AsianFin -- Source Code Capital, one of the earliest investors in TikTok owner ByteDance Ltd., is cutting its fundraising goal by half to approximately $150 million due to weaker-than-expected investor interest, according to people familiar with the matter.
The Beijing-based firm initially aimed to raise $300 million for a new U.S. dollar-denominated fund led by partner Samuel Huang but is now scaling back its target, the sources said, requesting anonymity as the discussions are private.
This marks a setback for Source Code, which has not launched a major investment vehicle since early 2021. However, the fundraising target remains tentative and could still change, the sources added.
The firm’s fundraising efforts are being closely watched as an indicator of investor confidence in China’s tech sector. A regulatory crackdown and an ongoing economic downturn have significantly dampened venture capital activity in the country since the pre-Covid era, when both U.S. and domestic investors poured funds into sectors ranging from dating apps to grocery delivery platforms.
In 2024, China-based U.S. dollar venture capital funds raised $1.3 billion across 11 funds, representing 28% of the total capital raised in the Asia-Pacific region, according to Preqin. In contrast, 62 funds secured $17.2 billion in 2021, accounting for 60% of the region’s total.
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