China has taken another decisive step to deepen its push for technological self-reliance, launching three massive state-backed venture capital funds aimed squarely at “hard technology” sectors seen as critical to long-term economic and national security goals.
State broadcaster CCTV reported on Friday that the capital contribution plans for the funds have been finalized, with each fund sized at more than 50 billion yuan ($7.14 billion), bringing the combined war chest to over 150 billion yuan ($21 billion). The scale alone makes the initiative one of the largest coordinated public venture capital efforts China has rolled out in recent years.
According to an official cited in the report, the funds will focus on early-stage startups, particularly companies valued at less than 500 million yuan. Individual investments will be capped at 50 million yuan, a structure designed to spread capital across a wide pool of firms and nurture an ecosystem of emerging technologies rather than concentrating funding in a few late-stage champions.
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The targeted sectors point to Beijing’s self-reliance priorities. Investment will flow into integrated circuits and semiconductor manufacturing, quantum technologies, biomedicine, brain–computer interface development, aerospace, and other advanced industrial and scientific fields. These areas are widely viewed by Chinese policymakers as bottlenecks where the country remains vulnerable to external pressure. By contrast, so-called “soft” technologies such as consumer internet platforms and online services are excluded, reflecting a deliberate pivot away from the platform-driven growth model that dominated the previous decade.
The launch comes against the backdrop of intensifying geopolitical and technological friction, particularly with the United States. Export controls on advanced chips, chipmaking equipment, and related technologies have sharpened Beijing’s resolve to build domestic alternatives and reduce reliance on foreign suppliers. Hard technology, in this context, is seen not just as an economic growth engine but as a strategic necessity.
Beyond geopolitics, the funds also address structural weaknesses in China’s venture capital market. Deep-tech startups typically face long development timelines, heavy capital requirements, and uncertain commercial outcomes. In recent years, private venture capital has increasingly favored quicker returns, leaving many hard-tech firms underfunded or overly dependent on government subsidies. By injecting large pools of patient capital, authorities aim to stabilize funding conditions, support sustained research and development, and help promising firms survive the so-called “valley of death” between laboratory breakthroughs and commercial viability.
The emphasis on early-stage investment suggests policymakers want to influence innovation at its roots, shaping technology trajectories before companies become large or strategically constrained. Officials have previously said similar state-backed funds would be run on more market-oriented principles, balancing commercial discipline with national strategic objectives, though details on governance, fund managers, and expected investment horizons have not yet been disclosed.
The initiative also fits into a broader recalibration of China’s economic model. As the property sector downturn weighs on growth and traditional investment engines lose momentum, Beijing has repeatedly framed advanced manufacturing and frontier technologies as the foundation of “high-quality development.” Large-scale funds such as these are intended to crowd in private capital, signal long-term policy commitment, and anchor innovation-led growth.
While questions remain about execution, returns, and the risk of misallocation, analysts say the sheer size and focus of the funds send a clear message: China is doubling down on hard technology as a central pillar of its future economy. If effectively deployed, the capital could accelerate breakthroughs in core technologies, especially semiconductor, reshape the country’s startup landscape, and deepen the state’s role as a long-term venture investor in strategically vital industries.
