Shanghai, CHINA – Jim Breyer may be pushing 60, but you wouldn’t tell from his boyish good looks. The famed venture capitalist dresses like a cross between Mr. Rogers and your favorite science teacher. Soft spoken and unassuming, Breyer is not someone you’d readily pick out in a crowd, yet he has had no trouble picking winners, having made his fortune largely investing in the Silicon Valley and in particular in one young Harvard dropout who would go on to build Facebook into the global phenomenon that it is today. It is Breyer’s prescience which has built his fortune so when he looked increasingly to invest in the East, in particular in China, it was important to take note. According to Breyer,
“Many of the best technology entrepreneurs and leaders I met are from China.”
Considering that Breyer has also met Silicon Valley’s best and brightest, the compliment is a big one. Breyer has also put his money behind some of the biggest names in China, backing ride-sharing firm Didi Chuxing and smartphone behemoth Xiaomi, Breyer’s streak of picking winners shows no signs of abating. But Breyer is not just looking East, he’s also looking to the blockchain, examining and allocating tens of millions of dollars in blockchain, healthcare and financial services startups.
Although China banned Initial Coin Offerings (ICOs) last year, for fear of “illegal” fundraising activities and presumably to also stem possible capital flight, it still “greatly supports” blockchain related research and has allowed certain ICOs such as NEO, backed by Alibaba’s Jack Ma, a known Chinese Communist Party advocate, to thrive. Beijing’s backing of the blockchain allows Breyer to co-invest with IDG China in U.S. blockchain companies such as Circle, a Bitcoin blockchain-based remittance company, which successfully raised US$60 million in 2016.
But the blockchain is not just confined to use in money transfers, it also enables better medical data collection and recording as well as treatment and diagnostics. In February, Breyer invested US$25 million through his company Breyer Capital in Paige.ai, a blockchain and artificial intelligence company which develops computer models for early cancer diagnosis. China would be particularly suited for such a product, given that patent records there are highly fragmented and scattered across its one million healthcare facilities. Compounding the problem is poor sharing of patient data and diagnostic information. According to Breyer,
“A lot of underlying blockchain technologies in China have uses in very specific areas. Most of the early significant winners in blockchain will be in the areas of fintech. At the same time, I see opportunities in healthcare services and payments at large.”
China’s growing talent pool has also been a big draw for Breyer. Its universities are churning out top-notch talent in future technologies such as blockchain and artificial intelligence, even as some of its best and brightest students from the United States return home to contribute to the growth of the Middle Kingdom. Breyer adds,
“Many of the best technology entrepreneurs and leaders I met are from China and are only increasing in terms of quality and the depth of innovation.”
Many entrepreneurs in China, especially foreign graduates from relatively wealthy families who are under less economic pressure to find a job to support their families are able to take a longer term view when it comes to entrpreneurship, thinking more in terms of how their work can contribute to Chinese society and the world as a whole. Breyer sees himself as being part of that movement, focusing on helping Chinese companies he has backed grow locally, with the ultimate goal that these companies should be able to compete globally.
Breyer also understands the Chinese landscape intimately, having positioned himself on the advisory board at Tsinghua University’s School of Economics and Management, where he sits at the same table as China’s central bank governor Zhou Xiaochuan, Alibaba’s Jack Ma, Apple CEO Tim Cook as well as Facebook’s Mark Zuckerberg. Just last year, board members met with Chinese president Xi Jinping to hear his views on reform just before he was awarded a second five-year term during last year’s party congress in October. According to Breyer,
“I spend lots of time with Tsinghua leaders to understand their views of important initiatives.”
That Breyer is investing in cryptocurrency startups such as Circle and other blockchain companies should speak volumes as to the viability of the space both in China and the rest of the world. With a penchant for sieving the wheat from the chaff when it comes to investing in startups, Breyer’s betting on the blockchain, especially in China should speak volumes as to the viability as well as the longevity of the space. Breyer adds,
“Many Chinese and U.S. long-term relationships tend to fracture, so I am very lucky.”
Given Breyer’s track record, it would be surprising if luck had anything to do with it.