China VC investment declines

Venture capital investment in mainland Chinese companies declined significantly in the first six months of the year, the latest sign of weakening economic outlook in the world's second-largest economy.

According to Dow Jones VentureSource, which tracks venture-backed companies, the value of venture capital investments in Chinese companies was US$1.9 billion in the six months through June, down 43% from the same period last year. The number of deals declined 38% to 103. Each deal represents a single case of investment by a professional venture capital firm, corporation, private equity firm or individual.

Commenting on the decline, Guido Schenk, APAC and EMEA sales director for Dow Jones VentureSource, said: "Venture capital firms are being more selective in considering their China investments, particularly given the uncertain macroeconomic landscape and challenging exit environment. Until IPO and M&A activity in China pick up, we're unlikely to see a jump in venture capital investment."

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