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The Chinafornia Newsletter 4.26.18 - Is Chinese VC in Silicon Valley a Threat?

April 26 · Issue #45 · View online
Matt Sheehan's Newsletter
Welcome to the 45th edition of The Chinafornia Newsletter, your digest of news connecting the Golden State and the Middle Kingdom.
This week we’ve got a good mix of stories covering the tech Cold War, CCP influence on US campuses, and patriotic (jingoistic?) Chinese blockbusters.
I also just published a new piece for MacroPolo: Is Chinese Venture Capital in Silicon Valley a Threat? In it I dissect the “DIUx Report,” a little-discussed but highly influential paper on Chinese VC investment that has helped inspire legislation that would bring CFIUS oversight to VC investments. While the DIUx report was prescient on aspects of China’s tech transfer regime, I argue that it fundamentally misrepresents lots of “Chinese” investors and could be really damaging to US startups – though not in the way often discussed. Give it a read and let me know what you think.
And a little personal news: I’m going to be spending almost all of May and June in Washington DC, so if you’re in that area and want to chat, hit me up by email (see below). I’m going to be in a dead sprint to finish the manuscript of my book on Chinafornia, but also would love to meet folks from the China community out there.
This week’s top reads:
3. Red Dynamite - LARB China Channel (on China’s military blockbusters)
The Chinafornia Newsletter is created by me, Matt Sheehan. I’m a fellow at The Paulson Institute and write for the think tank’s site MacroPolo. I spent over five years in mainland China, including two as the first-ever China correspondent for The Huffington Post and The WorldPost. I’m now back in my native California where I’m consulting on market entry and communications for China-related projects, and writing a book on Chinafornia.
You can read some of my best work on my own website: An Optimist’s Guide to China. Follow me on Twitter @mattsheehan88 and feel free to email me at

Does Chinese Venture Capital in Silicon Valley Threaten US Tech Advantage? - MacroPolo
U.S. probing Huawei for possible Iran sanctions violations: sources | Reuters
The New Global Order in Ride Hailing: Didi vs. Uber — The Information
Nathan Blecharczyk on Lessons from Airbnb’s China Expansion | 996 Podcast with GGV Capital | SupChina
Y Combinator is officially coming to China · TechNode
Finally, Zuckerberg’s congressional testimony is old news by now, but I wanted to highlight two Chinafornia moments amidst the media circus:
- The first came when a  senator asks Zuckerberg if Facebook is an “only in America” story. Zuckerberg answers that “there are some very strong internet companies in China,” and the senator jokingly tells him that this was a softball: “You’re supposed to answer ‘yes’ to this question.”
- The second came when a photographer captured the prep notes Zuckerberg had in front of him, including the point that   “US tech companies key asset for America; break up strengthens Chinese companies.”
U.S. Questions Cosco’s Takeover of Cargo Terminal in Long Beach - WSJ
Chinese investment in U.S. plunges, with big implications for California - San Francisco Chronicle
Red Dynamite – China Channel
China’s largest movie studio is vast, and so is its audience. But filmmakers have to toe the party line
Tang Media Pacts With Tencent to Buy Hollywood Movies For China – Variety
Hollywood Blockbusters Do Better in China Than U.S. in Recent Weeks
The Chinese Communist Party Is Setting Up Cells at Universities Across America – Foreign Policy
Texas A&M cuts ties with Confucius Institutes in response to congressmen's concerns
Chinese students under mental pressure overseas - Global Times
Real Estate
US developers feel pinch as visa-seeking Chinese pull back on investments - Inkstone
Antonio Villaraigosa made $318K in paid speeches
CHP-194-The History of Toi San and US Immigration – Teacup Media
Jobs and Events
The People’s Republic of Desire | CAAMFest2018
Culture Corner
红豆 Red Bean - Northwestern Treblemakers
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