Chinese tech giant Tencent has invested in a British start-up that builds simulation software for the army, Telegraph writes.
In a deal said to be too financially insignificant to trigger a national security review, the Chinese gaming company joined a £15m funding round for Hadean, which is developing technology to bring tens of thousands of virtual soldiers onto digital battlefields.
In another twist, Tencent joined the funding round along with In-Q-Tel, a US venture capital investor backed by CIA funds.
Hadean has also secured funding from the government’s Future Fund, the start-up bailout fund created by Rishi Sunak during the pandemic. It is also advised by experts from the National Security Strategic Investment Fund (NSSIF).
Founded in 2018, the NSSIF invests in highly sensitive defence start-ups and is closely associated with Government Communications Headquarters. It also gives start-ups access to security experts at the heart of the UK intelligence community.
The deal, therefore, means that the UK government, a CIA-backed fund and one of China’s biggest tech companies are partners in the same company.
Hadean chief executive Craig Beddis said the company was “very aware” of the origin of its investments and said shareholders like Tencent “didn’t have access” to sensitive technology.
He added that the proportion was too small to justify a notification under the UK’s National Security and Investment Act, the spearhead of a crackdown on Chinese investment in the UK.
Mr Beddis said, “Tencent is obviously huge in the metaverse and in gaming, which explains why we made the investment.”
Tencent has previously backed companies like Epic Games, the developer of Fortnite, social media company Snap, and digital bank Monzo. It recently bought UK-listed games developer Sumo Group.
Written by Adekunle Biodun