Silicon Valley gets queasy about Chinese money

BUYER’S remorse is often experienced in Silicon Valley by investors who plough money into risky startups only to see them fail. Some technology entrepreneurs are now suffering from seller’s remorse. They are those whose young companies have grown big in part thanks to Chinese financial backing, but now feel under scrutiny because of an escalating fight between the two tech superpowers.

One entrepreneur who took money from Danhua Capital, a Chinese venture-capital firm based near Stanford University, for example, only recently learned that the firm was established with help and funding from China’s government. “You’re going in blind. If there are issues down the line you may not know who you’re dealing with,” he laments.

FIRRMA treatment

In coming days President Donald Trump is expected to sign into effect the Foreign Investment Risk Review Modernisation Act (FIRRMA), which establishes more vigilant reviews of foreign investments into American companies,…

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