Quarter of top global VCs investing in China, India

Asian giants show growing importance as funding hotspots by accounting for 17 percent of all venture capital invested--a growing proportion to United States' 70 percent, report states.
Written by Ellyne Phneah, Contributor

One-quarter of the top 100 venture capitalists (VCs) in Forbes' Midas List 2012 are now investing in China and India.

According to Forbes' annual list of best dealmakers in technology and life science industry, which was released last Friday, the inclusion of China and India markets in the formulation of the list for the first time showed that more prominent VCs are going beyond their usual market portfolio of Europe, Israel and the United States, to make their presence felt in these two Asian economic powerhouses.

Of the top 100 venture capitalists that were ranked in the 2012 list but were not on last year's list, 12 have China deals, while two more venture capitalists have funded at least one India startup. China and India also accounted for 17 percent of the total venture capital invested, and are continuing to grow in relation to the U.S., which garnered 70 percent of total investments.

Companies such as DCM and IDG Accel had boosted rankings in this year's list because of their China portfolio, while Accel India and Mayfield Fund can thank their India-based deals for their elevated positions too, the report noted.

Notable Chinese companies that have received funding support from these venture capitalist firms include social media company Renren, video streaming service provider Tudou, and outsourcing company HiSoft, Forbes stated. Online retailer Flipkart, travel service MakeMyTrip, and medical device maker Perfin helped fly India's flag, it added.

"This year's list reflects the importance of China and India as emerging hotspots of technology innovation," the report said. "The 2012 rankings highlight the trend of Silicon Valley dealmakers that have gotten on the fast track to China and India."

Not everyone shared similar sentiments with the 25 percent of top 100 VCs though. Stuart O'Gorman, director of technology equities at Henderson Global Investors, said earlier that Asian tech firms make for poor long-term investments due to the highly competitive regional market, poor performance track records, and cost pressures from rising wages and intellectual property disputes.

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