From consumption to technology: Tiantu Investment's unrealized gains on the books and shift in investment focus

Guan Dian Viewpoint “Consumer investment expert” Tiantu Investment delivered an eye-catching set of results for 2025.

According to data, during the period, the company achieved revenue of 17.8M yuan, investment gains of 232M yuan, and net profit attributable to shareholders of 196M yuan.

And in 2023 and 2024, this PE firm had already been loss-making for two consecutive years. Now it has swung back to profitability, with a distinctly “turn-the-tide against the odds” flavor.

However, this time the performance returned to the red mainly benefited from valuation recovery on the investment side and the cash-back effect brought by the pace of exits, rather than an increase in management fees. In other words, this is Tiantu Investment earning its results through genuine investment prowess—fighting it out, deal by deal.

However, after all, valuation recovery is only paper wealth. Tiantu Investment’s long-term IRR, the pace of exits, and the “quality” of assets under management—these are the three trump cards the market cares about.

Paper Wealth

Judging from the data, in 2025, Tiantu Investment truly pulled off a beautiful turnaround.

During the period, the company recorded net profit attributable to shareholders of 196M yuan, while in the same period last year it was mired in a loss of 891M yuan. The contrast between the positive and the negative is especially stark.

Breaking down the profit structure, it was found that when the company’s profits turned around from loss to profit, its management fee income still plunged year over year by 58.02%, leaving only 17.8M yuan. Tiantu Investment explained in its financial report that this was mainly because some funds had entered the extension period and no longer collected management fees.

And the real protagonist behind this “turnaround” was investment gains brought by changes in fair value.

According to data, Tiantu Investment incurred a loss of 232M yuan in 2024, while in 2025 that figure dramatically turned around “from V-shaped reversal” to generate a profit of 2.32 billion yuan.

In fact, this is the “normal script” of the PE industry. After all, Tiantu Investment does not rely on management fees to survive; the lifeline of enterprises lies in project exits and valuation fluctuations. Therefore, having net profit ride the roller coaster together with investment gains is the underlying tone of this business model.

2020 is the best example. In that year, the pandemic boosted live-streaming e-commerce and online education; the consumer sector’s fire burned fiercely. Tiantu’s investment gains surged to a historical peak of 39M yuan. Even though management fees that year were only 0.39 billion yuan, it still easily delivered net profit of 721M yuan.

Then in 2023, market expectations and reality diverged sharply during the recovery. The valuation framework for the consumer sector underwent a major restructuring. That year, Tiantu’s investment gains shifted from positive to negative, resulting in a disastrous loss of 45M yuan. Management fees barely held at 0.45 billion yuan, and ultimately net losses reached 873M yuan.

In 2025, as sentiment in the capital market toward the consumer sector moved from overly pessimistic in the prior two years to a more moderate recovery, valuation rebound in the sector turned investment gains back to positive, thereby driving Tiantu Investment’s performance back into the green.

However, even so, the market still believes that management fees are the PE firm’s “core base” and “cash-flow safety cushion,” and are key to ensuring the institution’s long-term operations.

And Tiantu’s management fee income in 2025 dropped significantly, while employee costs during the same period reached 0.61 billion yuan. Just this item alone was not enough to cover daily operating expenses such as compensation, creating a clear gap between income and expenses.

Put differently, Tiantu’s day-to-day operations, in essence, “keep the company alive” through project-exit receivables and performance-based compensation. This income-expense structure means the company is essentially exposed to market-cycle risks.

Once the market turns downward and valuations shrink, management fees alone cannot prop up the bottom line. Large losses and a cash-flow crisis will follow one after another.

Tight Cash

For Tiantu Investment, the valuation rebound brought by sentiment recovery is ultimately only “paper wealth.” The actual inflows and outflows of real cash shown on the cash flow statement are the more important trump cards to examine.

During the reporting period, the company’s net cash inflow from operating activities reached 61M yuan, up 21.55% year over year. Behind this are genuine cash receipts from project exits and dividends paid by investees, indicating that the exit capability of underlying assets and their “blood-generating” ability are being continuously repaired.

A key figure is that the unrealized gains of financial assets measured at fair value with changes recognized in profit or loss for the current period totaled as much as 626M yuan—this is the core reason the company turned from loss to profit in 2025.

In other words, the company’s assets rose by 1.33B yuan on its books.

Meanwhile, it received dividends of 0.68 billion yuan, up sharply from 0.29 billion yuan in the prior year. This means that investees not only survived, but also began distributing dividends, providing a steady incremental contribution to cash flow.

More worth watching is that financial assets measured at fair value with changes recognized in profit or loss decreased by 68M yuan, up 21.3%.

This money is essentially real cash received from project exits and equity transfers, and it is also the largest source of Tiantu’s operating cash flow in 2025. This suggests that its exit channels such as IPOs and M&A are running smoothly, and the ability to realize assets is improving.

Another positive signal is that last year, the company sharply compressed its losses from 29M yuan last year down to 0.77 billion yuan. That is, there were fewer projects that truly “cut loss and exited,” and exit quality improved clearly.

Although the company did not disclose its overall IRR, based on landmark exit cases, the IPO of Bama Tea Industry brought returns of more than 14 times; the sale of Younuo China’s consideration was about 77M yuan. The core assets’ ability to realize value has stood up to scrutiny.

These figures above show that both the quality of Tiantu Investment’s exited projects and the profitability of investee companies improved in parallel. At the same time, exit capability continues to recover, and its cash “blood-generating” capacity is returning.

However, beneath such performance, there are also shadows.

In 2025, the company’s net cash flow from investing activities was -1.57B yuan, which narrowed significantly by about 87.2% compared with 2024. Overall, it shows a trend of investment contraction. Meanwhile, in the same period, net cash outflow from financing activities was as high as 14M yuan, surging 190% year over year.

Looking specifically, the past year was Tiantu’s “deleveraging” year. The company repaid corporate bonds of 925M yuan, while the figure in 2024 was only 0.3 billion yuan—nearly 30 times different.

At the same time, due to some funds reaching maturity, in the consolidated structured entities, capital redemptions by third-party holders were 874M yuan, up 60% year over year. This is actually a typical characteristic of PE firms entering the exit period—realizing gains from existing funds and distributing the money to investors.

With one side being a large-scale debt repayment of 30M yuan and the other side being capital returns of 874M yuan, Tiantu Investment’s net cash outflow from financing activities in 2025 increased sharply to 466M yuan. Although it did not issue new debt to further deleverage, these expenditures have already significantly consumed the cash flow generated by operating activities.

The result is that the company’s balance of cash and cash equivalents fell from 925M yuan to 1.23B yuan, and the short-term cash safety buffer declined.

Going forward, whether operating cash flow can remain stable will become the key determinant that supports the company’s strategy and operations.

From Consumer to Technology

In an interview in the early years, Tiantu Investment’s founding partner, Feng Weidong, mentioned that in the beginning they looked at all kinds of fields and invested in all kinds of projects; they hit many walls while exploring, but eventually found that they were best at investing in consumer goods.

After paying enough “tuition,” Tiantu finally made up its mind: invest only in consumers.

Feng Weidong even made a vision commitment: “Invest in 50 consumer companies in China that have strong brand influence and long life cycles, and Tiantu will hold them for the long term.”

So starting in 2021, on Tiantu’s investment map, consumer goods cases became visibly more numerous. There were a batch of widely popular catering and consumer brands such as GuoYuan Garden, Naixue’s Tea, Bao Shi Fu, Tea Yan Yue Se, Zhong Xue Gao… Behind all of them, there is Tiantu’s presence.

The latest financial report shows that in Tiantu’s project pipeline, it still holds a heavy position in 187 high-quality companies, including Xiaohongshu, Wanwu Shengsheng, KuaiKan Manga, Tea Yan Yue Se, Bama Tea Industry, Bao Shi Fu, and others. The consumer “core base” looks, for now, relatively solid.

But Tiantu seems not to have locked itself in the consumer “comfort zone.” Since 2024, the company has clearly accelerated its layout in directions such as AI and biological pharmaceutical products.

In the same year, Tiantu raised 913M yuan of new capital from government guidance funds and leading industry enterprises, and set up two new RMB funds, one of which is dedicated to early-stage projects in the low-altitude economy sector.

In 2024, Tiantu completed investments in 13 portfolio companies in cutting-edge fields such as biotech, beauty and wellness, and clean technology, with a total investment amount of 0.23 billion yuan.

By 2025, the pace accelerated further. Tiantu set up four RMB funds and one USD fund in one go, raising about 2.3 billion yuan in capital. In the same year, it completed investments in 13 companies in areas such as AI infrastructure, biotech, low-altitude economy, and food and beverage, with a total amount of 409M yuan. This investment amount is nearly double that of 2024.

Entering 2026, Tiantu’s strategic upgrade path is even more determined. The company said that in the technology sector, investments are no longer tentative cross-sector experiments, but instead have formed clear investment themes and a mature post-investment enabling system. At the same time, Tiantu is also closely watching emerging opportunities such as data centers, Web3 infrastructure, and encrypted assets.

As of the end of the reporting period, Tiantu’s total assets under management were about 20.4 billion yuan, including 16.0 billion yuan of fund assets and 4.4 billion yuan of direct investments. The company serves as fund manager for 22 investment vehicles, covering 18 RMB funds and 4 USD funds. Of these, 14 funds focus on early-stage investment, while the remaining 8 target mid-to-late stage opportunities.

Overall, Tiantu Investment’s 2025 performance report includes both “paper wealth” valuation recovery and real improvement at the cash-flow level; it includes both a steady commitment to the consumer core base and an audacious expansion into the technology track.

But the other side of the coin is equally clear: management fees continue to shrink, the cash safety buffer declines, and large net cash outflows from the financing side… these are issues Tiantu cannot afford to ignore.

In 2026, whether it can find a balance between investing in new tracks and ensuring cash-flow safety will be an answer Tiantu must write by putting pen to paper.

Disclaimer: The contents and data in this article have been compiled by Guan Dian Viewpoint based on publicly available information and do not constitute investment advice. Please verify before use.