Chinese venture capital investor Source Code cuts bets on early-stage projects as tech landscape turns bleak
- Source Code Capital, which had invested in ByteDance and Meituan, is reportedly closing its early-stage investment programme
- Tightened regulatory scrutiny in China, a potential decoupling with the US, and slowing economic growth has put a damper on investor appetite for risks
A leading Chinese venture capital fund firm, which had invested in start-ups that went on to become the country’s leading tech companies such as ByteDance and Meituan, is ending a seed funding programme, according to local media reports, underscoring an increasingly hostile entrepreneurial landscape.
Source Code Capital, known for its extensive relationships within the Chinese tech industry, is shutting down Source Code Yisu, a project focused on early-stage investments, Chinese news outlet Jiemian reported on Tuesday, citing unidentified sources.
The programme was launched as an independent investment fund a year ago. Source Code, founded in 2014 by former Sequoia China investor Cao Yi, is in the process of streamlining its post-investment portfolio service, according to the Jiemian report.
Beijing-based Source Code did not respond to a request for comment on Wednesday.
Nearly two years of regulatory crackdown on internet companies in China, combined with decoupling risks with the US and a pandemic-induced economic downturn, have put a damper on investor appetite for early bets that usually entail higher risks.