China’s venture capital sector is in crisis due to the dominance of government guidance funds (GGFs), prompting intervention from policymakers. On January 7, the State Council, led by Premier Li Qiang, announced 25 measures to address GGFs’ management, performance, and investment practices. The guidelines aim to promote GGFs as patient capital for technological innovation and improve coordination among local governments. A proposed national-level parent fund could unify local GGFs, enhancing capital allocation efficiency and alleviating regional constraints. While beneficial in concept, this fund faces challenges in ensuring stability and transparency in management and investment practices.