The number of "little tech giants" in Tianjin rose to more than 3,400 last year from 726 in 2010, with their share of local industry increasing to 48.4 percent from 16 percent.

These companies have invested an average of 5.4 percent of their profits on research and development, compared with 2.5 to 3.5 percent by major multinational corporations.

Most of the emerging companies concentrate on new energy, biopharmaceuticals, electronics and equipment manufacturing, according to Wei Yongjiu, head of the Tianjin Administrative Bureau of Small and Medium-sized Enterprises.

"The tide of innovation will restructure our economy and upgrade our industry," Wei said.

In the past five years, the government has invested 20 billion yuan, in subsidies, venture capital and startup funds to support technology innovation in these enterprises.

Contact the writer at peipei@chinadaily.com.cn