Beijing, 10 September 2024 (TDI): China’s integrated circuit (IC) sector has become the top breeding ground for unicorns, surpassing all other industries in the country over the past three years, according to a recent report.
Despite increasing financial pressures on local start-ups, the IC industry has continued to thrive.
The China Unicorn Enterprise Development Tracking Report, released on Sunday by Great Wall Strategy Consultants, reveals that the number of newly funded unicorns—start-ups valued at over US$1 billion—declined from a high of 192 in 2021 to 137 in 2022, and further to 106 last year.
This decline reflects broader challenges in fundraising for start-ups.
Even as total funding has decreased, start-ups that secured investment received larger average amounts.
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Notably, funding from renminbi sources has become more prevalent, with US-dollar funds dropping to 28 percent of all deals last year, compared to 35.5 percent in 2022 and 50 percent in 2021.
The report highlights that a significant portion of the investment has flowed into hard tech sectors, including ICs and new energy vehicles.
China’s Push Towards Technological Self-reliance
This aligns with China’s strategic push towards technological self-reliance, particularly in reducing dependency on foreign technologies from the US.
The Yangtze River Delta, a key semiconductor production hub, accounted for 40 percent of all Chinese unicorns in 2023.
The trend indicates a shift, with more unicorns emerging outside of China’s first-tier cities such as Beijing, Shanghai, Shenzhen, Guangzhou, and Hangzhou.
