PE-VC fundraising by Greater China startups returns to growth lane in Q3

Fundraising by Greater China-based private companies returned to the growth lane in Q3 2021, after a dip in the previous quarter.

Private equity (PE) and venture capital (VC) investors poured atleast $23.1 billion across 551 deals in July-September 2021, showed data from our latest DATA VANTAGE report Greater China Deal Review: Q3 2021.

In the three-month period, there were 69 megadeals — or transactions worth atleast $100 million — including one deal worth over $1 billion.

In comparison, Greater China-based startups had raised $17 billion in April-June. This included 47 megdeals but no billion-dollar deals.

Compared with a year ago, deal value in Q3 rose 61.6% year-on-year, while deal count increased 55.6%.

The fundraising was underpinned by the higher number of megadeals in Q3. The 69 megadeals in the September quarter collectively amassed nearly $15.2 billion, or 65.7% of the total fundraising.

The biggest deal was the $1.6 billion Series B raised by electric vehicle (EV) battery maker SVOLT Energy Technology led by Bank of China Group Investment in July.

Five companies raised funds between $500 million and $1 billion: COVID-19 vaccine developer Suzhou Abogen Biosciences ($700 million); EV startup Leapmotor ($692 million); ride-hailing firm Caocao Mobility ($600 million); semiconductor wafers maker FerroTec ($511 million); and EV brand Zeekr Intelligent Technology ($500 million).

Biotech tops deal count

Biotech was the most active sector in Q3 in terms of deal count, displacing software from the top position. As many as 68 deals were sealed by biotech startups in the quarter raising $3.1 billion. The biggest biotech transaciton was Suzhou Abogen Biosciences’s $700 million Series C led by Singapore’s Temasek and Hillhouse-backed GL Ventures, among others.

“Now is an unprecedented era for China’s biotech industry to take off — not only from the capital markets’ perspective, but also from the perspective of China’s overall healthcare enhancement in terms of per capita spending, available healthcare services, regulatory support, as well as a healthcare talent pool that has grown over the years,” said Christina Bao, managing director, HKEX.

Overall, health-related companies secured 30.1% of the funds raised in Q3.

Investors also showed a preference for autos & parts as it became the top-funded sector with $3.77 billion raised across 33 deals. The biggest deal in this space was the $692 million strategic investment in Leapmotor led by CICC Capital.

IPO landscape

In terms of public market activity (IPOs), Greater China-based firms raised $107.4 billion in January-September, an increase of 24% year on year. This period witnessed 483 listings, up 19% over last year.

However, IPO activity moderated in the third quarter, with $34.2 billion raised by 156 companies, compared with $40 billion raised in Q2 by 176 companies. The IPO funds raised in the September quarter is a roughly 35% fall from the highs of Q3 2020, when COVID-related restrictions were eased.

Beijing’s call for ride-hailing firm Didi to delist in the US, and uncertainties surrounding listing regulations in the US for Greater China companies, point to hurdles for tech firms aspiring to tap the US capital markets.

“There is a diversion of capital that would have otherwise gone into China, now interested in going elsewhere… with Singapore and SE Asia at the top of their minds. There are still plenty of opportunities in China. It’s just that… there are opportunities elsewhere [that] really present themselves better,” said James Tan, managing partner, Quest Ventures.


The Greater China Deal Review: Q3 2021 report covers fundraising by startups in the region in the third quarter, with extensive data on:

  • Top PE-VC deals of Q3 2021
  • Top sectors that attracted investors
  • Top IPOs by Greater China-based companies, and
  • Insights from prominent investors

The report is available exclusively to DealStreetAsia – Research & Analytics subscribers. Subscribe/upgrade your subscription now to access our entire set of reports. Still not sure? Opt for a one-month trial for only $199.

Singapore Reporter/s

In Singapore, we are looking to double our reporting team by this year-end to comprehensively cover the fast-moving world of funded startups and VC, PE & M&A deals. We want reporters who can tell our readers what is really happening in these sectors and why it matters to markets, companies and consumers. The ability to write precisely and urgently is crucial for these roles. Ideal candidates must have to ability to work in a collaborative, dynamic, and fast-changing environment. We want our new hires to be digitally savvy and ready to experiment with new forms of storytelling. Most importantly, we are looking for hard-hitting reporters who work well in a team. Collaboration and collegiality are a must.

Following vacancies can be applied for (only in Singapore).

Following vacancies can be applied for (only in Singapore).   

  • A reporter to track companies/startups that have raised private capital, and have the potential to become unicorns. SEA currently has over 40 companies with a valuation of over $100 million and under $1 billion.
  • A reporter who can get behind the scenes and reveal how funding rounds are put together, or why they’ve failed to materialise. She/he in this role will largely focus on long-format stories. 
  • A journalist to track special situations funds, distressed debt and private credit (from the PE angle) across Asia.

Singapore Reporter/s

In Singapore, we are looking to double our reporting team by this year-end to comprehensively cover the fast-moving world of funded startups and VC, PE & M&A deals. We want reporters who can tell our readers what is really happening in these sectors and why it matters to markets, companies and consumers. The ability to write precisely and urgently is crucial for these roles. Ideal candidates must have to ability to work in a collaborative, dynamic, and fast-changing environment. We want our new hires to be digitally savvy and ready to experiment with new forms of storytelling. Most importantly, we are looking for hard-hitting reporters who work well in a team. Collaboration and collegiality are a must.

Following vacancies can be applied for (only in Singapore).

Following vacancies can be applied for (only in Singapore).   

  • A reporter to track companies/startups that have raised private capital, and have the potential to become unicorns. SEA currently has over 40 companies with a valuation of over $100 million and under $1 billion.
  • A reporter who can get behind the scenes and reveal how funding rounds are put together, or why they’ve failed to materialise. She/he in this role will largely focus on long-format stories. 
  • A journalist to track special situations funds, distressed debt and private credit (from the PE angle) across Asia.