Bearish China sentiment sends Apac venture capital fundraising down by record 49% in 2022

ASIA-PACIFIC venture capital (VC) funds fell by a record 48.8 per cent in aggregate capital raised, to US$29.4 billion in 2022 from US$57.4 billion the previous year, according to a new report by private market-intelligence firm Preqin.

The number of regional funds that raised capital also fell in tandem, to just 217 from 550 in 2021. This extended the declining trend that started in 2018.

Preqin said in an e-mailed statement: “The sharp drop in fundraising among VC funds in the Asia-Pacific is due to dampened risk appetite among investors in China – the heavyweight fundraiser in the region. The decline is a consequence of China’s regulatory crackdown on tech firms, an economic slowdown exacerbated by strict Covid-19 policies and strained relations between US and China.”