David Su (Xu Chuansheng) is a highly respected venture capitalist and a founding partner of Matrix Partners China. Since co-founding the firm in 2008, he has been a pivotal figure in China's tech investment landscape, known for his early and insightful bets on some of the country's most iconic companies, including Didi Chuxing, Ele.me, and Heptagon.

His background as an engineer and an entrepreneur before becoming an investor gives him a unique and empathetic perspective. His learnings offer a masterclass in navigating the hyper-competitive Chinese market, identifying exceptional founders, and building enduring companies.

On Investment Philosophy & Strategy

  1. "Be the first institutional money in." Su and Matrix Partners China have built their reputation on being the earliest institutional investor in a company, often at the Angel or Series A round. (Source: The Harbus)
  2. "We are not momentum investors; we are conviction investors." The goal is not to follow the herd into hot deals but to develop a strong, independent thesis and invest with conviction before a sector becomes popular. (Source: Common theme in his investment approach)
  3. "Our core principle is 'founder-centric'." The firm's entire model is built around serving and supporting the entrepreneur. Their success is Matrix's success.
  4. "We look for 'long-slope, thick-snow' opportunities." This analogy, borrowed from Warren Buffett, describes investing in massive markets with long-term growth potential where companies can compound value over time. (Source: Matrix Partners China Official Website)
  5. "A VC's job is to see the unseen." The greatest value is created by identifying a company's potential when it is not obvious to others.
  6. "We are disciplined about ownership." As an early-stage investor, securing a meaningful stake (typically targeting 20%) is crucial for the fund's economics and to have a significant voice at the table. (Source: The Harbus)
  7. "It’s more important to be right than to be popular." Many of his best investments, like Didi, were in highly competitive or unproven sectors that other VCs initially avoided.
  8. "We do not have a CIO (Chief Investment Officer); every partner has a veto." This structure ensures that every deal has broad support and has been rigorously debated, leading to higher-quality decisions. (Source: The Harbus)
  9. "The three most important things for a startup are the team, the business direction, and the financing." A VC's primary role is to help with the latter two.
  10. "We would rather miss a good deal than invest in a bad one." Discipline is paramount. The fear of missing out (FOMO) can lead to costly mistakes.

Advice for Entrepreneurs

  1. "The founder's ability to learn and grow is the most important quality." Su refers to this as having a steep "learning curve," believing that a founder's capacity to evolve is more critical than their starting knowledge.
  2. "We look for founders who are 'all-in'." The entrepreneur must have an unwavering commitment and be willing to dedicate their life to the business. (Source: Common theme in his interviews)
  3. "A founder must be a closer." They need to be exceptional at recruiting talent, securing customers, and raising capital.
  4. "Don't be a 'me-too' company. You must have a unique value proposition." In the crowded Chinese market, differentiation is essential for survival.
  5. "Think big, but start with a focused 'beachhead market'." Gain traction and dominate a specific niche before expanding your vision.
  6. "The CEO is the ultimate product manager." The founder must be deeply involved in the product and have an intuitive understanding of the user.
  7. "Raise money before you desperately need it." Fundraising always takes longer than you expect, and you get better terms when you are not in a position of weakness.
  8. "Choose your investors carefully. It's a marriage for 10 years." Look for investors who share your vision and can provide real value beyond capital.
  9. "The 'window of opportunity' in China is very short." Due to intense competition, a startup must execute with incredible speed to capture a market.
  10. "A founder's EQ is just as important as their IQ." The ability to inspire a team, build relationships, and navigate conflict is critical for scaling a company.
  1. "In China, the business model can be more innovative than the technology itself." Many of China's biggest successes came from applying existing technology to new, large-scale business models.
  2. "The competition in China is on a completely different level. We call it the 'Colosseum'." Only the most resilient and adaptable founders can survive.
  3. "The distinction between To B and To C is blurring." The rise of social media and mobile internet means that even enterprise companies need to think about user experience and community. (Source: Matrix Partners China WeChat Official Account)
  4. "The mobile internet has been the single greatest driver of innovation in China over the last decade." It has fundamentally reshaped every industry.
  5. "Enterprise software is finally taking off in China." Historically a tough market, the rising costs of labor and the need for efficiency are creating huge opportunities for SaaS companies. (Source: Matrix Partners China Official Website)
  6. "The biggest opportunities are in the digital transformation of traditional industries." Sectors like logistics, healthcare, and finance are still in the early innings of technological disruption.
  7. "In China, you can't just be an online company. You must have a strategy for offline as well." The concept of O2O (Online-to-Offline) is crucial for reaching the mass market. (His investment in Ele.me is a prime example).
  8. "The definition of a 'local market' in China is the size of a large European country." The scale of the domestic market is a huge advantage for Chinese startups.
  9. "Chinese founders are incredibly resilient and pragmatic." They are masters of adapting their business models to survive and thrive in a tough environment.
  10. "The 'copy to China' model is long dead. Now, it's about 'innovating for China'." Chinese companies are creating unique products and services tailored to the specific needs of the local market.

Career Learnings & Principles

  1. His background as a founder helps him empathize with entrepreneurs. Having experienced the struggle of building a company from scratch makes him a better, more supportive investor. (Source: His official biography)
  2. "Venture capital is a business of delayed gratification." It often takes 7-10 years to know if an investment was truly successful. Patience is essential.
  3. "You have to be comfortable with being wrong a lot of the time." The VC business model is built on a few big winners offsetting many small losses.
  4. "Stay curious and keep learning. The world of technology changes every day." A good investor must have a passion for learning.
  5. "The power of the partnership is our biggest strength." At Matrix China, the collaborative culture and the collective wisdom of the partners lead to better decision-making. (Source: The Harbus)
  6. His investment in Didi was a lesson in backing a visionary founder in a brutal, winner-take-all market. He saw Cheng Wei's potential early on.
  7. "A VC's reputation is built on how they act when things are going badly." Being a supportive and helpful partner during tough times is what defines a great investor.
  8. "You have to have a prepared mind." Success often comes from years of research in a specific sector, so when the right team comes along, you are ready to act decisively.
  9. "Don't let your past successes make you complacent." Each new investment must be evaluated on its own merits.
  10. "The best source of deals is referrals from trusted founders." Building a strong network and a good reputation within the entrepreneurial community is paramount.
  11. He holds an MBA from Stanford Graduate School of Business. This experience was instrumental in his transition from an operator to an investor. (Source: His official biography)
  12. "It's important to have a work-life balance to stay sharp in the long run." The intensity of the VC job requires periods of rest and reflection.
  13. His investment in Ele.me was a bet on the massive market for food delivery and the tenacity of its founder, Mark Zhang.
  14. "A good board member knows when to listen and when to speak." The role is to be a strategic sounding board for the CEO, not to micromanage.
  15. "The ability to build trust is the foundation of every successful relationship, whether it's with founders or LPs."
  16. "Don't chase headlines. The best companies are often built quietly for years before they become famous."
  17. He focuses heavily on providing post-investment support. Matrix China has built a large, dedicated team to help its portfolio companies with recruiting, PR, and fundraising. (Source: Matrix Partners China Official Website)
  18. "Venture capital is an apprenticeship business." You learn the most by working with and observing experienced investors.
  19. "Be intellectually honest with yourself. Acknowledge your mistakes and learn from them."
  20. "The ultimate reward is seeing a company you backed from a small idea grow to have a massive, positive impact on society."