China’s Tech Titans Refocus For Deep Dive Into U.S. Startups

China Investment In U.S. Slows, Refocuses
China investment in the U.S. tech companies cooled off considerably last year in the wake of growing frictions over security, control and debt issues. And this cross-border deal flow will likely decrease more this year as China’s tech titans hone in on smaller, highly focused deals in emerging companies with much lower profiles rather than the headline-grabbing deals of recent years such as Uber, Lyft and Snap.
China investment in the U.S. information technology sector checked in last year at $13 billion, off from a peak of $16 billion the year before while the number of deals declined to 74 from 97 from a high in 2016.

Look for Baidu, Alibaba and Tencent, the leaders in U.S. tech investment, to refocus on highly strategic deals in specialized tech businesses. They already are!
Read Forbes: the BAT refocus

Two new investments by Tencent are closer to home in China: a $818 million Tencent-led funding of Chinese used car trading site Chehaoduo and a joint $18 million investment with Legend Capital in Beijing-baed Guanghe Technology, an online and mobile learning platform for grades K-12.

Sequoia Capital China has led a $50 million, 3rd round in Chinese travel guide service Hi Guides for outbound Chinese tourists. Return backer Matrix Partners China joined the financing. The tour guide startup’s Series A investment was by Gobi Partners.

Hong Kong-based medical services group Virtus Medical has snared $83 million in investment from Samena Capital in Mumbai and China biotech investor Cenova Capital in Shanghai.

INDIA
India deals have been picking up of late. This week’s roundup notes two new tech investments: Bangalore-based furniture retailer Urban Ladder has picked up $12 million more from existing investors Kalaari Capital, SAIF Partners and Steadview Capital to open more stores.
Sequoia Capital India has put $6 million in additional financing in lending company Finova Capital in Jaipur and servicing small businesses in villages and rural areas.

In other news from India, Westbridge Capital co-founders KP Balaraj and SK Jain are spinning out from the leading investment firm that broke away from Sequoia Capital to go back to its independent roots.

Separately, Westbridge co-founder Sumir Chaddha has funded the establishment of an India center at Princeton University to bring together scholars and students from all disciplines to broadly explore contemporary India, including its economy, politics and culture. The new center is also supported with gifts from six other Princeton alumni.

IPOs 

Heading to IPO

Chinese animation streaming portal Bilibili has filed to go public in the U.S., heading for NYSE and looking to raise $400 million in capital.

Chinese electric car startup NIO is preparing for a $2 billion IPO by the end of this year in the U.S. as it competes with Tesla. Goldman Sachs and Morgan Stanley are among the 8 investment banking firm hired. NIO is backed by Tencent, Sequoia Capital and Hillhouse Capital, which invested $1 billion just last November.

Team Ups
Honda Motor plans to develop intelligent-connected cars with Alibaba Group to offer online payments for fuel and parking for drivers. Honda aims to make inroads in the large Chinese market.

Hong Kong artificial intelligence unicorn SenseTime  (winner of Silicon Dragon’s 2018 Founder Award) has formed an alliance with MIT to research the frontiers of human and machine learning.  SenseTime was in Cambridge recently to showcase its facial recognition technology that relies on deep learning.

NOTEWORTHY
Goodbye copycat, China returns to its innovation roots.
Thanks to technologist Frank Palermo for mentioning Silicon Dragon’s part in spotting and writing about this trend early on. See Frontier Spotting.