Augmented reality startup Meta Co. was on the verge of raising funds from Chinese backers when the lead investor froze the deal at the behest of a Chinese official who cited the trade war.
It’s the latest sign that U.S. tariffs on Chinese goods and a crackdown on foreign investment in U.S. tech companies is casting a chill in Silicon Valley. Small hardware makers
are already suffering from rising tariffs, and now startups looking to raise money in China are feeling the effect.
Meta Chief Executive Officer Meron Gribetz says he had locked up a $20 million investment from a Chinese private-equity firm and real estate entity. Other backers had also agreed to commit but could pull out now that the lead investor is balking. The reversal prompted Gribetz to furlough about two-thirds of his approximately 100 employees for 30 days.