image image

China technology

What ‘capital winter’? Sequoia Capital’s Neil Shen says there’s still plenty of money around for China’s start-ups

  • Sequoia Capital China and ZhenFund will soon set up a non-profit management programme to coach start-up entrepreneurs, according to Shen
PUBLISHED : Thursday, 08 November, 2018, 3:35pm
UPDATED : Thursday, 08 November, 2018, 3:52pm

A top Chinese venture capital investor has dismissed concerns about a drought in funding for the country’s start-ups, urging instead that more attention be placed on supporting budding businesses.

There is no “capital winter” and there is plenty of funding in the yuan-denominated market, Neil Shen, the founding and managing partner of Sequoia Capital China, said on a panel at the World Internet Conference in Wuzhen, China, on Thursday. The stock market also provides a very good way for investors to exit their start-up investments, he said.

There needs to be more attention on early seed fund investments even though they are still small, he said. To support budding businesses, Sequoia and ZhenFund will soon set up a non-profit management programme to coach start-up entrepreneurs, Shen said, without giving additional details.

Winter is coming for China’s private equity as market rout slashes start-up firms’ valuations

Shen is regarded as one of China’s most influential start-up investors and one with a Midas touch. He backed Alibaba Group Holding, owner of the South China Morning Post, when the Hangzhou-based company was still a scrappy start-up. His other investments include local services firm Meituan Dianping and video-and-news app operator ByteDance, now the world’s most valuable start-up at US$75 billion.

Sequoia China head Neil Shen tops Forbes’ global list of leading technology venture capitalists

Speaking on the impact of the US-China trade war, Shen said that China’s digital ecosystem will not be affected. For Chinese businesses, the trade war presents both challenges and opportunities, he said. While many Chinese companies previously only went for the low-hanging fruit and had only Plan A, many are now seeking Plan B, which bodes well for the development of sectors like deep tech, he said.