Venture capital firm Matrix Partners China has closed its new fund at $1.6 billion in what was the largest China-focused venture fund raised this year, data from research firm Preqin showed.
Matrix Partners China VII, the new fund focusing on information technology industries, was closed on July 31, the data showed. The venture firm has not announced in public the closing of its new fund.
Public disclosures to US regulators showed the original target of Matrix Partners China’s new venture fund was $1.6 billion.
China’s faltering economic recovery and rising trade and geopolitical tensions with the West have reduced interest in investing in the world’s second largest economy, and China-focused private equity funds, which include venture, growth and buyout funds, have raised just $11.6 billion this year.
That compares with $74 billion raised for all of 2022, according to Preqin data.
The numbers are a far cry from a peak in 2016 when more than 1,500 China-focused funds raised around $300 billion.
US President Joe Biden ordered a ban in August on some new U.S. investment in China in sensitive technologies like computer chips.
In July, A U.S. House of Representatives committee launched an investigation into investments by four U.S. venture capital firms into Chinese artificial intelligence and semiconductor companies.
Matrix Partners China, which has offices in Beijing and Shanghai, did not respond to a Reuters request for comment.
Founded in 2008, the firm is one of China’s most seasoned venture capital investors focused on early stage and early growth deals.
It currently manages over 60 billion yuan in assets, focusing on software as a service (SaaS) and B2B platforms, deep tech, healthcare and consumer sectors, its website showed.
Matrix Partners China’s portfolio include auto chip designer and producer HUAV, 5G satellite Research and development company GalaxySpace and steel industry e-commerce platform Zhaogang.com, according to the website.
The firm was also among early investors in China’s ride-hailing giant Didi Global, which had been a target of Beijing’s sweeping crackdown on the tech sector in 2021.
Reuters