Venture capitalists pump £74bn into China, despite regulatory storm
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China’s regulatory storm has not deterred business, nor investors, after venture capitalists pumped more than £74bn into the country last year, new data has revealed.
The VC market looks ‘surprisingly upbeat’, after investment swelled nearly 48.9 per cent year-on-year, according to GlobalData.
Meanwhile, deal volumes jumped nearly 32 per cent to 4,302 last year, up from 3,261 in 2020.
“Investors seemed to have become wary of China for some time on the back of a series of regulatory crackdowns on domestic companies. However, funding activity picked soon after a brief downturn,” lead analyst at GlobalData, Aurojyoti Bose explained.
“The announcement of several big-ticket deals during 2021 reflects investors’ appetite for placing bets on China is still bullish.”
December alone welcomed 32 deal announcements worth more than £73m each.
Beijing has been particularly hawkish on technology firms in the country – which has seen it shun crypto, impose new curbs on internet companies, tackle monopolies, as well as alter “foreign-related rule of law”, the government said in August.
It comes as abrdn seeks a Chinese partner for its wealth management business, chairman Douglas Flint confirmed today, as the fund manager eyes a larger slice of the growing market.
China’s wealth management market hit around £3.2 trillion in September last year, after climbing 7.8 per cent from the end of 2020.
“The change in regulation allowing greater access to the end consumer has made China a much more interesting market for people that want to deploy resources,” said Flint.