PALO ALTO, U.S. — Overseas investors scaled back venture capital deals in China in August as the country's regulatory crackdown on the tech sector prompted many to rethink their approach. The latest figures from market research company PitchBook represent a sharp break from earlier in the year. Chinese startups have raised $32.6 billion from 634 deals that included foreign VCs this year as of Aug. 25, compared with $18.9 billion from 453 in the first eight months of 2020. So far in August, however, just $800 million has been raised from 67 deals with foreign participation, down from $4.7 billion…