During the GES 2016, I attended the Entrepreneurship in China panel, moderated by Hong “Helen” Qiao – Chief Economist for Greater China, Bank of America/Merrill Lynch. The panel included Feng Deng – Founder, Northern Light Venture Capital; Jean Liu – President, DiDi Chuxing; Professor Shoucheng Zhang – Founder, Danhua Capital; professor of physics, Stanford University. They shared insights from within and outside of China.
In China, the panel affirmed, the internet is driving growth in banking, education, entertainment, commerce, healthcare. High speed rail is life changing experience. Availability of capital is allowing technology to be applied.
Setting up and running startups in China is becoming easier. Didi invested in developing an App for car on call in 400 cities. Innovation is about tackling local issues, said Jean. China is complex and dynamic and one solution cannot fit all. Their challenge is to match supply and demand. Mining data to predict demand and dispatch cars in vital. They have effectively created Uber of China. They employ 3 million drivers a month! This is job creation and revenue generation from meeting a local need.
Panellist share common backgrounds, all born in China and came to US for further study. Three have returned, taking back with the knowledge, experience and most importantly the networks they established during their time in the US. Demand for education they said in China was huge. Entrepreneurship demands constant mode of learning. Professor Shoucheng Zhang – Founder, Danhua Capital Stanford University shared his story of how when he visits China, 10,000 will listen online and offline, evidence of the dedication to learning. Environment is constantly changing and entrepreneurs must learn and adapt. China they all affirmed will rise up rapidly in the field of entrepreneurship.
On the question of building bridge between US and China, technology they said will play a significant role. The USA and China will co-develop solutions, innovative on the mobile, ARVR. Chinese are highly educated in mathematics and well placed to lead in this space.
The ecosystem for entrepreneurship is also improving. In 10 years, China’s ecosystem has come a long way, huge progress has been made. A number of factors have contributed to this including returnees, success of the internet companies, product management, emergence of structured companies, and knowledge of how to build small startups. Change in culture and society where being an entrepreneur is more acceptable, parents are happy for their children to join startups! Government is playing its part in making entrepreneurship a part of the economic growth plan. They are also learning to be less “hands on”, allowing the private sector, such VC to take the lead. Central and local government agencies are helping Chinese startups set up companies.
On how long it will take for China to catch up with Silicon Valley: All the panelist agreed it will take long time due to education reforms. Silicon Valley attracts world’s best talent while China is attracting only “returnees”. China needs to harness the non-Chinese already in the country to become part of the society.
This offers huge lessons for the development of an ecosystem in Africa, role of education, VC, technology, harnessing talent, African diaspora and of course Government to build the African entrepreneurial class.