Business / Companies

China's Inno Way lures startups with easy money

(Xinhua) Updated: 2016-06-29 14:23

BEIJING - Inno Way, a section in Beijing's Zhongguancun area, is home to many of the country's top tech firms and it is becoming a deep-pocketed rival to Silicon Valley venture capital hub Sand Hill Road.

Since 2014, the government-backed incubator has attracted hundreds of startups and thousands of investors and entrepreneurs from China and beyond.

Inno Way is becoming a better choice than its US rival for many cash-strapped international companies seeking funding. Zhongguancun investors have more money to spare, plus they offer access to the huge Chinese market.

Street Scooter, a German startup, just raised one million euros in financing from seven Chinese investors through Angel Crunch, an Inno Way-based crowd-financing platform that lets investors fund startups in exchange for equities.

The six-year-old company plans to produce electronic vehicles to replace 30,000 cars used by the German mail system. The first 2,000 vehicles will be delivered and put into use this year, the company said.

"More international companies are seeking funds in China, especially at Inno Way," said Lan Ningyu, the founder of Angel Crunch.

According to Bi Sheng, strategy executive at Angel Crunch, another German electronic car company, e.Go, is joining the financing platform to seek funds in China.

Angel Crunch is expanding to offices in Silicon Valley and Archen in Germany and expects to draw more international companies, according to Lan.

"Some foreign companies have told me that it might take more than six months to raise the money overseas, but it only takes three months here in China," said Mao Daqing, founder of Urwork, an incubator at Inno Way.

According to Bi from Angel Crunch, more foreign companies are raising capital in China, not just for the money, but also for the Chinese market and more business resources.

According to the latest statistics from Zero2IPO Group, equity financing rose in April, unleashing more funding to back startups. Total investment in China in April topped $10.7 billion -- twice as much as the same period last year.

WuXi AppTec Inc., a leading global pharmaceutical and medical device outsourcing company with operations in China and the United States, opened an office at Inno Way earlier this month.

"With government support and business resources, we believe Inno Way is a good choice for us to offer professional consulting and provide a technology platform for more pharmaceutical startups," said Yang Qing, COO of the company.

Yang Hongbo, CEO of Haizhikechuang, which operates Inno Way, said that the incubator helps introduce new ideas from abroad to China, while linking Chinese entrepreneurs to overseas resources.

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