Coastal city earns attention of venture capital investment

Qingdao in Shandong province has attracted a number of high-quality venture capital projects and grown into a new highland for venture capital investment in recent years, local officials said.

Zhao Haozhi, mayor of Qingdao, said the city will develop its real economy, promote technological innovation, accelerate its digital transformation and create a strong business environment for the development of venture capital firms.

"Venture capital has now become a distinctive city brand in Qingdao," said Sheng Xitai, veteran banker and co-founder of investment fund Hongtai Aplus.

He said Qingdao has seized the opportunity to boost venture capital investment and built industrial chains in information technology, professionals and capital.

As of the first quarter of this year, Qingdao had registered 387 private equity fund managers with the Asset Management Association of China, the growth rate of which ranks first in the country. The number of managed funds is 1,063, an increase of 76.6 percent year-on-year, and the growth rate ranks second in the country.

Hu Jiafu, vice-chairman of AMAC, said Qingdao has achieved remarkable results in building a venture capital center, creating a city of entrepreneurship and industrial internet.

"I believe Qingdao will definitely lead the new trend of innovation and entrepreneurship in the hot land of venture capital funds."

On May 7, the 2021 Qingdao Global Venture Capital Conference attracted more than 100 big names in investment and business.

Lu Dabiao, deputy general manager of the Shanghai Stock Exchange, said Qingdao has become a new highland for the agglomeration of innovative capital.

"The accumulation of various high-quality fund resources is accelerating industry cultivation, talent accumulation, and technological upgrading," he said. "The emerging industries have provided strong momentum for accelerating the development of emerging industries."

Qingdao has introduced 100 emerging projects through venture capital institutions including the Shifang Sunac Venture Capital Center, Qingsong Fund and Echo Capital.

The 2021 Qingdao Global Venture Capital Conference served as a platform to attract venture capital projects and promote trade relations.

At the conference, 28 key projects were signed with a total investment of 61.69 billion yuan ($9.6 billion).

One key project was CITIC Trust's Qualified Domestic Limited Partnership, or QDLP, pilot fund in Qingdao's Laoshan district.

The project is expected to meet the cross-border investment needs of market entities and further boost development of the Jinjialing Financial District, the core area of Qingdao's financial industry.

Under the integrated development of the Jiaodong Economic Circle, five cities in Shandong signed strategic agreements with Zhongtai Securities to promote the interaction of industries through capital.

The conference also released "10 guidelines for venture capital in Qingdao", which has optimized the market environment as well as the competitive policies in global venture capital.

Sui Xiao, chairman of Qingsong Fund, said the new policy encourages investment institutions to invest in projects early.

"The government offers risk compensation and this is a very valuable measure," Sui said.

"It can encourage more institutions to invest in Qingdao's mid-and early-stage projects, and further develop the city's science and technology ecology."

In addition, Qingdao will unblock capital flow channels, optimize the review process, and promote Qualified Foreign Limited Partnership and QDLP.

The city will also explore and found regional capital alliances and continue to support the standardized, healthy and high-quality development of private equity funds.

At the same time, Qingdao is working hard to develop the real economy to facilitate venture capital investment.

The city is focusing on new economic industries such as a new generation of IT, new energy, new materials, high-end equipment and artificial intelligence.

The benign interaction between technological innovation and capital development is also an important advantage for attracting venture capital.

Qingdao has a number of high-end research and development platforms such as the National High-speed Train Technology Innovation Center, 52 key laboratories above the provincial level, 188 engineering research centers above the provincial level, and 202 enterprise technology centers above the provincial level. These innovation platforms implement a batch of scientific and technological projects every year, and give birth to a batch of scientific and technological achievements.