One of Chen's first investments in 2004 was in New Oriental Education & Technology Group, a provider of test preparation and foreign language courses that was looking to expand. Chen's college English professor helped start the company and she saw the prospects for private education in China. “My whole generation was basically mentored by New Oriental,” she said. New Oriental went public in 2006 and the shares quadrupled in a year. She had made her first fortune at Tiger.
“Xiaohong is a terrific investor,” said Coleman in an e-mail. “Her capacity to navigate the Chinese investment landscape and its many nuances is second to none.”
She also invested in JD.com when it was an upstart in the shadow of Alibaba Group Holding Ltd. Sensing the company’s margins could grow sharply if they reached a large enough scale, she agreed to a valuation that surprised the tech community. “Everyone thought we were crazy, everyone thought they would die,” she said. “When we looked at it we saw only potential. E-commerce is a pure economies of scale game.”
Through it all, she raised three children. Her work habits would have been unusual, if not unacceptable, in the West. She brought her first-born son to the office every day for three years. She didn't have a nanny or a helper so he came to virtually every meeting she had, crawling on conference tables and scribbling on walls. She says that bringing her children helped build a bond with many of the entrepreneurs she backed. Her son did cry and disrupt meetings, but that didn't stop her. It gave her a chance to develop a more personal relationship with founders.
She thinks being a woman gave her another advantage: It was easier for her to tell an entrepreneur he was wrong than a male investor. “It’s very politically incorrect to say this, but as a woman I can say things, they do show a special respect for women. Because it’s seen as motherly, you can be much more stern.”
“There were many role models, which was helpful when I started a family”
Chen has set an example that’s made an impact on younger generations. “For me, there were many role models, which was helpful when I started a family and was worried about how to manage being a mom and running a fund,” said Fang of ZhenFund. Fang points to Chen as one of the models that convinced her she could balance the rigorous demands of her job with the role of being a mother.
Now, as these women rise through the ranks of venture capital and private equity, they are working to make sure more can follow in their footsteps. Fang's nine-member investment team has four women and they’ve put money into more than 30 startups founded or co-founded by women. She is part of a group of more than 150 young female venture capitalists on a WeChat social messaging group. She’s also the only woman on a five-person panel judging startups on “I’m a Unicorn,” China’s version of the television show “Shark Tank.”
Sally Shan, former head of Asia Pacific technology investment banking at JPMorgan & Chase Co., is now managing director of the $37 billion HarbourVest Partners and runs a college mentoring program to encourage female entrepreneurs. Lu, who's known Shan from her banker days, is a frequent lecturer there. “We’re building a community,” said Lu. “From the upstream limited partners, endowment world, family offices, to the general partners, there’s a lot of females in China that are extremely competent.”
Sexism still seeps into the industry. Chinese technology companies have made a habit of inviting Japanese porn stars to corporate events. One local Internet company hired cheerleaders to provide programmers with extra motivation. Men also lead the biggest venture firms and hold the vast majority of partnership posts, even if it is less than in the U.S. “It’s dangerous to say the field is completely even, because especially in tech, at least at the operational level, there is a huge gender issue,” said Rui Ma, partner for 500 Startups, a Silicon Valley-based fund. She often finds herself the only women at industry panels. “I also have had friends who are female and who are single who are aspiring founders who have been rejected for funding on the basis of their gender, and been told so point blank.”