Chinese electric-vehicle startup Guangzhou Xiaopeng Motors Technology Co. Ltd. said Wednesday it secured $400 million in its latest fundraising round, with smartphone-maker Xiaomi Corp. stepping in as a strategic investor.
This Series C round brings the total funds raised by the carmaker to 12 billion yuan ($1.7 billion), according to Caixin calculations. Its founder and chairman, He Xiaopeng, boosted his stake in the company, according to an emailed statement from Xpeng.
Venture capital firm MatrixPartners China Management Ltd. said in a separate statement (link in Chinese) that it also invested again in the company.
Xpeng also secured several billion in yuan-denominated unsecured credit lines from China Merchants Bank, China Citic Bank, HSBC, and other banks, its statement said.
Xpeng did not disclose its new market valuation. The previous round in August 2018 put it at around 25 billion yuan.
The statement also said that the company plans to launch its second electric car, the P7 sedan, next spring.
Xiaomi, which makes a range of consumer electronics in addition to its core smartphone business, will look to work on connecting “smartphones and smart cars” through its investment in Xpeng, as part of its Internet of Things strategy, Chairman Lei Jun said in a statement (link in Chinese).
Lei has previously invested on a personal basis in a Chinese rival to Xpeng, Nio Inc., which has seen its New York-listed stock plunge by over 60% since its IPO a year ago.
Xpeng’s latest fundraising haul may have fallen below its expectations. Xpeng President Brian Gu told U.S. media outlet CNBC in June that the company would look to raise a similar amount in this round as it did in its previous round, but it came in about 30% short.
Funding has recently become much harder to come by for startups, but Lai Xiaoling, partner at Shunwei Capital, told the Caixin Summit last weekend that this is a good thing after investors’ somewhat irrational pursuit of tech businesses in recent years.
China, the world’s largest electric vehicle market, was once flooded with venture capital looking for the industry’s next big thing. But as Beijing slashes subsidies, investors are now pulling back.
Contact reporter Isabelle Li (liyi@caixin.com)
