China tech start-ups show potential: Expert

China bull holds strong

An early Xiaomi investor said Wednesday that "old-economy stocks" might be suffering in China today, but tech start-ups continue to show promise.

Hans Tung, of GGV Capital, told CNBC's "Squawk on the Street" that most stocks in Asian markets are old-economy stocks in commodity production, brick-and-mortar retail and distribution.

"For us institutional investors who invest in start-ups, we are actually very bullish in China. We've been investing in them for over 15 years; we went through three cycles, so we are more experienced in dealing with the ups and downs. I think it is actually the best time to invest in start-ups in China," he said.

Tung said growth in China will improve as "the new-economy start-ups and companies continue to take bigger chunks of GDP growth."

"What people have been focusing on are the old, offline-economy companies, and they are certainly hurting and slowing down because they are not equipped to handle the mobile Internet new world," he said.