China surpasses North America in attracting venture capital funding for first time as investors chase 1.4 billion consumers
China start-ups accounted for 47 per cent of the world’s venture capital funding in the second quarter, the first time the country has surpassed North America in fundraising
China surpassed North America in attracting venture capital for the first time in the second quarter, helped by a record US$14 billion fundraising round by Alibaba Group Holding affiliate Ant Financial Services.
Start-ups in China accounted for 47 per cent of the world’s VC funding in the three months ended June, compared with a combined 35 per cent for the US and Canada, according to a report by Crunchbase, which tracks and compiles fundraising data.
The surge in China fundraising in the second quarter could be attributed to Ant Financial, which raised about US$14 billion last month. Investors, including Singapore’s GIC and Temasek Holdings, Warburg Pincus, Canada Pension Plan Investment Board and Silver Lake, took part in the fundraising, while existing shareholders supported a yuan-denominated tranche.
Excluding Ant Financial, China’s start-ups raised just slightly more than they did in the first quarter, taking up 36 per cent of the global total, according to Crunchbase. The financing brought Ant Financial’s valuation to more than US$150 billion, which is roughly double Uber Technologies’ valuation, the report said.
China has seen a surge in the number of start-ups in recent years as the government vowed to do more to implement an innovation-driven development strategy to make the country more competitive.