Chinese-backed Cocoon Networks has launched a £500 million (approximately $715 million USD) venture capital fund to spur UK and European tech startups in China. The technology and investment group, which is backed by China Equity Group and Hanxin Capital, will seek out products and service with potential for growth in the Chinese market.
Cocoon Networks’ was launched in 2015, and held its first event in November. The services it provides include an accelerator program, investment, intellectual property management, and collaborative and test lab spaces in a 70,000 square foot incubator in London’s Tech City. Dozens of Chinese companies have announced investments in the London area over the past year, according to the announcement.
“The fund will provide capital to help the development of some excellent technology and innovative projects in London and the UK,” said John Zai, Founder and CEO, Cocoon Networks. “The fund and incubator programme will bring awareness for more Chinese investors to get into London’s booming technology sector. It will also help many companies grow and expand into China.”
Chinese Equity Group was one of the first investors in Chinese search giant Baidu. Baidu and CloudFlare announced a partnership in September to deliver acceleration and security to Chinese enterprises on the web, in a deal typical of the international give-and-take necessary for non-Chinese companies to access the enormous and largely consolidated market.
Although protectionist and restrictive regulations and concerns about legal and security footing combine to make things difficult for many companies seeking to do business in China, investments and service partnerships are constantly being announced, headlined by the $125 billion Dell-Kingsoft deal in September.