German venture capital funds will increase investment in China, and the scale of China's economic growth cannot be ignored
According to the Financial Times website on August 5th, a leading German venture capital fund plans to invest $700 million in Chinese startups, breaking the widespread negative sentiment of Western investors towards the Chinese technology market.
According to reports, Kasten Kosfeld, CEO of Bertelsmann Investment Company in Germany, said that during his visit to China, Chinese entrepreneurial talents left a "very deep impression" on him. In the next 3 to 5 years, Bertelsmann Investment Company will collaborate with large financial institutions, sovereign wealth funds and other investment partners to support Chinese technology companies and startups.
Kosfeld stated that Western media claims that China has struggled to recover economic growth after the pandemic, but this description is sometimes disconnected from the actual situation. He said, "It is obvious that China will not return to its 10% economic growth rate. However, even if the growth rate decreases, the scale of economic growth cannot be ignored."
Bertelsmann Investment Company is a part of the extensive Bertelsmann media empire, with Penguin Random House and music brand BMG being resources under the Bertelsmann umbrella.
Since its establishment in 2006, Bertelsmann Investment Company has invested 1.7 billion euros in over 400 companies and funds worldwide, with a portfolio value of approximately 3.7 billion euros.
According to reports, as a branch of Bertelsmann Investment Company that focuses on the Chinese market, Bertelsmann Asia Investment Fund was established in 2008 and has supported over 180 startups so far, including China's leading electric vehicle company NIO, streaming platform BIGO, and bike sharing company Mobike.
At the time when Kosfeld decided to increase investment in China, the US China relationship is falling into a tense situation. What makes the situation even more complex is that the United States also plans to establish an investment review mechanism to prevent US capital from flowing into sensitive industries in China, and the volatile economic recovery has also dealt a blow to Chinese technology stocks. In a strategic document released in July, the German government also warned domestic companies not to overly rely on China.
According to reports, the Bertelsmann family business can be traced back to 1835. Kosfeld was the seventh generation member of the family and was trained with another family brother to become the top management of the family business. Regarding the tense geopolitical situation, Kosfeld seems to be relatively calm.
The executive who became the CEO of Bertelsmann Investment Company last year told reporters that many investors are reassessing their strategies. But he also pointed out that the Chinese government is clearly working to restore economic activity and foreign direct investment.
He believes that achieving complete decoupling between the two major economic systems of China and the West will be very difficult.