The China venture capital (VC) funding landscape experienced a decline in both deal volume and value during January to May 2023 compared to the previous year, attributed to geopolitical tensions and recession concerns. However, China remains a dominant player in the Asia-Pacific (APAC) region and globally, showcasing its continued significance in VC funding activities, reveals GlobalData, a leading data and analytics company.

An analysis of GlobalData’s Financial Deals Database revealed that 1,310 VC funding deals of worth $15 billion were announced in the China during January to May 2023, a year-on-year (YoY) 18.1% decline compared to 1,599 VC deals announced in January to May 2022. The corresponding disclosed value of these deals also declined by 37.5% YoY from $24 billion to $15 billion.

Aurojyoti Bose, Lead Analyst at GlobalData, comments: “Geopolitical tensions and recession fears seem to have had a dent in deal-making sentiments in China. However, despite the decline, China still continues to remain the top APAC market as well as one of the top five markets globally for VC funding activity both in terms of deals volume and value.”

China accounted for 14.4% share of the total number of VC deals announced globally during January to May 2023 while its share of the corresponding deal value stood at 14.3%.

Meanwhile, it accounted for 46.7% share of the total number of VC deals announced in the APAC region during January to May 2023 while its share of the corresponding deal value stood much higher at 57.6%.

Some of the notable VC funding deals announced in China during January to May 2023 included $750 million secured by Zeekr, $375 million fundraising by Libode, $340 million raised by SJSemi, $321 million fundraising by Yunnan National Titanium Metal, and $300 million worth of funding raised by JD Industry.

Bose concludes: “Despite the challenges, China’s innovation ecosystem remains a compelling destination for venture capital funding. The notable funding deals during this period highlight the ongoing investment interest in China’s innovative and promising startups, indicating the potential for future growth and opportunities in the country’s entrepreneurial landscape.”

Note: Historic data may change in case some deals get added to previous months because of a delay in disclosure of information in the public domain.