Lenovo Group Ltd, the world's largest personal computer maker, will invest about $100 million in Israeli startups over the next three years to better tap into local talents and cutting-edge technology to grow its core business.
"We will focus on the internet of things, cloud computing, cyber security, image recognition and other areas which Israel excels in," Song Chunyu, vice-president of Lenovo, said in an interview with China Daily.
The move came after the Beijing-based firm has poured up to $20 million into at least six Israeli startups and CPI, a local venture capital fund, in the past several years.
Israel, known for its innovative engineering, has become one of the most popular destinations for Chinese investment as China works hard to upgrade from a manufacturing hub into a tech center boasting core technologies.
Internet giants Baidu Inc and Alibaba Group Holding Ltd as well as traditional firms such as Ping An Insurance (Group) Company of China Ltd are all spending big to fund local startups.
"Compared with their Chinese counterparts, Israeli firms are more willing to spend years and even a decade on the research and development of a key technology. That is the most appealing point," Song said.
Also, the Middle East country, which has a small domestic market, is quite open to foreign investors and it is relatively easy for Chinese firms to expand their presence there, he added.
The investment plan is part of Lenovo's broad efforts to seek new growth points and pioneering technology, as it is wrestling with a slowing global demand for PCs and a faltering smartphone business.
In May, the firm set up a $500 million investment fund, looking for promising early-stage startups in China, Israel and the United States.
Di Jin, a research manager at IDC China, said Lenovo's PCs and smartphones are facing fierce competition, and its overseas investment plan highlights its determination to try new technology, but such efforts won't have an impact on its sales performance in the short term.
In 2015, more than 40 percent of the venture capital investment into Israel came from China, data from the Israeli Ministry of Economy and Industry show.
According to Song, unlike its Chinese peers who are new to the Israeli market, the company's local branch, which consists of more than 100 employees, gives it an edge in understanding local startups.
One of the recipients of Lenovo's investment in Israel is Neura, a platform that helps users personalize connected devices while guarding their data.
"Neura is brilliant in algorithms and it can offer more reliable and stable sensors than Chinese firms," he added.
