The pace of billion-dollar startup creation slowed markedly in China in 2018’s final quarter as the country’s largest tech startups shored up their dominance and the economy decelerated.
China spawned 97 unicorns last year with a combined valuation of 1.2 trillion yuan ($178 billion) across sectors from consumer internet to online shopping and electric vehicles, according to a report published by consultancy Hurun. That’s about one unicorn born every 3.8 days. But of those, 11 were created in the December quarter, down from more than 30 in the previous three months.
Tech startup investment is slowing as stretched valuations and the economy takes a toll. Beijing, wary of financial risk, is cracking down on internet loan providers and the crypto-currency market is sputtering as prices deflate. Alibaba Group Holding Ltd. Vice Chairman Joseph Tsai warned last week that valuations were “distorted” and may decline over the coming six to nine months, particularly in over-heated arenas such as bike-sharing.