A bipartisan congressional investigation has found that US venture capital firms invested billions in Chinese technology companies in semiconductor, AI, and cybersecurity, sectors that threaten US national security. According to a report released on 08 February 2024 by the House Select Committee on China, five prominent venture firms, GGV Capital, GSR Ventures, Qualcomm Ventures, Sequoia Capital, and Walden International, invested in hundreds of Chinese companies that directly or indirectly support Beijing’s military and surveillance state.[1]
“[These venture capital firms] funneled over $1.9 billion to AI companies that support China’s human rights abuses or military, and at least another $1.2 billion into the PRC’s semiconductor sector– including semiconductor companies that advance the CCP’s military, genocidal, and techno-totalitarian ambitions,” the report said. “The status quo is untenable,” the committee wrote. “In certain cases, the lawmakers even uncovered internal VC memorandums stating that Chinese investments were more attractive if the company supported the Chinese government’s surveillance state or its strategy for technological supremacy, designed to weaken the United States.”
In the cybersecurity sector, the report pinpoints Sequoia Capital’s $48 million position in Qihoo360, described as a “military-civilian PRC enterprise focused on cybersecurity that the Commerce Department and Defense Department have blacklisted.” The congressional report also highlighted Sequoia Capital’s investment in EverSec, a cybersecurity startup linked to the Chinese military. The report said EverSec serves as a “Cybersecurity Emergency Service Support Unit” for the PRC government and has contracted with the PLA to develop an AI-enabled “cyber threat intelligent sensing and early warning platform.”
In addition, the investigators noted that EverSec won a bid in 2019 for a malware-related cyber project from the PLA’s Strategic Support Force and a data platform software-related bid for the PLA Air Force in 2020.
This article is presented at no charge for educational and informational purposes only.
Red Sky Alliance is a Cyber Threat Analysis and Intelligence Service organization. Call for assistance. For questions, comments, a demo, or assistance, please get in touch with the office directly at 1-844-492-7225 or feedback@redskyalliance.com
Reporting: https://www.redskyalliance.org/
Website: https://www.redskyalliance.com/
LinkedIn: https://www.linkedin.com/company/64265941
Weekly Cyber Intelligence Briefings:
REDSHORTS - Weekly Cyber Intelligence Briefings
https://attendee.gotowebinar.com/register/5993554863383553632
[1] https://www.securityweek.com/lawmakers-want-clampdown-on-american-vcs-funding-chinese-tech-companies/
Comments