How to build a successful startup in China? We asked at ChinaBang 2018

5 min read

TechNode just hosted ChinaBang Awards 2018 in Shanghai and invited the most promising tech startups and investors inside China. (Here’s the full list of award winners.) But how did these companies get to where they are now? We hit up with people from five Chinese companies who won the awards and asked what were their achievements and their competitive edge of winning the turf war.

Best Company of the Year: VIPKID

(Image Credit: TechNode)

VIPKID is one of the new-born Chinese unicorns in 2017 in the education space, providing one-on-one online English class to children between the ages of five and twelve. The Beijing-based company hired 40,000 English teachers from North America taking the concept of geek economy and reportedly has 300,000 paying users in China. The teachers on the platform get a wage between $14-22 for a 25-minute class.

Many married women, mainly coming from the east and middle part of US joined the platform, and VIPKID team gave them empowerment and training. In September 2017, a VIPKID teacher lost her job at VIPKID and criticized the company online. VIPKID told TechNode that they hire teacher managers to communicate with its teachers and solve these problems. For example, they organized a VIPKID meeting and seminar in Utah to form a community around hundreds of teachers in the US.

“While teaching English to Chinese kids, these US moms get a better understanding of China. Later, they even have their children learning Chinese through VIPKID’s sister brand Lingo Bus, which has a similar model with Chinese teachers teaching Chinese to foreign kids. The users and teachers are interacting with each other,” a VIPKID insider told TechNode.

Established in 2013, VIPKID launched their product in 2015. Li Kaifu, founder and chief executive officer of Innovation Works and other VCs including Northern Light Venture Capital tried out the product with their child first and later invested in the product. Now the company hires 4,000 employees.

Best Entrepreneurial Service of the Year: 优客工场 UCOMMUNE

(Image Credit: TechNode)

URWORK became China’s first co-working unicorn in January 2017, after raising an RMB 400 million ($58 million) Series B at a valuation of 7 billion RMB ($1.02 billion). Later they rebranded their name to UCOMMUNE.

“It’s mainly two things that make us competitive in the market. First, we have expanded to 37 first-tier and second-tier cities around the country, and that way, founders can move around these cities and work. Second, based on our wide network, we can connect companies with our network and provide more services,” Lu Yongfeng, Senior Director of UCOMMUNE told TechNode.

Transportation Service of the Year: 凹凸租车 Atzuche

(Image Credit: TechNode)

P2P car lending platform Atzuche allows car owners to rent out their unused cars, and earn money on top of their platform.

“75% of our users rent a car for traveling and the rest of them use it for business use, or just to drive special cars. Brand cars like Subaru and Maserati on our platform are much more affordable than other companies,” Xue Zhaomin, the CMO of Atzuche told TechNode.

Established in May 2013 by Shanghai-born founders, the company expanded to 62 cities in China in five years. Atzuche kept on expanding and raised over RMB 95.5 million ($14.7 million) via JD’s private equity crowdfunding platform JD Dongjia in May 2016, while P2P car lending platforms in China saw its peak in 2015 and later many shut down their service in 2016.

“They later all failed because they invested too much money on marketing so the user experience was so bad. However, we put 70-80% of our resources on operations including car delivery, insurance, and user claims,” he said.

Best Enterprise Service of the Year: TalkingData

(Image Credit: TechNode)

TalkingData provides data analysis about their business for Chinese companies like Tencent, Baidu, US companies like Google, Yahoo, and Zynga, and traditional companies like China UnionPay, China Merchants Bank, and CITIC.

“These days, many retail giants are using us. With the OMO (online merge offline) trend, they have to apply data science on the supply chain and store management while channeling their online solution to offline business,” Bao Zhongtie, senior analyst at TalkingData told TechNode. “I have a positive perspective on their growth. After the new retail integration, offline businesses are getting better.”

Most Innovative Company of the Year: 数坤科技 Shukun

(Image Credit: TechNode)

Shukun Technology uses artificial intelligence technology to improve the diagnostic experience in hospitals. It combines expert intelligence and machine intelligence to increase the level and efficiency of medical service for both doctors and patients.

The founder and CEO, Anne Ma, was formerly at IBM with more than 10 years of research experience in AI technology improving healthcare. She later started Shukun with other founding team members who hail from IBM Waston, GE Health, and Alibaba. The Beijing-based team is in the process of developing AI Doctor and is building a business model on top of it. Their product CoronaryDoc is a first-in-class AI product that diagnoses heart disease and is going through clinical trials.

“By 2018, there were over 100 companies in medical AI sector in China. It’s making continuous significant progress in more and more disease diagnosis even though there are still challenges from government regulations. It is welcomed by first-line doctors because it improves efficiency and effectiveness of diagnosis,” Ma said.

Outbound Startup of the Year: 惠租车 Huizuche

(Image Credit: TechNode)

Huizuche provides car rental service for online travel agencies on Ctrip and Didi’s international platform in the US and Europe as well as airport pickup service on the China Eastern airline app.

“The competitive advantage we have is that we allow users to compare the price, and provide cheaper services than other players. We see the trend of 20% of travelers going to other countries and they want to drive the car by themselves,” Huang Haoming, CEO and founder of Huizuche told TechNode.

“Our customers have different needs depending on the country they visit. Tourists visiting North America like to drive by themselves while those visiting Southeast Asia want to hire a local driver instead,” he said.

Huang says that most of Huizuche customers are visiting the US, followed by Germany where they also rent cars. Next is Thailand where users usually rent a car with a local driver accompanied by a Chinese translator. In Japan and South Korea, the company has a pool of Chinese drivers.

“When entering a new market, we first find global car rental companies like Hertz and establish a partnership, then we upgrade the product together. If a fleet of drivers is living in an overseas country, they can download the app and join the platform,” Huang remarked.

Currently, the Shanghai-based company is operating in 30 countries where it is only providing car rental service. However, they aim to go further into hotel and flight booking.