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China tech

Chinese tech fundraising under pressure amid market turmoil

Investors expect slower and smaller IPO launches as valuations shrink

An electronic board shows top active securities in Hong Kong. The uncertainty over Tencent's streaming music business IPO illustrates Chinese tech companies' recent fundraising difficulties.   © Reuters

HONG KONG -- Chinese tech startups will face mounting challenges in raising funds as risk money retreats in response to recent market turmoil, investors and advisers say.

This reversal is encapsulated in the performance of internet group Tencent Holdings, whose WeChat app and online games are used by hundreds of millions of Chinese consumers. The onetime superstar in the Hong Kong stock market has seen its share price tumble 40% since January, wiping out more than $200 billion in market value. Tencent was a casualty, along with others, of last week's global equity market sell-off.

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