Chinese venture capital activity continued its blistering pace of growth in April, with investors inking 209 deals with venture-backed companies worth a total US$15.59 billion (RMB 99 billion). April’s total VC deal value in China was 166% higher than the monthly average in the U.S., according to the China VC Tracker released by China Money Network today. By comparison, in the U.S., during the first three months of 2018, investors deployed an average US$9.4 billion per month (RMB 60 billion), for a total US$28.2 billion (RMB 180 billion) in the first quarter. That number is the highest amount in any single quarter since 2006, PitchBook data showed.
China’s venture capital market is being buoyed by the aggressive investment pace of its largest technology giants, including Tencent, Alibaba and Baidu. The three firms ranked as the first, fourth and eighth most active investors in the past month, inking 11, 5 and 4 deals respectively. Tencent and Alibaba participated in deals totaling US$5.7 billion (RMB 36 billion) and US$1.7 billion (RMB 11 billion), respectively, while Baidu was involved in deals worth US$154 million (RMB 980 million).
Sequoia Capital was the second most active investor, having invested in 9 deals worth a total of US$5.3 billion (RMB 34 billion), far ahead of its peers. Other investors making the most deals last month included Zhen Fund, IDG Capital, Qiming Venture Partners, Legend Capital and JD.com.
Government funds also contributed to the elevated VC deal activity by leading some massive funding rounds. China Reform Fund Management Co., Ltd, an investment firm backed by China Reform Holdings Corporation Ltd. and Chinese state-owned enterprises, led a RMB 1 billion (US$159 million) series C round in fintech start-up 100Credit. It also teamed up with Softbank Vision Fund to invest US$1.9 billion (RMB 12 billion) in Chinese truck-hailing firm Manbang Group.
Not only did Chinese VC investors deploy much more in aggregate terms than their U.S. counterparts, they also made bigger-ticket capital injections per deal. The average deal size in China was US$70.24 million in April (RMB 447 million), more than four times the US$16.7 million average deal size in the U.S (RMB 106 million). during the first three months, according to data from China VC Tracker.