China’s private capital fundraising sinks to record low of US$3.4 billion on poor outlook
- The second quarter fundraising came in at US$3.4 billion, less than a tenth of the average US$45 billion raised each quarter between 2019 and 2021
China-focused private capital fundraising tumbled to a new low of US$3.4 billion in the second quarter as investors turned their backs on the world’s second-largest economy, citing economic headwinds and exit uncertainties, according to data provider Preqin.
The latest tally was less than a tenth of the average quarterly amount of US$45 billion between 2019 and 2021 as geopolitical tensions, weak market performances and liquidity constraints weighed on investor sentiment towards China, Angela Lai, lead author of Preqin’s Asia-Pacific (APAC) quarterly report published on Wednesday, said in an interview.
The asset classes covered include private equity, venture capital, private debt, real estate and infrastructure.
“China-focused funds are still having a very challenging time,” said Lai, who is also the head of APAC for valuations and research insights at Preqin. “We are talking about coming down from such a high level … it’s almost like there is a limited downside you can go further from here.”
Total private capital raised for China dropped consecutively for four quarters after a slight uptick to US$10 billion in the second quarter of last year, according to Preqin.
