China’s Silicon Valley throws money at tech start-ups as government takes over
More than 600 start-ups have sprung up on a street in China’s Silicon Valley in the last 12 months, as Beijing bids to turn its key technology hub into a start-up hotbed.
Over 350 have received funding to scale up their businesses within a year of the government taking over Inno Way, a street in the capital’s Zhongguancun Science Park, according to the industrial park’s website.
Zhongguancun is home to a raft of established Chinese technology companies, from PC maker Lenovo to search engine operator Baidu and leading smartphone maker Xiaomi. It is close to Peking University, China's top institute of higher learning.
Start-ups in the park are not faring too badly either, with average investment on Inno Way standing at 5 million yuan (US$805,000), park authorities said.
Before it was earmarked by the government, the 200-metre-long street was full of bookstores and small restaurants. It now plays home to over 4,000 start-ups and is crowded with funding and training institutions, as well as cafes that also serve as incubators.
Start-ups that originated on the street have attracted a total investment of 1.75 billion yuan so far, according to the local government.
China has been pushing innovation and entrepreneurship in a bid to reverse its recent economic slowdown and help it restructure.
The State Council, China’s cabinet, recently approved a raft of measures aimed at making it easier to get start-ups off the ground. Moreover, at a meeting last week, it laid out a new vision for bringing entrepreneurship to the Chinese countryside.
Beijing began offering start-ups on Inno Way a good deal more policy support in June 2014.
Together with private company TITH Holdings, the local government spent 200 million yuan to acquire and renovate houses on the street last year. It also pledged to help tenant companies find angel investors while enjoying free office space and media coverage there.
The street got a huge boost last month when premier Li Keqiang turned up at 3W Cafe, a famous hangout for start-up entrepreneurs.
With the help of local authorities, start-ups can expedite the business registration process and obtain all the required business and tax licenses, the park authorities wrote in a statement.
Shenzhen, Shanghai and several other cities are also vying to claim the coveted title of China’s Silicon Valley.