“Are there areas where you see there is too much hype?” Elzio Barreto, a Reuters correspondent asks three veteran China-focused venture capitalists on stage at RISE Conference in Hong Kong. He cites a recent incident where an umbrella sharing company in Nanchang, the capital city of Guangxi Province, lost all its 30,000 umbrellas within a few weeks from its launch. As the investors chuckle, they come to the consensus that China’s sharing economy is overhyped.

“The sharing economy, the entire thing where you can scan a QR code and pay one RMB for something, is being overly hyped up in China,” says Harry Man, Partner at Matrix Partners China. Man oversees investments for the China branch of Matrix, whose notable early-stage investments include Apple and SanDisk.

In the last few years, the “sharing economy” has become a warm and fuzzy word for Chinese entrepreneurs who dream of facilitating the community sharing of everything, from umbrellas, orange juice machines, stand-alone KTV booths, massage chairs to the most recent buzz around power banks. At the beginning of this April, five power bank rental startups received a combined RMB 300 million ($43 million) financing within ten days with 20 investment firms involved. The Chinese government has also jumped on the sharing trend, expecting the sector to grow about 40% this year to 4.83 trillion yuan ($705 billion) and account for around one-tenth of GDP by 2020. Most of these sharing promises, however, will never take off to the extent that car and bike sharing did.

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Rita Liao

Telling the uncommon China stories through tech. I can be reached at ritacyliao [at] gmail [dot] com.