China’s technology scene has been in the news for all the wrong reasons in recent months. In the wake of the scuttling of Ant Group’s IPO, the Chinese government has gone on a regulatory offensive against a host of technology companies. Edtech got hit. On-demand companies took incoming fire. Ride-hailing? Check. Gaming? You bet.

The result of the government fusillade against some of the best-known companies in China was falling share prices. The damage topped $1 trillion among just public Chinese companies listed abroad.

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What about startups in sectors that were reformed overnight? If their public comps are any indication, even more wealth was deleted in the recent wave of crackdowns.

The Exchange was curious about the impact of the Chinese government’s actions on the venture capital market. The Chinese startup economy has produced a number of world-leading companies. Tencent and Alibaba, yes, and even Baidu have become well-known for a reason. Could regulatory changes shake up the venture model that helped grow the country’s largest tech concerns?

After we checked in on the same question this Monday, SoftBank provided a partial answer, noting yesterday that it is pausing investments in China. The Japanese teleco, conglomerate and investing powerhouse has been deploying capital at a rapid pace in recent weeks. That will slow, at least in China. Here’s the WSJ:

Is SoftBank early to its decision to shake up its investing strategy, missing Chinese deals for some time? Or is it late? We secured data from PitchBook and Traxcn that paints a somewhat surprising picture of venture capital activity at least thus far in Q3 2021.

But first, a reminder of how well China’s venture capital market was performing as 2020 eased its way into 2021.

China had a reasonably good Q2 2021 despite the turmoil.

Sure, funding flowing into Chinese startups was down 18% compared to Q4 2020, per CB Insights, but that quarter had recorded an all-time high of $27.7 billion. With $22.8 billion raised, Q2 2021 still did better than every other quarter since Q2 2016 with the exception of Q2 2018, Q4 2020 and Q1 2021. Indeed, the ecosystem had started to cool down in late 2018 before picking up pace again at the end of 2020.

However, that’s only one way to look at the numbers. If you compare recent Chinese venture results with other regions, it underperformed. During Q2 2021, U.S. funding reached a new high of $70.4 billion, with places like Latin America, Canada and India also establishing new records.

This also means that China lost ground as to its share of global startup dealmaking, and the same goes for unicorn creation. According to Tech Buzz China’s summary of CB Insights data, the U.S. accounted for 132 unicorn births between January 1 and June 16, 2021, compared with just three in China.

Slightly falling quarterly venture capital totals and a notable decline in unicorn formation does not a startup winter make. So let’s look at what’s happened more recently.

The thesis that there would be an instantly obvious slowdown in Chinese venture capital activity is not supported by the data we secured.