Tsinghua Holdings Ltd (清華控股) is to invest 50 billion yuan (US$7.6 billion) in research over five years and set up a fund to help commercialize scientific discoveries, company chairman Xu Jinghong (徐井宏) said in an interview.
The company, a Chinese state-owned enterprise that was founded in 2003 by Chinese President Xi Jinping’s (習近平) alma mater, Tsinghua University (清華大學), began two projects on Sunday.
One focuses on helping start-ups and the other on commercializing scientific findings, Xu said at the World Economic Forum in Tianjin, China.
The firm is to set up 1,000 business incubators in China by 2021 and another 50 in nations including the US, the UK and Germany, Xu said.
The size of a parent fund, which invests in other funds that put money into start-ups, is to exceed 20 billion yuan in the next five years, he said.
“Our goal is to cultivate 500 start-ups that are valued at more than 100 million yuan within the next five years,” said Xu, who is a Tsinghua alumnus.
“China is still lagging in terms of indigenous and core technologies, and there needs to be some companies to act as pioneers and push ahead with innovation,” he added.
Tsinghua Holdings is to set up a 10 billion yuan fund linked to scientific discoveries, he said.
The company’s efforts come as Chinese Premier Li Keqiang (李克強) calls for innovation, and after the nation’s campaign to encourage entrepreneurship helped create tens of thousands of small firms since 2014.
China is seeking new engines of growth after economic expansion cooled to the slowest pace in more than a quarter-century.
However, bureaucracy, the dominance of large state-backed firms and lax intellectual-property protection could hinder an entrepreneurial culture.
“We have no doubts that we will make a profit” on the project that helps start-ups, as almost all of Tsinghua’s existing incubators are profitable, Xu said.
The firm might need a “longer time” for its investments in scientific findings to make money, he added.
Tsinghua’s parent fund has invested in 50 smaller funds that put money in start-ups, Xu said, adding that the company would be interested in small firms with their own technologies, but would also touch on culture and Internet start-up.
Tsinghua Holdings is to focus on industries it is familiar with when it explores overseas markets through acquisitions, while the firm is to continue to expand in the integrated circuits industry, and is to “take new steps” in environmental protection, new energy and materials, Xu said.
“The level of internationalization for the company is very, very low,” he said.
The company’s goal is for overseas business to account for 30 percent of its revenue “in several years,” up from about 5 percent now, he added.
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