Regardless of motives, a secondary benefit the U.S. stands to gain from China is the sudden capital injections from China’s major technology firms, including Tencent and Alibaba. U.S. startups are suddenly Chinese M&A targets. In fact, Chinese firms have invested in U.S. tech companies to the tune of $6 billion in 2014 (so far), according to the Rhodium Group.
For instance, Snapchat, Fab, Plain Vanilla (famed for QuizUp), and Whisper are just a few of Tencent’s 15 deals in U.S. tech firms in the last three years. Alibaba in parallel has been on a spending spree of late in preparation for its IPO with seven acquisitions and investments in U.S. startups (one of which includes messaging app Tango) since 2013.
And don’t forget that IBM recently sold off its x86 server manufacturing arm to Chinese hardware manufacturer Lenovo, which, in the past, has purchased and turned around IBM’s ailing PC business into the largest PC company in the world. Lenovo also recently purchased Motorola.