Venture capital investment in China

2025

Launch of three venture capital funds to invest in IT equipment

On December 26, 2025, the Chinese authorities launched three venture capital funds that will focus on investments in IT equipment. Their creation is part of the comprehensive efforts of the PRC government to ensure technological independence, which is important in the context of aggravated relations with the United States.

Each of the funds will receive more than 50 billion yuan (approximately $7.11 billion at the exchange rate as of December 26, 2025). Investments are planned to be carried out mainly in startups in the early stages of development with an estimate of less than 500 million yuan ($71.14 million). At the same time, the size of individual investments will not exceed 50 million yuan (about $7.11 million). The National Development and Reform Commission (NDRC) reported that decisions on the allocation of funds will be made in accordance with the principle of "invest early, in small amounts, in advanced technologies and with an eye to the long term."

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Фото: Freepik

The funds are expected to support companies specializing in integrated circuits, quantum technologies, biomedicine, brain-computer interfaces and aerospace development. Other important areas are named artificial intelligence and projects in the field of power.

To address the increased risks associated with early projects, a management approach combining online monitoring with on-site control is planned. This is intended to provide comprehensive and transparent oversight of compliance, as well as earlier identification, prevention and mitigation of potential issues. It is expected that in the future more than 600 sub-funds will be formed in the Beijing-Tianjin-Hebei region, in the Yangtze River Delta region and in the Guangdong-Hong Kong-Macau Greater Bay region.^[1]

China has created a state fund to invest $138 billion in robots and AI

In late March 2025 National Development and Reform Commission China , it announced the creation of a state venture capital fund focused on, and robotics artificial intelligence advanced developments. The new structure is expected to attract about 1 trillion yuan ($138 billion) of capital from local authorities and the private sector within 20 years.

The initiative aims to consolidate China's success in the production of industrial robotics and the development of new technologies. As noted by the International Federation of Robotics (IFR), in ten years (by 2023), the share of the PRC in global supplies of industrial robots increased from about 20% to more than 50%.

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Фото: Freepik

Chinese robot manufacturers have been able to significantly expand their share of the domestic market. In particular, the annual installations of industrial robotic complexes by local players increased from 30% in 2020 to 47% in 2023. Chinese robot companies are benefiting from a growing consumer market. In addition, various industries are actively developing automation capabilities: the introduction of robots allows not only to reduce the burden on personnel, but also to improve the quality of products, as well as reduce the number of errors associated with the human factor. Chinese manufacturers supply 54% of robots for the domestic electronics industry market, as well as 85% of robots for the metallurgical and engineering industries.

The IFR notes that China intends to integrate robotics with other advanced technologies, such as artificial intelligence. This will expand the functionality of robots, which will open up new options for their use. In addition, the segment of humanoid robots is actively developing in the PRC.^[2]

2024: China overtakes the United States in the number of new startups worth from $1 billion

China for the first time overtook the United States in the number of new startups, the cost of which exceeds $1 billion. This became known on August 14, 2024. Read more here.

2023:90% of global venture capital investment in chips comes from China

In early July 2024, the analytical company Preqin published a report according to which 90% of venture capital investments in the global semiconductor industry are in China. While total funding continues to fall, investors continue to invest in tech sectors of China's economy, such as artificial intelligence research and the semiconductor industry.

In 2023, China received 90% of global venture capital investment in the chip manufacturing sector totaling $22.2 billion, more than double the amount invested in 2022. Half of the venture capital investment in the semiconductor sector came from three "mega-deals" struck between the municipal authorities and Sino IC Capital, the asset manager of China's Integrated Circuits Industry Investment Fund.

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Фото: Unsplash

Investment in the sector has since fallen, with only $1.6 billion invested in 128 deals in the first half of 2024. However, China still accounted for four of the world's top ten investment deals in the semiconductor industry.

Government-backed investors are playing an increasingly significant role in financing the private market in China. They took part in approximately 60 of the top 100 deals from 2021 to June 2024, double the number of related deals between 2017 and 2020.

In addition, in 2024, large investments in the development of AI and environmentally friendly technologies were also recorded. Among the top 10 venture capital deals registered from January to June 2024, two took place in China. Electric car maker IM Motors raised $1.1 billion, and generator AI startup Moonshot AI raised $1 billion. Both companies received support from Alibaba Group Holding.^[3]

2021: Venture capital investment in China rose 50%, to $130.6 billion

At the end of 2021, venture capital investments in China reached $130.6 billion, a record for the country. Compared to 2020, the figure increased by 50%, from $86.7 billion.

Entrepreneurs and venture capital firms have shifted their focus from internet businesses to technologies such as semiconductors, robotics and enterprise software, according to research firm Preqin. For example, the amount of money invested in biotechnology in 2021 reached $14.1 billion, which is ten times more than in 2016.

Venture investments in China grew by 50%, to $130.6 billion

China still lags far behind Silicon Valley in terms of venture capital investment in general. In 2021, the United States reached its new record of $296.6 billion, more than twice the total for the Asian country. But in some fundamental technologies, China has already surpassed the United States. For example, Chinese chipmakers, integrated circuit developers and other startups that specialize in semiconductors received $8.8 billion in funding in 2021, more than six times the $1.3 billion invested in comparable companies in the United States.

In its latest five-year economic plan, unveiled in March 2021, Beijing set targets to increase national spending by RESEARCH AND DEVELOPMENT more than 7% a year and highlighted seven technological areas in which the country hopes to achieve significant breakthroughs. They include space exploration, brain science and quantum information - all sectors in which American companies lead the way. The Chinese government is also betting big on new hydrogen technologies like cars and biotech, while helping its semiconductor industry close the gap with companies like and. Intel TSMC^[4]

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