It turns out that investors in the Silicon Valley are worried about the progress being made by China’s tech sector with many concerned that the emerging new technology power could soon overtake US in areas like AI and autonomous vehicles.
The notion of the Chinese tech sector leaving the US behind came up at a Bay Area debate earlier this week when Sequoia Capital venture partner Mike Vernal posited that China could overtake US in some emerging technologies. Speaking at an event hosted by The Churchill Club, Vernal said that the Chinese tech sector being pushed by the Chinese Government is making huge progress and that the Silicon Valley needs to wake up and realize this.
In China, the government is eager to clear hurdles for self-driving cars, data sharing, or factory automation, while start-ups in the U.S. get caught up in regulation, Vernal said.
Chinese start-ups relating to artificial intelligence are already attracting more funding: They received 48 percent of global AI funding versus 38 percent in the U.S., according to CB Insights.
The four other investors on stage — David Cowan from Bessemer, Sarah Guo from Greylock, Nicole Quinn from Lightspeed and Tomasz Tunguz from Redpoint — largely agreed with Vernal’s prediction.
Not only is the Chinese government more aligned with the country’s tech sector, but start-ups there have access to much larger data sets to train their AI algorithms, due to both the size of the population and fewer concerns or regulations around privacy, added Tunguz.
Each investor had to present two technology trends that they thought would take off in three to five years and this was one of Vernal’s pitches:
The only investor who didn’t agree with Vernal’s prediction was Cowan, who argued that technology isn’t a winner-take-all situation and that innovation in China will benefit economies and consumers everywhere.
One way that Silicon Valley could maintain its status as a global innovation hub is to continue to make it a place where people from all around the world want to work, Guo added.