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Technology startups along the Shanghai-Nanjing corridor, known for “funding in Shanghai and production in Jiangsu,” still largely depend on self-financing despite the development of a collaborative regional innovation network. According to a recent survey, 72 percent of these startups have been unable to secure formal loans.
The corridor encompasses nine cities—Shanghai, Nanjing, Wuxi, Changzhou, Suzhou, Nantong, Yangzhou, Zhenjiang, and Taizhou—that are gradually building a cooperative ecosystem for technological innovation. This trend was highlighted in a report based on funding demands, released at the recent Shanghai-Nanjing corridor urban bank-enterprise matchmaking event.
Despite this regional synergy, funding gaps remain substantial. Approximately 42 percent of startups report that obtaining financing is either difficult or very difficult. Many entrepreneurs continue to rely heavily on personal funds to support research, development, and daily operations. Shanghai has attracted numerous established investment firms, which give it a competitive edge in early-stage funding—covering angel investments and Series A rounds. Meanwhile, Suzhou stands out as the leading city for tech startups, benefiting from strong manufacturing and R&D strength. The innovation drive has been expanding from southern parts of Jiangsu into its northern regions.
Traditional loan models, which rely heavily on collateral assets, are ill-suited for tech companies that are asset-light and R&D intensive. About 41 percent of survey respondents cited lack of collateral as a major obstacle to securing loans. Core assets such as intellectual property and accumulated R&D are still difficult for banks to quantify as risks, making it hard for promising innovative firms to access credit.
A significant 61 percent of startups are calling for financial institutions to introduce new models of unsecured credit loans, which could greatly ease early-stage funding difficulties. When it comes to regional technological support policies, many companies that haven’t utilized these services view the application process as overly complicated—about one-third believe the procedures are too complex—and 28 percent mention lengthy approval cycles as a major barrier.
Startups voice high expectations for improvements in the financing environment. Nearly 66 percent hope more investment firms will target early-stage, small-scale, and high-tech ventures. Over 36 percent are seeking industry capital investments, aiming to leverage the sales channels, customer bases, and application opportunities that these investors could provide to expedite technological commercialization.
While the nine-city corridor has laid a solid foundation for domestic innovation, further steps are needed to help startups grow into new engines of regional economic development. This includes optimizing early-stage funding systems and fostering better collaboration among investors, policies, and supply chains.
The survey also notes that the corridor, defined by the economic geography encompassing nine coastal cities along the Yangtze River—most of which are in Jiangsu province—continues to evolve as a hub for technological innovation. However, more targeted policy and financial reforms are essential to realizing its full potential in nurturing new industries.
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