VC investments from China down by 66% in 2020, startups to feel the heat

China, which was ranked third on the PE/VC investments by country of investors, in 2019 fell to the sixth position in 2020

T E Narasimhan Chennai
Private equity and venture capital investments in H12019 were 27% higher at $23.4 billion compared to  the same period last year, EY says

Chinese investors are not only seen as alternates to US-based funds but also bring additional value as strategic investors.

Private equity and venture capital investments from China have dropped nearly 66 per cent so far this calendar year to $909 million from $2.69 billion in the corresponding period last year.
There was also a concomitant fall in the number of deals to 30 till September 17, 2020, from 35 a year ago. A major chunk was venture capital investments, defined as investments in companies that are less than 10 years old. 
According to the data from Venture Intelligence, of the 30 deals reported in the period under consideration, 24 were VC investments and totalled $216 million. Last year, VCs accounted for 30 of the 35 deals recorded between January and September 17, 2019, and pumped in $446 million. For Chinese investors, the key bets were in non-banking financial companies, wealth management firms, banks, food delivery and e-commerce firms.

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First Published: Sep 17 2020 | 11:10 AM IST

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