On the ground in China: notes from an investor tour of Beijing and Shenzhen

In November 2025 I spent a study week in Beijing and Shenzhen on an immersive investor tour organised by Danchun Chen, meeting leading founders, operators and VCs across AI, robotics, semiconductors and biotech. A few impressions and takeaways.

Ambition, scale and pace

The ambition, scale and pace of innovation in China far exceed what we see in Europe. Nowhere is this clearer than in Shenzhen, where "Shenzhen speed" is a point of pride, visible in the skyscrapers going up and the robots rolling off factory lines. The sheer number of outstanding engineers and a very different approach to work-life balance underpin all of this.

Density as superpower, and maybe kryptonite

Shenzhen's superpower is its density: the entire hardware and robotics supply chain is concentrated less than an hour away. But it might also be its kryptonite. This proximity may be fuelling a robotics bubble: hundreds of companies are building humanoids and complex robots while neither the market nor the technology is truly ready. (Our Venture Partner Robert MacKenzie makes the same argument from the product side in Beyond Robotics Complexity.)

From manufacturing optimisation to product innovation

China has clearly evolved from optimising manufacturing to product innovation. We met global leaders across robotics (Hai Robotics), foundation models (Kimi AI, MiniMax), semiconductors (Innoscience), biotech and self-driving technology (Horizon Robotics). Innovation is not limited to startups either: Tencent's research and product line-up rivals, and in some areas surpasses, Alphabet's.

China's exceptionally dense megacities create a distinctive competitive edge. With tens of thousands of people concentrated within a few blocks, consumer-focused innovations are a VC-worthy opportunity, and consumer services gather data at unprecedented scale. The result: both physical retail and digital AI solutions are attracting substantial capital and advancing rapidly, outpacing other markets globally.

The VCs

I was impressed by the VCs we met. Like the companies they back, these firms are expanding beyond China to diaspora and global markets: ambitious, hands-on and laser-focused on building global leaders. Funds are mature, with hundreds of millions to billions under management, many with USD funds and US- or Europe-based LPs. A few that stood out: Capital Today Group, whose founder Kathy Xu is one of the most impressive GPs I have met, deeply knowledgeable across sectors, articulate and opinionated; Hui Capital, founded by BYD co-founder Yang Longzhong and deeply integrated in China's industrial ecosystem; and BioTrack Capital, founded by ex-Sequoia China partner Kevin (Penghui) Chen and specialising in biotech, whose portfolio CEOs are determined to become global leaders at the forefront of drug R&D.

Final thought: AI versus China

China is capitalising on its numbers and work ethic, a huge advantage when engineering and manufacturing are done by humans. But as AI agents and robotics take over, will China lose its edge to its own creations, or will its head start in robotics create an even larger moat?

Originally shared on LinkedIn and in our December 2025 newsletter.