Chinese Internet security provider Qihoo 360 has established a venture capital company in Silicon Valley to invest in start-up companies with strategic significance.

Qihoo 360 expects to enhance its own products and expand its user base with the technologies of those start-ups based in the U.S. Mike Liao, Qihoo 360's strategic action director, said that the company will invest in those who can help them reinforce their digital security services.

Qihoo 360 did not set a detailed scale for its venture capital fund. With a market value of USD10.8 billion and USD0.54 earnings per share in the latest financial quarter, Qihoo 360's new fund will probably not be short of money.

Liao previously led the company's investments in four companies, covering big data, smart devices, and home security applications. EyeVerify, an eyeprint verification company, was one of the targets. The company aims to extract data points from retinas to replace passwords and fingerprints. Qihoo 360 plans to integrate EyeVerify's technologies into its 50 game, security, and mobile bank applications.

But as a Chinese technology security company, Qihoo 360 faces potential trust issues both with American businesses and the American government. Though Qihoo 360 is a publicly-listed company in the United States, its intentions and corporate governance within China may come under scrutiny. On the flip side, American technology companies may too be suspect, as recent revelations in the media showed some companies like Cisco may have unwittingly collaborated with the U.S. government to embed spy mechanisms in the American technology companies' devices and software.