[Tech & Startups] Angel investment in China: winter is coming

[Tech & Startups] Angel investment in China: winter is coming

Originally published at knowledge.fredfarid.com.

Bruno Bensaid, ShanghaiVest’s founder, warns the Chinese tech ecosystem: winter is coming in China and “early-stage startups will suffer, especially the ones that don’t bring much to the market. But these startups should never have been funded in the first place, so it is only divine justice they be axed”.

This French investor is talking about all those Chinese startups that have recently been funded by thousands of new Chinese business angels after Alibaba IPO in 2014. After this one, the number of business angels went from a dozen to thousands! The new generation of wealthy Chinese businessmen rushed into the craze to invest in tech sector. However, most of them were clearly lacking most of the necessary skills to make the good choices of investment in the first place. Consequently, crazy valuations have been given to startups without a proper business model.

Winter is coming in China and we will face a lot of disappointment.

Source: Shanghai Tech Insights

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