China’s Socially contributed & Centraly Accumulated Capitalism & Crisis!
The Party capitalists
China’s Communist authorities reinvent state capitalism
Their shareholdings in tech firms and other private companies are soaring
IT MIGHT BE confused for one of the world’s savviest tech investors. The portfolio of China Internet Investment Fund (CIIF) is the envy of venture capitalists everywhere. It owns part of ByteDance, the Beijing-based parent of social media group TikTok, and Weibo, the Twitter-like platform. It has a stake in SenseTime, one of China’s most advanced artificial intelligence (AI) groups, and Kuaishou, a popular Chinese short-video service. The firm’s investment list reads like a who’s who of the industry.
More stunning are the terms of these investment deals. CIIF’s 1% stake in a ByteDance subsidary gives it the power to appoint one of three board members in a unit that holds key licences for operating its domestic short-video business. A similar bargain has been struck with Weibo, which is listed in New York, with CIIF picking up 1% at a cost of just 10.7m yuan ($1.5m). These companies hardly need more capital. Nor is CIIF , armed with plans for a 100bn yuan fund—enough to rival a major Silicon Valley venture-capital firm—overly concerned with the outsize returns its investments will almost certainly deliver.
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