China Doors Swing Open to More VC Investment Funds

Filed in archive Venture Capital on April 1, 2006

Corstone Capital, a Rockville, Maryland based merchant bank, joins the increasing list of American funds raising money to invest in China with the successful completion of its $100 million fundraising efforts.

The fund joins others in this new frontier of growth. The Corstone China Fund is slated to invest upwards of $3 million to $7 million per round in 10 to 15 technology or service sector revenue generating companies. The fund is supported by Edison Ventures, Hyundai Securites, Woori Securities and Shinhan Securities.

While the western media, including business consultancy bloggers herald China's reforms, it's important to note that according to the National Development and Reform Commission, that even if China maintains its present 8% growth rate this year, the Middle Kingdom still only provides new jobs for 11 million out of a total of 25 million urban unemployed and new entrants to the labor force.

It's no wonder that the red doors to investment, especially venture capital, are now swung wide open to the west. China is banking on these new ventures creating jobs for its burgeoning labor force.

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Response from: Jeremy Gordon (04/05/06 5:31am)

Thanks for the reference to China Business Blog, and for your intersting site. I just wanted to make a response to the comment that we "herald" the 5-year plan. The main point I wanted to get across in my last post on the subject was not about the targets (which may be missed, manipulated, or even met) but about the change in attitude - i.e. it is a "guideline", not just another "plan". As for ("malicious")foreign funds in China, there are obviously some political challenges at present - but it is interesting to see that UBS just got approval for their control of Beijing Securities (I have posted a note on this on the blog today). I look forward to reading more of your news.

Response from: Small Business Loans (05/01/07 9:40am)

The combination of massive capital investement, low cost labor and a blossoming domestic consumer economy presents a rare opportunity to invest in a nation poised to become an economic superpower.

Response from: counter stools (05/04/07 8:51am)

It doesn't have to become an economical superpower just be the best and/or first in this matter. That would make competition look a little more interesting don't you agree ?

Response from: naughty (06/14/07 5:52am)

The Corstone China Fund is slated to invest upwards of $3 million to $7 million per round in 10 to 15 technology or service sector revenue generating companies.

Response from: Marine Engineers Beneficial Association (06/16/07 10:09am)

So what happens with the rest of 14 million ? do they remain unemployed?