ONCE marketed with great fanfare as an “epoch-making gala for investors,” the six “unicorn” funds quietly began operations Monday — alongside Xiaomi Corp.’s lackluster Hong Kong debut — after raising just one-third of their original targets.

The six funds, launched to support mainland listings of home-grown tech firms such as smartphone maker Xiaomi and e-commerce giant Alibaba Group Holding, originally sought to raise 300 billion yuan (US$45.33 billion) from retail and institutional investors.

But they ended up with only 104.9 billion yuan among them, according statements, despite a massive marketing effort orchestrated by Chinese regulators.

The shortfall reflects reduced appetite for much-hyped tech IPOs. The funds were promoted as a special opportunity for individual investors, who are allowed for the first time to participate in tech IPOs as cornerstone investors along with institutions.

But retail investor David Song said he was not impressed.

“I’m very cautious toward such innovative funds, and I know little about CDRs,” Song said, referring to Chinese Depository Receipts, the instruments overseas-listed firms use for domestic listings, and to which the funds will subscribe.

Some investors have drawn parallels between the unicorn funds and China’s first outbound QDII funds 11 years ago. Those funds burned investors after global markets collapsed during the 2008/09 financial crisis.

“The smell is very similar,” wrote Huang Tao, strategist at Beijing Heju Investment, adding that in both eras, valuations of overseas-listed tech firms were near historic levels. (SD-Agencies)