Venture capital investments in Greater China witnessed strong growth during the first quarter. Total venture deal value hit US$2 billion, more than double the US$800 million registered during the fourth quarter last year, according to research firm Preqin.
The jump in venture deals was the result of several large transactions led by China’s largest Internet companies. They include Tencent’s $400 million investment in Chinese Yelp-like review website Dianping.com, Tencent’s $214.7 million investment in JD.com, and mobile Internet e-commerce company Mmb.cn’s over US$200 million financing led by Tencent and Taiwan-based fabless semiconductor company MediaTek Inc.
"Even though the majority of investment was in North American companies, there seems to be a rejuvenation of the Chinese venture capital industry, with US$2.0 billion worth of deals being announced, almost topping the US$2.3 billion which was invested in the whole of 2013," says Ignatius Fogarty, head of private equity products at Preqin.
Globally, venture investments also saw robust expansion during the first quarter. A total of 1,402 venture deals with aggregate deal value of US$15.6 billion was the highest quarterly deal value since the financial crisis in 2008.
It also represents a significant increase from aggregate deal value of US$10.0 billion for the first quarter of 2013.
Total deal value in North America stood at US$10.6 billion during the first quarter, up from US$8.6 billion the previous quarter.
Globally, average deal size of venture capital investments has increased from US$7.0 million in the second quarter 2013 to US$11.1 million in the first quarter this year.
The highest number of deals continues to come from the Internet sector, accounting for 27% of the number of deals.
This quarter, Internet deals also accounted for the highest value of all venture capital deals of any sector at 30%, up from 24% the previous quarter, surpassing software and related deals.