Baidu sets up 20 billion yuan investment fund

Chinese leading search engine Baidu Inc. has set up a 20 billion yuan ($3 billion) investment fund to focus on mid and late-stage technology deals in amounts of $50 million to $100 million.

Called Baidu Capital, the fund will have two to three managing partners, with money coming from insurance funds, securities firms and some government-backed investment institutions, according to a company press release.

Seeking a way to remain relevant in the smartphone era and future-proofing the company, this is company’s second effort to hold on to users by finding new technologies.

Last month Baidu announced Baidu Venture, with $200 million of capital. That fund is headed by Baidu’s Chief Executive Robin Li Yanhong himself and is aimed towards funding startups in up and coming genres, such as augmented and virtual reality.

Importantly, these new ventures puts Baidu once again in the league of its fellow Chinese firms like Tencent, Xiaomi, and Alibaba with the funds of their own used for investing in startups.

Notably, in its latest earnings, the company reported a 34 percent profit decline, steepest-ever to 2.41 billion yuan in the second quarter. Hit by a healthcare scandal, this was the slowest growth in revenue in nearly eight years.

Baidu expects its third-quarter revenue to range from a 1.9% fall to a 1.1% gain from the previous year.