Venture capital investment in China

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

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

According to the research company Preqin, entrepreneurs and venture capital firms have shifted their focus from Internet business to technologies such as semiconductors, robotics and corporate software. For example, the amount of money invested in biotechnology in 2021 reached $14.1 billion, which is ten times more than in 2016.

Venture capital investment in China increased by 50%, to $130.6 billion

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

In its last five-year economic plan, released in March 2021, Beijing set targets to increase national R&D spending by more than 7% per year and identified seven technological areas in which the country hopes to make significant breakthroughs. They include space exploration, brain science and quantum information - all sectors led by American companies. The Chinese government is also betting heavily on new technologies such as hydrogen cars and biotechnology, while helping its semiconductor industry close the gap with companies like Intel and TSMC.^[1]

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