The expansion in China’s investment in synthetic intelligence ventures over the previous few years has been nothing lower than explosive. China is now house to extra ‘AI unicorns’ than wherever else in the world (statistics differ tremendously, however CB Insights counts six out of the highest 11 unicorns in its high AI startups record, whereas some others put the depend a lot greater).
In keeping with ZDNet, China’s funding of AI startups grew from about $1 billion in 2016 to greater than $eight billion in 2018, accounting for 44 p.c of all international AI startup funding (with the U.S.’s accounting for 41%).
Nevertheless, investment in China AI ventures has slowed tremendously in comparison with final yr. In keeping with new numbers from China Cash Community, the overall deal worth of $5.6 billion in the course of the first six months of 2019 (till mid-June), in contrast a complete worth of $15.7 billion throughout 2018 (sure, 2018 figures do fluctuate!). Certain, there’s nonetheless an opportunity that deal move and whole investment will improve in the course of the second half of the yr, nevertheless it does seem like a a lot slower begin to the yr (and this follows a dramatic slowing throughout second half of 2018).
The slow-down is borne out by the stats in KPMG’s Enterprise Pulse for Q1 2019, which reveals that VC investment — throughout all classes — in Asia fell dramatically in the course of the first quarter, from $16.9 billion in This fall 2018 to $13 billion in Q1 2019 (being the bottom quarterly whole since Q1’17). The quantity additionally continued the downward pattern that started in Q3 final yr.
China Cash Community calculates that the variety of mega rounds — enterprise offers better in worth than US$100 million — fell from 26 mega offers in 2018 to simply 4 in 2019 (up till mid-June).
It’s well-known that China’s economic system has slowed and the continuing US dispute with China on commerce can’t have helped both. No investor likes to take care of a broad vary of latest dangers. As identified by KPMG, some China VCs are undoubtedly sitting on portfolio investments ready for the best time to exit.
Given the huge progress in Chinese language AI investment throughout 2018 and the cooling enterprise capital exercise in the course of the previous yr, it’s an fascinating time to ask AI business heads what their imaginative and prescient is. China Cash Community requested 10 business leaders from China’s AI sector to offer their predictions for the following ten years. You may obtain the report right here.
A model of this text was initially revealed in Asia AI Information every day e-mail publication on three July 2019.