Zhongguancun Development Group (ZDG), a Chinese state-owned venture capital fund, has partnered the city of Ottawa to launch an incubator program to support and attract its technology startups to expand in China.
The technology incubation center will be the second in North America after the launch of a similar center in Silicon Valley last year, according to a press release Tuesday.
The partnership between government agency Invest Ottawa and ZDG is named the ZDG Ottawa International Incubation Centre, and will have an initial US$10 million capital.
"Ottawa is one of the major innovation centres in the world," said Qiang Xu, general manager of ZDG. He added the Canadian agency's many years of "good cooperation relationship" was another factor for choosing Ottawa.
The tech incubator will provide funding and support to Ottawa-based technology startups wishing to enter the rapidly growing Chinese market, noted the press release. It added potential startups will be identified by Invest Ottawa while the center will help finance China-based research and development, marketing and office expansion.
"This market expansion capital is very welcome, and our expectation is that our China-focused companies will prove themselves quickly and attract even greater investment and opportunity in the years to come," said Invest Ottawa CEO Bruce Lazenby.
ZDG has plans to invest up to US$1.5 billion over the next five years in technology companies, and has so far funded more than 80 companies and projects since its establishment in 2010.
It has a registered capital base of US$1.9 billion with total assets of $11 billion, and is located in the Zhongguancun Innovation Park (Zpark)--China's version of Silicon Valley.
Besides Ottawa and Silicon Valley, ZDG's third overseas incubation center is in Finland. ZDG's plans to attract overseas startups to China will potentially help create more jobs and technology spinoffs there.