About the speakers
Jill Tang is a serial entrepreneur, community builder and Women in STEM advocate. She is the co-founder of Ladies Who Tech, a social enterprise focusing on promoting gender diversity and inclusion in the STEM industry through offering women digital skills education, career opportunities and community networking. Forbes China, the Guardian, BBC, TechNode have reported on her work. Jill holds an MBA from Melbourne Business School.
Olivia Plotnick is a social media enthusiast, obsessing over how brands connect with audiences on today's most powerful digital platforms. After working for global marketing agencies in Shanghai she founded 'Wai Social,' a boutique social media marketing agency focused on helping brands build relationships and communities with Gen Z and millennial consumers in urban China.
Kevin Johannes Wörner is Head of Accelerator at XNode, co-founder & angel investor in tech startups and guest lecturer at institutions such as Fudan University or Shanghai University. He specializes in helping foreign tech companies enter the Chinese market and has worked with 50+ firms in the past, mostly from the MedTech, EdTech and FinTech industries. In the past, he worked at top-tier companies in banking and management consulting across APAC.
Jonas Wolf (co-host of the panel) is an entrepreneur coach & leadership trainer with 10+ years of experience, working in Germany, the US and China. He founded LeaDAOship with the mission to grow leaders through coaching, training and events. He also developed and led the business in the APAC region for AngelHack. Over the years, Jonas had the chance to mentor, coach and work with over 200 startup teams.
On December 10, 2021, the four entrepreneurs took part in EqualOcean's World Innovators Meet (WIM2021), having a panel discussion on foreign entrepreneurship in China. Here below we present the most important takeaways from their conversation.
'Chinese characteristics'
Jonas: What was your highlight of the entrepreneurial journey in China?
Jill: Social entrepreneurship is still quite new in China. It is not easy because it basically involves doing the work of changing people's mindsets. Nevertheless, more and more Chinese companies have started to pay attention to ESG (Environment Society and Governance) and look for sustainable growth.
Kevin: From the experience of my venture, you must have the belief that everything is possible in China. Somehow you always find a way, even though doing business is quite complicated. In addition, the kind of optimistic attitude is quite common in my team even for people outside of China.
Olivia: One of the biggest challenges foreign founders face in China is building the right team. Sometimes foreign founders can struggle with empowering their local staff, and local employees often rely on the founders to make decisions and take the lead, which is problematic. Having a team that can operate smoothly without being restricted by geographical distance can be a significant achievement for a growing company.
Other challenges
Jonas: What are the key obstacles that you or an affiliated startup have faced here?
Kevin: The first thing is hiring. Though there are over 1.4 billion people in the country, it is tough to find the right people. For example, hiring a sound engineer in China can be tricky if you do not pay around CNY 50,000 per month, a significant burden for startups. As a foreign startup founder, you need to build your own connection and be able to convey trust and a good knowledge of the market to attract talents. The second regards culture. Foreign entrepreneurs are usually faced with cultural barriers. To raise funds and retain continued operation in China, founders really need to get to the ground, be humble and be willing to learn how things are being done in China, which is usually done VERY differently.
Jill: Another challenge is that the culture can be pretty different across different cities. [...] For example, doing business in Kunming, the capital city of southwestern Yunnan province, varies greatly from doing business in Beijing and Shanghai. [...] Lastly, before and after COVID-19, the environment for entrepreneurship in China has been getting tougher and tougher. For those who really want to get a ticket for the China express, managing the language is vital.
Olivia: When it comes to hiring the right employees, foreign entrepreneurs often have a very different mindset. For example, many foreigners expect a high level of transparency. When team members do not understand certain points during communication or something goes wrong, foreign leaders usually wish members would say that immediately. Yet, it is not often raised instantly in Chinese culture when there is an issue or difficulty in understanding stuff. Employees' reluctance to bring up problems can leave an array of difficulties unsolved, leading to a host of obstacles in decision making. Foreign founders thus need to be conscious about how to build an environment and work very closely with Chinese staff so that they can feel comfortable to bring up the problems. Especially in startups where everyone is wearing different hats and things happen quickly, you need to address problems fast. Effective communication with staff is essential.
Hiring local teams
Jonas: A question from the audience: what platforms do you recommend for hiring local teams?
Olivia: Before I started my company in China, I had built up a pretty big network. Staff in the team are mainly recommended, and my best hires come from my network as well.
Kevin: Hiring needs to be primarily a CEO or founder's job for startups. Rather than over-relying on friends, headhunters, or platforms, founders need to be the first or at least the second person to take the call and interview the candidates.
Jill: Same as Olivia and Kevin, my hiring is through referral and my efforts in looking for the right people. As a community-driven platform, we are lucky enough to have a large network of people, and I personally am constantly trying to 'sell' my own company and attract potential talents. As a Chinese, I don't think there is a really great platform. So, for foreign founders, building a trustworthy network is the best way to hire the right staff.
Finding best resources
Jonas: Community, indeed, is a handy tool for recruiting people. Personally, our team has been actively running events for communities trying to build employer branding. The next question concerns the most important / best resources you found here. How did you find them?
Kevin: XNode is a good resource, especially for startups. Some other accelerators such as Plug and Play, TechCode and so on. There is an ecosystem of players trying to help foreign entrepreneurs break into the Chinese market or existing foreign founders to grow. In addition, as long as LinkedIn is not banned in China yet (which I think is going to happen towards the end of this year), it is a great tool to reach out to people.
Jill: I have used all the resources Kevin recommended, and I find them very helpful. In addition, there are a lot of startup programs in China, such as Startup Weekend. Using keywords, foreign founders can find related programs active in different cities across the country. Besides, mentors are quite helpful. When you find the right mentor, they will connect you with the right people and right resources. Lastly, alumni networks are my recommendation for foreign startups too.
Olivia: One of the best things about living in Shanghai is there are many amazing communities. I have been deeply involved with a community called IPWS (International Professional Women Society) where you can join a founder's breakfast meeting every Friday and many other events supporting young startups. People in this community shared with me a lot of advice and gave me coaching and a chance to expand my network.
Selecting an industry
Jonas: What industries are suitable for foreigners to launch businesses in China going forward?
Olivia: Sustainability is becoming a lot bigger in China. Though it is not as big as in the west currently, it is becoming on the top of the mind of many Chinese living in first- and second-tier cities. For example, sustainable household products and plant-based food are getting increasingly popular in China. Since foreigners tend to have experience in these products, they can bring their learnings to China, where the government makes sustainability a bigger topic. In China, when the government is behind something, people get on board, and things happen fast. So, sustainability is something to boom right now.
Jill: To add to Olivia's point, China is really a politics-driven economy. If you follow the five-year plan, you can literally know where the opportunity lies. Like sustainability-related concepts, the metaverse is very popular in China and capital has crowded into related projects recently, even though people don't really understand what that metaverse is. This could also be an opportunity for foreign founders with expertise in the gaming industry.
Kevin: Sustainability is definitely a potential trend here. The second one would be smart manufacturing, which is also a part of the party's agenda. There are billions of manufacturing assets now in China that need to be innovated upon, so this is a considerable chance for entrepreneurs that work with robotics, autonomous vehicles and intelligent devices. The third one would be medical tech. The existence of companies that manage to bring drugs that passed the development stage to China is a testament that there is so much potential to bring here medical and pharma innovations from outside of China. As the population is aging, the government's focus is to innovate on medicine and pharma.
Looking for local support
Jonas: Audience question: what subsidies have you heard about or applied for from the government?
Kevin: The general rule is that the less attractive the city is, the more subsidies you can get. Compared to Shanghai & Beijing, in Nanjing or Suzhou, foreign founders have a better chance of getting support from the government, tech parks or public organizations.
Jill: Now in many 'new tier-one' cities, such as Nanjing, Suzhou, Chengdu and Chongqing, there are a lot of opportunities to apply for subsidies as they are looking for international content, such as foreign startups in the tech parks.
Jonas: True, many tech parks have advisors that actively help people apply for subsidies. In those 'under-the-radar' cities, such as Yinchuan in Ningxia province, when a foreign enterprise plans to open a shop there, all the doors will be open and business development much easier than in the more famous cities.
To sum up
Jonas: For foreigners planning to bring their entrepreneurial ventures or ideas to China, there are still a lot of opportunities out there. Find your circles, network, mentors and advisors, because you will need all those local insights. If you can get into one of the landing pads or accelerators, go for it!
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About China & The World Summit
As a part of WIM2021, China & The World Summit was hosted on December 9-10, 2021. It was focusing on the world's second-largest economy's global impact and interaction with the rest of the world.
WIM 2021 China & The World Summit is built around two major topics:
Ⅰ. Investing in China: Seeking value amid global turbulence.
Over the past decade, China has been an attractive investment destination. But will it remain one in years to come? WIM 2021 gathered global investors, senior executives, and market participants to discuss this and other questions concerning the world's second-largest economy's past, present and future.
Ⅱ. Localization & Globalization: Global enterprises' 'China story' and Chinese companies' global expansion.
China's role in the global economy has been continuously changing. As the country's market matures, the world's largest enterprises have been venturing into it – with varied success. Meanwhile, Chinese new-economy companies are also expanding their presence in foreign markets. At WIM 2021, a number of eminent experts and industry insiders discussed the most important trends and narratives at the interface of China and the rest of the world.
Follow EqualOcean.com and stay tuned for other WIM recap articles!
About WIM2021
WIM2021 'Digital Reshaping the World' will be hosted offline in Shanghai and New York while broadcasting globally. The event covers 11 topics, including the hottest industries (from automotive to healthcare) and concepts (like Carbon Neutrality and 'Zhuan Jing Te Xin').
World Innovators Meet (WIM) is a yearly flagship event hosted by EqualOcean for the past 6 years. It is a time where international delegates gather to discuss hot button topics in China's key industries.
We see innovation as the biggest driving force to building a better world. Hence, through WIM we seek to create a platform for global innovators to connect. By uniting bright minds, we seek to foster learning, inspiration and wonder – and inspire conversations that matter.
In a short span of 6 years, WIM has grown from a local event in China to a global event that bridges the world and China by bringing together 1,500+ international speakers (including several Nobel laureates), 50,000 global attendees, and 2,000+ media and community partners.