Chinese funds plow cash into British VC shops

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The agreements stand to increase the capital and opportunities available to some British biotechs. (daderot)

Chinese investors are set to pump money into two British funds. The agreements stand to create investment vehicles with more than $1 billion (€810 million) under management and an interest in bringing British innovations to China.

Eight Great Technologies Fund (8GT) and Future Planet Capital (FPC) are the two British investment funds involved in the financings. Neither fund is focused squarely on life sciences; the structure of the agreements means not all the cash will go directly into U.K. startups and the commitments are yet to be firmed up into legally binding promises. That said, the financings still stand to increase the capital and opportunities available to some British biotechs.

The money is the result of a series of memorandums of understanding struck by 8GT, FPC and groups in China. 8GT, a fund that invests some of its cash in regenerative medicines, set up a $775 million fund with the VC wing of Tsinghua University. Some of the cash will go to British startups. The rest will support work to bring British innovations to China through joint ventures and other mechanisms. 8GT is also involved with a second, $165 million fund focused on the Chinese province of Jiangsu.

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8GT and FPC are both involved in the other large Anglo-Chinese agreement. That agreement is set to make $470 million of Shenzen Qian Hai Sunflower Financial Services' and Jian Xin Tian Ran Investment Management’s money available to British and Chinese healthcare and biotech companies. FPC has separately secured $200 million from TW & Partners for its inaugural fund. 

FPC lists health as one of five areas in which it invests. Similarly, 8GT invests in regenerative medicine and synthetic biology alongside six other areas far removed from life sciences, such as satellites and energy storage.

The companies entered into memorandums of understanding with Chinese investors while British Prime Minister Theresa May was in China. May went to China in the hopes of tightening the U.K.’s ties to a country that could be key to attempts to weather the potential loss of trade from leaving the European Union.