Neil Shen’s HongShan Is Slow to Deploy Its $9 Billion Capital, Looks for Deals Outside China

When venture capital giant Sequoia decided to carve off Sequoia China two years ago in response to growing tensions between the U.S. and China, the newly independent China firm was expected to continue pouring its huge funds into Chinese startups.

Renamed HongShan (Mandarin for Sequoia), the firm had only a year earlier raised what was then a record $8.8 billion to fund new tech investments. Three years later, things haven’t turned out as expected. HongShan has invested only a quarter of its giant war chest, according to two people with direct knowledge of the matter. The unusually slow pace underscores the reality that the yearslong challenges confronting Chinese VC firms—including a moribund Chinese economy and U.S.-China trade tensions—have not eased, as even the best of them struggle to find enough good deals to invest in.