With uncertainty and shaky financial figures being constantly reported from America and Europe, it seems the world’s beacon of hope is Asia and more specifically the second biggest economy in the world, China.

This new global power shift has seen nearly every company from every country trying to get a foothold in the lucrative China market. With endless reports of giant foreign companies failing to culturally adapt to China and consequentially dying, with the obvious current example of Groupon; smarter people are learning to partner up with people who know China best. Arguably even the most famous incubator, Y Combinator would likely have trouble establishing itself in China.

Today, Innovation Work’s, the most powerful early-stage high tech investment incubator in China has raised a big new US$180 million fund. Some of the heavy weight investors include Yuri Milner and Ron Conway. Milner of DST has famously shaken things up in the investment world after pumping a lot of money into Facebook, Zynga and Groupon. Conway as a Super Angel, with investments in Google, Paypal and Twitter is personally investing in Innovation Works. The rock star investor said, “Over the years, I have helped numerous companies in the United States from their founding.  When I saw that Kai-Fu’s Innovation Works has built up a great team planning to do the same in China, I became very excited.  I personally invested in Innovation Works, and recommended many of Silicon Valley’s top investors to invest.  Innovation Works has already shown excellent early results, and we look forward to their continued success.”

The fund called The Innovation Works Development Fund (IWDF) is the first U.S. dollar-based fund raised by the firm to be specifically focused on the Chinese Internet. This new fund was over-subscribed, demonstrating the clout of IW and confidence in the future of Chinese internet companies. IW has incubated and invested in about 34 companies of which 9 have secured large Series A financing from top tier VC’s.

Other participants in the fund raising include WI Harper, Silicon Valley Bank, Baillie Gifford, Sequoia Capital, IDG-Accel, Foundation Capital, Mohr Davidow, Chunghwa Telecom, Singapore Telecom, Mediatek, Foxconn, New Oriental, SAP, Bertelsmann, Motorola, Autodesk, pension funds from the U.S. and Canada, investment luminaries including Ron Conway and Yuri Milner, as well as executives and former executives from top Internet companies like Yahoo, Google, YouTube, Facebook, and Amazon.

If you are not familiar with the companies that have come out of IW, you can read some of our past posts on DianDian, Umeng, Doodle Mobile and Xing Cloud.