Yesterday I talked with Skype co-founder, Niklas Zennström during his trip to China. He said his venture capital fund, Atomico, want to invest in Chinese startups which are looking for overseas markets.

“If a Chinese startup wants to develop, say German or Brazilian, market, I believe Atomico, will be in good position to help it,” said Niklas. After Niklas and Janus Friis sold Skype to eBay, the pair found a venture capital fund in 2006. Capital of its first fund came from their own pocket, about 40 million Euro. Last year, they raise a new fund, about US$165 million, from mostly European institutional investors. They have invested in European and U.S. tech startups, and they have also invested in 2 companies in Latin America (Brazil). But nothing in Asia yet. Maybe that will change soon after this trip.

In his trip to China, Niklas has met many of the Chinese internet titans.  One thing he realized from the meetings is that Chinese internet market is very different. The rules are different (e.g. you cannot rely on IP protection to defense off competitors) and so are the players. Most of the major players in Chinese market are local companies, such as Baidu, Tencent, Alibaba, etc. “It is very hard for international companies to succeed in China,” said Niklas.

The venture capital market here is very competitive. “There is lots of capital. Money alone is enough, you have to add value,” said Niklas, “For Atomico, we are an international venture capital fund and we can help companies to grow internationally.”

The most famous example is Skype, which grow from its origin in Sweden to practically everywhere in the world. “We understand the market environment in each region – the regulations, consumer behaviour, etc,” said Niklas, “We can help Chinese companies to export their products or services.”

One area he is interested, in particular, is game. “Games, no matter, mobile or casual, are popular. You can see most of the top iPhone App are games,” Niklas. China has a strong game development community and many of them are developing the intentional market. For example, Beijing Rekoo, has become a top social game operator in Japan. Niklas and his team should find what they like pretty soon.

In the next few days, we are going to talk about what Niklas believe are the coming trends ?? what are his words for young entrepreneurs ??   What does he think of the Chinese market?? etc.   By the way, here is a video clip about yesterday’s interview: