China VCs have a big problem and its not just a drop in U.S. investor appetite

2023-09-19 00:30:15  • 6 mins

Key Points

  • Among China-focused investment firms, only four U.S. dollar-denominated venture capital funds established between 2015 and 2020 have at least returned investors all the money they put in.
  • That's according to a new report "China's Private Capital Landscape" from Preqin.
  • While those funds may have a few more years to go before they really need to show performance, their difficulties so far reflect a lack of IPOs even before the latest market slump.

Pictured here is Shenzhen in southern China. The city is sometimes considered China's Silicon Valley.

Nurphoto | Nurphoto | Getty Images

BEIJING In the years since Alibaba's U.S. listing in 2014, early-stage investing has drawn tens of billions of dollars into China with relatively little to show for it.

Among China-focused investment firms, only four U.S. dollar-denominated venture capital funds established between 2015 and 2020 have at least returned investors all the money they put in.

That's according to a new report "China's Private Capital Landscape" from Preqin, an alternative assets research firm. Alternative assets include venture capital, but not publicly traded stocks and bonds.

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