As the U.S.-China trade rift continues to deepen, Chinese tech entrepreneurs are finding it increasingly challenging to expand into the United States, traditionally seen as a major goal for such ventures.

In the past, Chinese businesses faced relatively few obstacles to operate in the U.S. However, recent U.S. sanctions against prominent telecom player Huawei, amid escalating tensions, have resulted in many Chinese enterprises establishing overseas headquarters in hopes of avoiding U.S. scrutiny.

Increasingly, owners of Chinese tech firms are considering gaining foreign residency or citizenship to sidestep the growing restrictions and perceived biases towards Chinese businesses in the U.S.

Ryan, a software startup owner based in Shenzhen who requested anonymity due to fears of repercussions, expressed his dismay over the restrictions faced by many Chinese companies. "It's very unfair," he stated, pointing out that rivals from other countries aren't facing similar barriers when trying to enter the U.S. market. His response? Ryan is seeking permanent residency in another Asian nation.

Reuters interviewed seven tech entrepreneurs from mainland China who are exploring foreign residency or citizenship to further their U.S. business expansions. Their options span across multiple locations including Hong Kong, Canada, Japan, the United States, and Singapore. These individuals asked for complete anonymity due to potential backlash in China, and chose not to describe their businesses in detail.

The adversarial climate between U.S. and China, originating from the Trump administration and persisting under President Joe Biden, continues to pose major hurdles for mainland Chinese companies seeking to operate or gain investment in the United States, entrepreneurs and consultants agree.

Despite the difficulties, breaking into the U.S. market remains a key objective for these entrepreneurs, who view focusing on the domestic market as less appealing. Discontentment with the regulatory crackdown on China's tech sector since late 2020, compounded with the pandemic's stringent zero-COVID restrictions, have led to a widespread disillusionment with China under President Xi Jinping.

According to Chris Pereira, a business consultant based in Shenzhen, the trend of firms looking to relocate offshore and 'de-China' their company identity is increasingly prevalent. Examples of such companies include fast-fashion retailer Shein, and e-commerce firm PDD Holdings.

These entrepreneurs reveal a sense of skepticism towards Beijing's support for private business owners, and concerns over diminishing civic freedoms. Cultivating ties with the Chinese Communist Party, often seen as a necessity for success in China, is a step they are reluctant to take.

One such entrepreneur, Tommy, chose to close his business due to excessive government censorship requests and is now launching a new startup abroad. His ultimate goal? A move to the United States - a dream that remains strong despite an encounter with U.S. customs officials questioning his U.S. bank account during a recent business visit.

These narratives paint a picture of an emerging shift, where ambitious Chinese tech entrepreneurs are exploring alternate routes to bypass the rough waters of U.S.-China relations.