Chinese AI venture investment deals fell 63 percent in value during the first half of 2019, but AI leaders remain upbeat
As mentioned in Wednesday’s post, investment in Chinese tech ventures has continued to slow down throughout the first half of 2019. As we leave H1 behind, more and more data is coming out to support this.
Yesterday, the South China Morning Post published figures from Beijing-based information source ITJUZI.com, reporting that ‘new economy’ investments in China continued their slide into the second quarter, dropping 62 per cent year -on-year to RMB 154.3 billion ($22.4 billion). The only bit of good news was that the overall rate of decline in investment may have slowed from Q1 to Q2.
Meanwhile, the number of AI-specific investment deals fell to 30 from 55 during the same period last year, with the overall value of those deals dropping 63 percent year-on-year.
Of course, there are a long list of factors influencing the slowing of Chinese tech investments, but the slowing global and regional APAC economic growth is a powerful one. Earlier this month, the World Bank advised that China economic growth may decelerate from 6.6 percent in 2018 to 6.2 percent in 2019. The ongoing trade dispute between the U.S. and China certainly isn’t helping and, by all accounts, is going to remain an unsettling factor for some time to come.
However, the sheer volume of activity in China’s emerging technology sectors and global expansion of leading AI developers has ensured that the AI sector remains overwhelmingly positive. Of the RMB 362.9 billion ($52.6 billion) of fundraising deals during H1, the largest — by far — were AI tech or AI-driven.
In light of the slowdown in VC activity, China Money Network recently surveyed a panel of Chinese AI experts, who seem to confirm that the AI industry’s own outlook for AI investments in China remains very positive.
A version of this article was originally published by Carrington Malin in Asia AI News daily email newsletter on 6 July 2019.