Speaking at CHINICT, the Founder and CEO of Qihoo 360, Zhou Hongyi, used his years of experience fighting as an entrepreneur in China to divulge some unique advice and insight. Qihoo 360 is most famous for being China’s most free downloaded anti-virus software and listed on the NYSE in March 2011.

To me, Zhou’s most interesting insight was why China has a tendency to copy successful businesses from America. Many believe that Chinese start-ups and big companies clone high growth start-ups because they lack creativity and even ethics. However Zhou’s take is that they copy because they are scared. They are scared of failing in a highly competitive market, so copying gives them some comfort that a proven business model has a greater chance of succeeding.

Another unique perspective of why Chinese tech companies’ clone is because regulations in China allow it. Zhou said in the U.S. when Microsoft bundled the browser Internet Explorer to kill Netscape, the U.S. government harshly criticized Microsoft for trying to monopolize the market, hence giving them a bad public impression. However in China, there are no real regulations against monopolies, therefore nothing is really stopping big tech companies like Baidu, Tencent, Sohu etc. dominating the market by crushing smaller start-ups by taking their product and idea. To emphasize his point, Zhou pointed out that since the rise of the giant tech players like Baidu, Alibaba and Tencent in the 90’s; there has been no other big tech company created since them. Using their deep pockets of cash and large team to readily deploy, big companies muscle and ultimately oust their little, younger start-up competitors.  Such a bleak and difficult environment lead Zhou to warn that “China is not a happy land for young entrepreneurs.” The only advice he could give to start-ups was to run faster and do something very different from big companies.

Start your free trial now.

Get instant access to all our premium content, archives, newsletters, and online community.

Monthly Membership

Yearly Membership

What you get

Full access to all premium content and our full archives

Members'-only newsletters

Preferential access and discounts to all TechNode events

Direct access to the TechNode newsroom

Start your free trial now.

Get instant access to all our premium content, archives, newsletters, and online community.

Monthly Membership

Yearly Membership

Jason Lim

Jason is an Australian born Chinese living in Beijing, specializing in entrepreneurship, start-ups and the investment eco-system in China, especially in the tech and social area.