8 ms·
Chinese venture funding in U.S. startups has slowed under new regulatory regime
- jaimex2 8y agoOnly 3 billion? Thats chump change in SV.
- bassman9000 8y agoIndeed. $140B in 6 years https://www.cbinsights.com/research/report/global-tech-hubs/ https://www.cbinsights.com/research/report/global-tech-hubs/
- ThomPete 8y agoEveryone wants improvement but hate change. I for one welcome this stance and although I fear it won't help much as this is about technology and technology > the policy but hopefully the consequences of this will have some illuminating outcomes.
- Roritharr 8y agoI wonder if this will accelerate Chinese Investment in EU Startups?
- tanilama 8y agoI doubt they will be particularly interested in EU, maybe excluding some gaming studios.
- TomMarius 8y agoActually the exact opposite, Chinese investment in EU is at all time high and increases rapidly. They even have direct flights to many cities now, and every month there is a new line open. Advertisement of jobs for Chinese companies that are now in EU is everywhere. Chinese people are now everywhere.
- mark_l_watson 8y agoNot in France. I just read that they are working on blocking foreign investment in key tech like AI, crypto, etc.
- nopetrain 8y ago>key tech like AI, crypto Crypto is not a key tech.
- StreamBright 8y agoAnd it never will be. I don't understand why so many people on Hn are obsessed with this utter garbage what crypto means.
- JumpCrisscross 8y ago> Chinese venture funding in U.S. startups has slowed to a trickle, Reuters interviews with more than 35 industry players show Garbage article based on a small sample of anecdotes. In that spirit, I’ll add one. I work with international investors. Chinese interest in American technology companies continues to rise. If I were to characterise recent shifts resulting from politics, it’s one from controlling interests to minority interests and one from funds to direct investments. My guess is this Reuters author only spoke to VCs and M&A bankers. (Counterfactual: China’s biggest cheque writers were historically state-owned companies and mainland-listed companies buying earnings. The former is being politically checked. The latter lost steam when the Chinese stock market tanked. But neither is a major direct source of investment for early- or growth-stage companies, nor even the funds that invest in them.)
- ThomPete 8y agoI don't think the question is whether chinese are interested in investing in US technology companies but rather whether they are allowed to. Several countries within the EU are also working on rules which will make it much harder for Chines investors to acquire access to technology IP or important infrastructure companies. Other than that I agree the article is poorly researched.
- JumpCrisscross 8y ago> Several countries within the EU are also working on rules which will make it much harder for Chines investors to acquire access to technology IP or important infrastructure companies Many private companies resist disclosing even financials to their investors [1]. Venture investing is characterised by non-controlling interests. The restrictions you describe limit controlling investments. Those investments count as technology investments. But not as “venture funding in...startups.” [1] https://www.google.com/amp/s/mobile.reuters.com/article/amp/idUSKCN1G62NK https://www.google.com/amp/s/mobile.reuters.com/article/amp/...
- ThomPete 8y agoThe Chinese have never needed controlling access to benefit from access to the IP. That's the primary point of the disagreement with the Chinese over IP, enforcement more than legislation.
- shanghaiaway 8y agoI guess the US are against free markets
- spricket 8y agoChina is notorious for requiring "joint ventures" and other rediculous hoops to invest in China. The US wants free markets to go both ways. This is just like the trade tarrifs, some pressure to convince China to play by the same rules as other developed countries when it comes to trade and IP
- shanghaiaway 8y agoThis is whataboutism. The US is restricting the free market - regardless of what any other country does.
- spricket 8y agoIt's only restricting foreign investments from certain countries like China that don't play by the rules. It's like banning someone from your store because they steal stuff. The "free market" isn't anarchy, it's essentially a bunch of bilateral trade agreements
- shanghaiaway 8y agoNonsense. The US is restricting trade. Frankly, I'd like to see WTO step in here.
- dageshi 8y agoWTO will have little to say on the matter in the same way that it had little to say on the restrictions on trade China has enforced for its domestic market for decades.
- StreamBright 8y agoWell these guys downvoting you never heard of export regulations. Few links for those who are downvoting this comment above: https://www.theregister.co.uk/2015/04/10/us_intel_china_ban/ https://www.theregister.co.uk/2015/04/10/us_intel_china_ban/ https://wccftech.com/us-government-bans-intel-nvidia-amd-chips-china/ https://wccftech.com/us-government-bans-intel-nvidia-amd-chi... https://www.wsj.com/articles/u-s-agencies-block-technology-exports-for-supercomputer-in-china-1428561987 https://www.wsj.com/articles/u-s-agencies-block-technology-e... https://venturebeat.com/2018/11/23/u-s-lobbies-germany-italy-and-japan-to-ban-huawei-5g-equipment/ https://venturebeat.com/2018/11/23/u-s-lobbies-germany-italy... https://www.engadget.com/2018/08/14/us-defense-huawei-zte-ban/ https://www.engadget.com/2018/08/14/us-defense-huawei-zte-ba...
- zavi 8y agoHaving spent the last few weeks in Beijing, I can't help but think that any reasonable trade compromise should essentially require that China get rid of its Great Firewall. When you block and throttle essentially any foreign digital product and service in this day and age you are not practicing free trade. Tariffs / IP protections / dumping / FDI restrictions are all important but so long as the Firewall is in place international community should block China from selling any digital and physical goods. WTO rules should be updated to forbid digital blocking and throttling.
- chj 8y agostrange thing is that it is often ignored in trade negotiations.
- deleted 8y ago[deleted]
- adventured 8y agoThe firewall and aggressive social repression in general is a red line for China, much like their claims of owning Taiwan and the inevitability of annexation. The dictatorship that runs China - both the remaining old party system and the new system run by Xi - can't exist without the firewall, it's off limits accordingly. China won't come to the table if you put the firewall in the list of things to be negotiated, that's why it so rarely comes up. For them what that means is, they'd rather suffer any external consequences in trade & economy, and the domestic suffering that passes on to the people, than give up their reign.
- piiswrong 8y agoThe firewall will disappear when China has a strong enough propaganda machine that can counter the western propaganda machine (think Hollywood & BBC). China has been working on it for a few years. Shouldn't take too long. Maybe a decade or so.
- StreamBright 8y agoThe firewall is there so that Facebook and similar companies made it possible to Russia and other states to interfere with election in the US cannot do the same in China. Yes, China has elections. I think most western people believe that propaganda that the firewall is a tool for oppression.
- coliveira 8y agoAnother case where the US is shooting itself in the foot. Chinese money will now invest in local Chinese startups, which are growing very quickly, and in other countries other than the US.
- aaavl2821 8y agoI've been tracking venture investment in biotech and Chinese investment was pretty steady through all of 2018, though they began leading fewer deals and doing more follow on investments Anecdotally, there's a big healthcare conference in SF this week, and several of the Chinese investors we planned on meeting canceled their trips
- analyst74 8y ago> Anecdotally, there's a big healthcare conference in SF this week, and several of the Chinese investors we planned on meeting canceled their trips This is possibly due to escalation of the trade war into arresting prominent business people from the opposing side.
- thesausageking 8y agoWhat data are you using? Was there a change after the CFIUS rules went into affect on Nov 10th?
- aaavl2821 8y agoI'm using data I collected myself. No guarantee that it's comprehensive but it seems not far off the data collected by Pitchbook per this report [0] Don't have the data in front of me but I think the change happened a bit before november [0] https://www.prnewswire.com/news-releases/silicon-valley-banks-2019-healthcare-report-reveals-record-venture-investment-in-the-us-and-europe-300773638.html https://www.prnewswire.com/news-releases/silicon-valley-bank...