China's homegrown private-equity firms are looking for money overseas, in part to diversify their investor base and expand their brands abroad. Moreover, raising money domestically has become tougher amid a slowing economy.

For all but the biggest names, however, winning over Western investors hasn't been easy.

Hao Wu, chief executive of Sino-Century China Private Equity Partners, said the process for Chinese money managers to get overseas money can be "very long" because Western investors aren't familiar with local names.

"We're not like KKR, Carlyle, TPG, Blackstone, who are household names," he said. Shanghai-based Sino-Century started raising a $350 million fund last year, and expects to close it in the first quarter next year.

Domestic-based private-equity fund managers raised about $12 billion in dollar-denominated funds in 2011 aimed at Chinese investments, according to data by research firm Preqin.

The amount raised overshadowed some $4 billion raised by foreign-based funds last year. Yet this year, domestic-based fund managers so far have only raised $1.3 billion while their foreign counterparts have raised $3.6 billion.

Private-equity firms want to raise dollars because that lets them more easily invest in Chinese companies that want to eventually list on U.S. stock exchanges or make acquisitions overseas without dealing with currency restrictions.

The majority of some 100 prominent Chinese firms managing yuan-denominated funds are looking to tap new investors abroad, estimated Jordan Silber, a lawyer at Cooley LLP who divides his time between Shanghai and San Francisco.

"Savvy renminbi [yuan] fund managers have come to realize that any 50-year, long-term viable strategy probably depends upon securing an outside-of-China capital base in addition to an inside-of-China one," Mr. Silber said.

The largest dollar-denominated private-equity funds raised for Chinese investments in the last two years were managed by the China offices of Western firms or China's oldest private-equity names. Among them are KKR & CoKKR -4.35% . LP's $1 billion China Growth Fund, Sequoia Capital's $1 billion early stage fund and a $2.37 billion buyout fund run by Beijing-based Hony Capital, founded in 2003. For years, such firms have been finding money from western institutional investors and university endowments.

Most private-equity money managers in China, however, are more accustomed to answering to a different investor base: rich Chinese individuals as well as state-affiliated entities that tend to be less rigorous in their research on different funds, industry experts say.

The relationship most local money managers have with their investors is "very informal," said Mr. Wu. "Western limited partners are much more demanding."

Chinese private-equity firms tend to be more short-term oriented, a result of having local investors who often demand that their money be returned more quickly compared with Western investors. Private-equity investors sometimes pay lower management fees when they co-invest in China with Chinese private-equity firms. And most firms rarely include what is known as a "key-man clause" in their agreements with investors, which protects the investor if a top fund manager leaves.

"Many funds in China rely on the brand name and size of their platform rather than on key individual managers," said Vincent Ng, a Hong-Kong based partner at placement agency Atlantic-Pacific Capital, which helps fund managers find investors. By contrast, for example, he said, nearly all Western institutional investors require a key-man clause.

Chinese private-equity firms that have publicly disclosed dollar-denominated funds recently include Delta Capital, which is targeting a $200 million fund, and Kaiwu Capital, which is seeking to raise $150 million, according to U.S. Securities and Exchange Commission filings made in June and August, respectively.

Both declined to comment on their funding.