There has been a plateau in deal volumes in China over the past two years with other Asia-Pacific markets catching up, as adjunct professor Martin Haemmig noted at our last GCV Digital Forum at the end of January.
But China’s market has set the innovation bar higher in a host of fields, from ecommerce to artificial intelligence (AI) and electric vehicles. State-supported, mission-led innovation is a powerful aid to delivering a society’s vision – in China’s case leading the world in AI by 2030, Wired’s article notes.
The capital requirements, therefore, have scaled up to compete with the US and so fewer, larger deals makes sense.
A glance at the past week’s $100m-plus rounds, prepared by news editor Rob Lavine, shows China and the US still dominate the entrepreneurs gaining the funding to scale up to global champions.
China’s large, corporate-backed deals included:
Fenbi Education – $390m (IDG Capital, Huaxing Growth Capital, Hony Capital, Trustbridge Partners and unnamed others)
Pony.ai – $100m (Brunei Investment Agency and Citic Private Equity Funds Management)
Horizon Robotics – $350m (Sunny Optical Technology, BYD Auto, Great Wall Motors, Changjiang Automobile Electronic, Changzhou Xingyu Car Light, Dongfeng Asset, CMC-SDIC Capital, Shougang Fund and Shanghai AI Industry Fund)
Plus – $200m (Wanxiang International Investment, Guotai Junan International, Citic CPE and Full Truck Alliance/Manbang Group)
It was a powerful end to a year that saw the state tackle the power of a previous generation of entrepreneurial superstars, such as Alibaba and Tencent. And it remains a delicate balance to encourage innovation within restrictions.
The past 30 years have seen unprecedented numbers of people move out of poverty in China and the world through innovation and market forces. What the next year will bring will be further shocks and tensions – notably around Taiwan and geopolitics but remembering the sacrifices and accomplishments to get this far is important to build in the right direction.
Health, wealth, love, happiness and the time to enjoy it all. 恭祝大家，新春快樂，恭喜發財，身體健康，平安如意
