Despite the fact that the Middle Kingdom is currently bursting with investment capital, the secret to successfully launching in China is still relationships and market knowledge, according to Qunar co-founder Frederick Demopoulos who spoke at TechCrunch Shanghai this Monday. Qunar, one of the country’s largest travel service websites, is among the most successful foreign co-founded companies currently working in China.
“You have to think carefully what value you have, and how you can operate the company with that value,” said Demopoulos. “A lot of foreign investment was made here in China to penetrate the market. However, somehow they mostly failed. Why did they fail? They had money, technology and great management, plus operations.”
“The answer is market expertise. You need to have Chinese people to do the business, so think carefully, ‘do I have key business relationships to operate the business?’ A Joint venture between a foreign company and a Chinese company is one option, or bringing in a local expertise can serve as a great way to structure your team.”
Demopoulos also offered encouragement for startups looking to enter a market that is currently strongly dominated by fast, heavily-funded investment from giants such as Baidu, Alibaba and Tencent (BAT). “In recent years, we’ve been talking all about BAT. But I remember 10 years ago people in Silicon Valley were all talking about GYM (Google, Yahoo, Microsoft),” he said. “We should know that things change quickly, like a small group of armies attacking big troups. Ten years later, there could be Q inside BAT, stands for Qihoo or Qunar, who knows.”
“There is an opportunity for new entrepreneurs. Now the real resource is those in their 20s generation now. I see in our company also, there are very smart young people who want to go to Tel Aviv and Berlin to start their own business. With many more Computer Science graduates now, certain talents have keen consumer perspectives and tend to be very open minded to new technology,” he added.
Image Source: TechCrunch Shanghai