China-based early-stage investor ZhenFund will close its eighth fund on approximately USD 300m after about four months in the market, according to three sources familiar with the situation.

The vehicle was oversubscribed despite a challenging fundraising environment for China venture capital, two of the sources said, adding that a final close was imminent.

ZhenFund, which positions itself as the first institutional investor in Chinese-founded start-ups domestically and overseas, closed Fund VII on USD 400m, the first source said. This is consistent with the target amount disclosed in a US Securities and Exchange Commission filing from 2022.

The first and second sources added that Fund VIII was deliberately capped at USD 300m, in part because ZhenFund plans to build a more concentrated portfolio than in prior vintages.

ZhenFund has been a prolific investor in artificial intelligence (AI) start-ups in recent years, notably participating in a seed round for Manus AI in 2023 at a post-deal valuation of USD 140m. It re-upped in the angel, Series A, and Series B rounds, which also featured the likes of HSG and Benchmark.

Manus launched its eponymous global general AI agent in March 2025, closed a USD 75m Series B at a USD 500m valuation one month later, and then relocated its headquarters from China to Singapore. A USD 2bn trade sale to Meta, announced in late 2025, prompted regulatory reviews in China, according to AVCJ Research.

In addition, ZhenFund has exposure to AI workspace specialist GenSpark AI, large language model (LLM) specialist Moonshot AI, and AI chipmaker MetaX. All three have gone on to secure sizeable follow-on rounds, while MetaX – a portfolio company since 2021 – recently listed in Shanghai.

The venture capital firm, which was established in 2011 by Bob Xu, Victor Wang, and Anna Fang, has also backed the likes of e-commerce platforms Xiaohongshu and Mecai, cosmetics business Perfect Diary, and autonomous driving technology providers Momenta and Horizon Robotics.

Investor appetite for US dollar-denominated China VC funds remains relatively weak. Less than USD 6bn was raised across 2023, 2024, and 2025 with barely a dozen managers achieving partial or final closes, according to AVCJ Research. This compares to USD 17.2bn for 22 funds in 2022 alone.

However, more GPs are returning to market on the back of renewed IPO activity, reduced competition for deals, and recognition of China’s technology edge. Most are targeting smaller funds than in prior vintages and fundraising processes are protracted.

Monolith Management is an exception. The firm closed Fund II late last year with commitments of USD 289m, up from USD 264m in Fund I, having spent three months in the market.

ZhenFund did not respond to a request for comment.