Beijing-based market researcher ITjuzi on Wednesday released the 2021-2022 Report on Entrepreneurship and Investment in China’s New Economy. The document offers insight into developments that occurred last year across new economic fields including TMT (technology, media and telecommunications), the internet, next generation information technology, biomedicine, new energy, new materials and high-end manufacturing.
In 2021, there were 6,884 deals in the field of equity investment in China’s new economy, covering 21 sectors mostly in hi-tech and internet-based areas, and involving a total amount of 1.374 trillion yuan ($216.8 billion), a record high.
From the perspective of specific fields, health care and AI were the two hottest industries in 2021, with more than 1,000 annual deals and a total financing amount of about 300 billion yuan, which is way more than other new economic sectors.
Among various sub-sectors, the report claims that the biopharmaceutical and semiconductor areas saw the most deals in 2021, with 619 and 570 investment deals, respectively, far exceeding other sub-sectors.
However, some have declined significantly. For example, investment in K12 education and community group buying (CGB) has declined significantly compared with 2020. After the second half of 2021, the situation for CGB turned downward sharply. At present, the sector’s financing amount is basically at the bottom.
The report also carded the 30 companies with the highest financing scale in 2021, focusing on AI, new energy, autonomous driving and new energy vehicles.
The highest one is Chongqing Ant Consumer Finance Co., the consumer-finance arm of China’s Ant Group, which received 30 billion yuan in financing last year. The annual financing amount of J&T Express reached $4.55 billion, while the third-place firm was Xingsheng Selected, also known as Xingsheng Youxuan, a CGB company with an annual financing amount of $3.3 billion. The top ten enterprises also include SVOLT, SenseTime and Deepshire.
In addition, Tencent Investment was still the most active corporate venture capital (CVC) institution in 2021, with 207 deals in China – an increase of 97 from the same period last year. Xiaomi and ByteDance were second and third, with 69 and 51 domestic deals, respectively.
Compared with 2020, ByteDance, Xiaomi and Bilibili‘s domestic deals in 2021 increased by 45, 28 and 29, respectively, exhibiting strong momentum. The upward increments of other CVC institutions were below 20, while the number of deals made by Hubei Xiaomi Changjiang Industrial Investment Fund Management Co., Ltd. even decreased.
In terms of independent venture capital institutions, the top three in the primary market during 2021 were Sequoia China Investment Management LLP, GL Ventures and Matrix Partners, with 268, 164 and 153 deals, respectively. The top 10 established VC institutions also include Shunwei Capital, Shenzhen Capital Group Co., Ltd., IDG Capital, Cowin Capital, 5Y Capital, Addor Capital and ZhenFund.