New VC fund to focus on Pudong

A new government-backed investment fund worth up to US$293 million will be launched in Shanghai’s Pudong New Area at the end of the year to fund fast-growing areas such as IT, modernized manufacturing and new energy, state media reported. The fund, created by the government-backed Shanghai Pudong Science and Technology Investment Co, will be managed by Softbank China Venture Capital, a mainland unit of Japan’s Softbank Corp. Venture capitalists invested US$363 million on the mainland in October, 16.7% less than the same month in 2007. Industry sources said periods of slower economic growth were good times for venture capital investment due to low valuations and greater choice in the market.