China's tech industry has become one of world's largest with increasing number of foreign companies expanding services to the Chinese market and domestic tech start-ups pushing their products abroad. With more investors willing to help make Chinese start-ups become billion dollar companies, CGTN's Ren Xueqian takes a closer look at what's fueling these ventures.  

According to data intelligence platform CB Insights, the number of Chinese tech start-ups valued at 1 billion US dollars or more have increased from merely 8 in 2014 to 56 in 2017, surpassing that in Europe and the US in terms of growth.

Now, it's only a matter of time before high-profile, foreign incubators like California-based Y Combinator, or YC, ventures into the Chinese startup scene.

With their first YC Startup School program at Beijing's Tsinghua University, the company aims to inspire Chinese entrepreneurs with that Silicon Valley spirit.

SAM ALTMAN PRESIDENT, Y COMBINATOR "We've been interested in China for a long time, and I think if you look at what's happened in the last five years and especially in the last couple of years, I think it is become clearly one of the world's most important centers of startup activity and we go wherever the best founders are."

Based on joint report by Chinese I.T. companies NetEase and ITjuzi, the majority of startups in 2017 focused on e-commerce, entertainment, AI developments, big data, and company services. And many of them are based in I.T. hubs such as Beijing, Guangzhou, Shanghai, and Zhejiang, also areas which draw the most investments.

The report also suggested the number of new start-ups in that same year had declined compared to 2015. But such a downwards trend seem to be of little alarm to the fresh talent flowing into China.

For Chinese website building company Strikingly, which recently moved its base back to Shanghai from the US, it seems like the business environment here is one filled with new benefits that outweigh the challenges.

DAVID CHEN CEO, STRIKINGLY "We were by fact living in the future when we came back to China, digital payment. You're in China and have probably sensed that already yall of those are the power of technology and also the new business model that came out from this new entire entrepreneurial revolution. That's coming up in China that spring out this new stuff. You don't feel that as much when you're in the US."

The robust number of start ups are also a plus for investors who are looking to expand business ventures and opportunities. But a overcrowded market can lead to other concerns.

CHEN HONGWU EXECUTIVE PARTNER, CASH CAPITAL "The vastness of the Chinese market, it's stable political system as well as this heightened sense of entrepreneurship are all qualities that make China a suitable place for investments. However, this can also lead to temporary challenges such as over-funding of certain projects which could sometimes hinder proper growth for a new company."

Chen says with time, the market will filter out bad projects. But proper management and guidance for new players are needed.

And for incubators such as YC which aims to nurture new ideas, the Chinese market seems like a good place to start.

ERIC MIGICOVSKY HEAD OF CHINA, Y COMBINATOR "We invest in early start-ups, usually before they've raised Series A. YC, on the other hand, is a long-term investor, for example, one of our first investments, DropBox, actually just went public two weeks ago. That was an investment we made 11 years ago."

So how will China's 1.3 billion consumer market continue to support the country's evolving tech environment?

REN XEUQIAN BEIJING "With the increasing number of online users in China stimulating more and more government investment in tech, experts believe it will draw a surge of fresh talent to the field, and create new opportunities for entrepreneurs. They say it could also make China's dynamic start-up scene even more attractive to investors. Ren Xuqian, CGTN, Beijing."