagreement, Huang Xiaohuang's decision is the final one by default.
"Holding a Hammer to Look for Nails"
With the technology in hand, where is the business scenario? Huang Xiaohuang later attributed this problem to "holding a hammer to look for nails".
As one of the "Six Little Dragons in Hangzhou", in our previous article "The Financing Story of Unitree", we described Unitree as a group of grass - roots entrepreneurs who "broke the arrogance of the elite" and chose to start a business in cutting - edge technology. From this perspective, Qunhe's story seems more like a top - notch technical team finding a very practical landing direction - home decoration design.
In 2013, Qunhe Technology launched Kujiale, a space - design software. Designers or other users can quickly start home decoration design by dragging and dropping pre - set 3D models and quickly obtain the rendered results. The underlying technology of Kujiale still relies on the rendering ability of GPUs. However, with the product, a technology that was originally in the air began to be embedded in the production process of a specific industry.
In those years, the home decoration track was extremely hot. Players like Tuba were frantically attracting traffic on the To C side, trying to restructure the industry. However, Qunhe deliberately avoided this path and chose to focus on the To B market, targeting designers and home decoration companies. "It's the same product, just with a different entry point." Mao Chengyu, who was still at IDG at that time, provided crucial advice on Qunhe Technology's commercialization direction. Instead of competing for the user entrance or participating in price wars, Qunhe should embed itself in the design process and use technology to improve efficiency.
Wang Huai believes that finding the "nail" of home decoration was the most crucial step in Qunhe's business. "Xiaohuang made a great decision to cut off other directions and focus on home decoration." By concentrating all the "hammers" on one "nail" from multiple possible application scenarios, Qunhe has "thoroughly explored" home decoration rendering and design.
In 2014, during Qunhe's Series B financing, Fu Jixun, the managing partner of GGV Capital, met Chen Hang in Shanghai. The initial product introduction and function demonstration were completed in GGV's office. Then he went to Hangzhou to visit the other two founders, to deeply understand the team's background and work experience, and to discuss the possibility of product commercialization.
Fu Jixun's impression was that the company's commercialization path was still rather vague, and it was typically in the stage of "holding a hammer to look for nails". He recognized that the direction of applying GPU rendering technology to the home decoration and furniture industry was obvious. However, there were still great uncertainties about the final form of the product, the specific commercialization and monetization model, and whether end - users and enterprise customers were really willing to pay. Fortunately, the three founders were a very simple and down - to - earth technical team, which was also an important reason for GGV to finally proceed with the investment.
Matrix Partners also entered the market in the Series B round in 2014. At that time, a clear feeling was that the market's judgment of Qunhe was almost a "conditioned - reflex underestimation". The reason was simple. At that time, Qunhe was classified as a "3D design tool" and naturally carried several unpopular labels - non - platform, weak network effect, limited To B payment ability, and a clear ceiling. Under the valuation framework for "tools", Qunhe seemed neither attractive nor scarce, and was even simply classified as a variable subordinate to the real - estate cycle.
Moreover, the home decoration industry is a mixed bag. It's difficult for entrepreneurs without a certain sense of the "business arena" to make a name for themselves in it.
However, Qunhe's team with a technical background has achieved it.
In Wang Huai's view, the company's foundation is very solid. This is because the home decoration industry they have been deeply involved in has always been a place with a lot of work but little profit. "The home decoration rendering and design market in China is only worth four to five billion. Qunhe now has nearly one billion in revenue and has taken the leading position. Most of the market is occupied by offline service providers with personal connections, and they have their own cooperation partners. It's not easy to really break into this market." Simply put, many people haven't entered this territory because it's difficult to make quick money.
Fu Jixun has the same view. Even since 2016 when the housing economic policy tightened, Qunhe has still been on an upward growth trend and can resist the competition from large companies. Qunhe later also began to explore internationalization and has made layouts in the US, Japan, Southeast Asia and other markets. Currently, the proportion of its international business has reached 10% - 20%, and this business line has been initially successful.
"Everything is Arranged by the Times"
Of course, "finding the nail" doesn't mean everything will go smoothly. The reality of To B business is that it's difficult to collect fees, growth is slow, and it's not easy to tell an attractive story. For a long time, Qunhe has been in a position where it "doesn't seem large enough". Mao Chengyu also admitted that it is very challenging for a To B product to achieve rapid breakthroughs in revenue.
Meanwhile, the company has also been constantly making trial - and - error attempts internally. In 2016, Mao Chengyu invited Huang Xiaohuang's team to the United States. At that time, the Houzz model was very popular in the US home - design industry. Qunhe briefly tried to extend its product to a traffic entrance or an e - commerce tool, but these directions were quickly proven to be unsuitable for itself.
In the process of exploring the next step, one of the possibilities Qunhe found was to go global, such as product display in cross - border e - commerce. IDG had an early layout in cross - border e - commerce and had invested in Anker, Insta360, SheIn, etc. It had rich know - how in this direction. Niu Kuiguang and Fu Jixun spent a lot of time promoting the company's globalization and advocated for greater investment in going global. Niu Kuiguang also invited Ge Ke, the former general manager of Kingsoft Office with rich overseas experience, to participate in the market research and the establishment of the overseas market.
In addition, Niu Kuiguang also noticed that Qunhe, which had been "naturally growing", had reached a stage where it needed more strategic thinking, rather than just spending time on the product and technology levels. In this invisible aspect, Niu also invested a lot of energy in guiding the three young men on how to build an organization, formulate strategies, and standardize the board - meeting process step by step.
Through continuous exploration, Qunhe's three paths have gradually become clear: expanding B - side home - furnishing customers and breaking the boundary of only serving designers; second, laying out the overseas market; third, product upgrading, with the core direction being spatial intelligence - this is Qunhe's keen technological sense and a key move to open up a larger space.
After the home - furnishing business became successful, Qunhe was quite popular in the capital market. In 2018, Shunwei Capital led Qunhe's Series D financing. It is said that Lei Jun really liked this team with a technical background and even offered to increase the price by 20%. In the subsequent Series D + round, Hillhouse also joined.
In 2020, Qunhe's commercialization exploration had become very diverse. Its users had expanded from the most core designers to the enterprise side, and it had also launched various tools. At that time, global funds were relatively abundant, and the pandemic further boosted the popularity of online software. However, there were only a few SaaS companies in China that could reach a scale of nearly 100 million US dollars. An investor recalled that Qunhe Technology's financing at that stage was severely over - subscribed, and even a globally well - known fund failed to get a share.
The good days suddenly stopped. In 2021, Qunhe originally planned to be listed on the NASDAQ. However, on the eve of the listing, the market trend suddenly changed. For well - known reasons, Qunhe's listing plan was put on hold. The setback in the listing was obviously a low point for this company on an upward trend, but many people have different views when looking back on this scene after many years. Mao Chengyu recalled, "After being hit by the black - swan event, people will be in a low mood for a while, but then it will pass."
An investor told me that if Qunhe had been listed in 2021, it might not have been a good thing. "The stock price might have dropped by 90%", and it would not have had the chance to become one of the "Six Little Dragons in Hangzhou" later. He sighed that everything is arranged by the times.
The "Water Seller" in Spatial Intelligence
In 2023, Qunhe began to lay out in the field of spatial intelligence, even earlier than Fei - Fei Li.
Spending a large amount of money on infrastructure construction and R & D without making a profit was enough to discourage some investors. In fact, some investors strongly opposed Qunhe's transformation and hoped that they would cut R & D and increase profits.
But Huang Xiaohuang was very determined. In a media interview, he said that spatial intelligence will