Tech investors face new era of China restrictions after Biden order limits funding in A.I., chips
Summary
Biden is specifically targeting investments in technologies like semiconductors, quantum computing and artificial intelligence on concern that Chinas advancements in those areas run counter to U.S. national security interests. Combined U.S. private equity and venture investments in China fell to an eight-year low in 2022 in terms of capital deployed, a trend that continued into the first half of this year, according to PitchBook data. "U.S. money should not be used to finance Beijings military development," said Eric Reiner, managing partner at Vine Ventures, which backs early-stage companies in the U.S., Israel and Latin America. "Its likely to deter investments in those sectors, even beyond what is explicitly prohibited," said, Adam Hickey, a former deputy assistant attorney general for the Justice Departments national security division whos now a partner at law firm Mayer Brown. For example, major U.S. venture firms have invested in ByteDance, the parent of mobile video app TikTok, which has faced the threat of a potential ban in the U.S. or a forced sale to keep operating.