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A curated guide to Beijing’s startup scene, part 2
This is the second of two parts on local resources for eager entrepreneurs in Beijing.
Previously, I described Beijing resources for the earliest stages of an entrepreneur’s journey: ideation and incorporation. Below, I continue where I left off, listing organizations that work selectively with incorporated startups to get them ready for funding and scale.
Stage 3: Pre-funding (Post-incorporation)
With an idea, team, and legal entity in place, a newly formed startup will next need to prove out its business model, especially if they hope to convince investors to provide capital for growth. Various actors in Beijing offer programs to help at this point.
Understanding the core motivations of these actors is helpful when considering your options. Some take fees, plain and simple. Some seek startups for their sponsors. Others take equity, owning a small piece the startups they work with. Programs are grouped below accordingly.
Some programs for entrepreneurs are subsidized by donors with specific agendas.
Innoway is a state-owned enterprise (SOE) which manages a city block of startup supporter organizations in Zhongguancun 中关村, one of the most famous tech clusters in China. Among many other activities, it has a Global Incubator which runs a program designed to facilitate entry of overseas startups into China. They provide companies in their incubator coworking space, curated mentoring, and third-party business services, either charging a cash fee or purchasing an equity stake (3-10% equity in Chinese entity for up to 500,000 RMB).
DayDayUp (DDU) is a global entrepreneur community with a particularly strong investor network in China; their founder is also a founder of investor group GWC. DDU runs an Innovation Program for startups focused on four topics: Industry 4.0, Mobility, Healthcare, and Smart City. This program includes 12 lectures, 24 potential client or investor meetings, exposure via 3 demo days, and access to DDU’s coworking spaces. The program is free for ventures that meet the sponsor’s criteria (e.g. founder nationality). DDU aims to facilitate at least one deal with a client or investor by the time each participant graduates.
These are a subset of sponsored programs, specifically run by corporates for strategic reasons.
Microsoft Accelerator in Beijing is part of a global program launched in 2012. Since then, they have graduated more than 200 ventures in China. Over 80% went on to raise successful rounds, including 15 acquisitions and four IPOs. Participants receive Azure credits, Microsoft’s mentor network, and investor connections. Microsoft offers this 4-6 month acceleration program to about 10-15 companies per batch, taking no fees or equity from accepted applicants.
Startup Autobahn is a global innovation platform launched in 2016 by a consortium including Daimler, Plug and Play, BASF, Porsche and others. Their first China program last year focused on startups addressing mobility challenges. Over 100 days, nine startups received workspace in Beijing, executive mentoring, and investor connections at a concluding EXPO Day. The program distinctly provides startups a fast track to a substantive contract; all calls for applications originate from actual Daimler business units. Startup Autobahn takes no fees or equity.
Arm Accelerator is the sole accelerator of global semiconductor IP company Arm, focused on solutions based on artificial intelligence and/or Internet of Things. Launched in 2015, they have accelerated 89 startups to date. Their 4-month program offers elevated brand exposure, potential investor and customer connections, and access to Arm’s global ecosystem. Most uniquely, they offer deep technical expertise in software, hardware, and their integration. Arm Accelerator charges no fees but may take equity on a case-by-case basis.
Finally, many programs take equity in the startups they work with.
Plug and Play China is the Chinese affiliate of Silicon Valley-based Plug and Play, a global innovation platform specializing in bringing together startups, corporations, and investors. Launched in Beijing in 2015, they run various startup programs for corporate clients and make investments into startups themselves. Startups who join their platform can receive funding, mentoring, workspace, exposure at events, and access to an extensive global network of corporate partners. Plug and Play China has already invested in nearly 200 startups in its first three years in China, taking 3-5% equity for 300K-3M RMB.
Green Startups specializes in supporting startups that address environmental challenges. Since 2003, this team has worked with nearly 200 ventures from across China. Their 100-day acceleration program is organized into cohorts of 12 startups each and provides mentoring around product, customer, and investors. Graduates get preferential consideration from Green Startups’ own fund, which generally makes 1-3M RMB investments for 5-10% equity.
SparkLabs Beijing is part of SparkLabs Global, an international network of accelerator funds targeting early-stage ventures. Having just entered China last year, they are currently working with their first group of eight ventures in 2018. They offer startups their global network of investors, local business services, and most uniquely, dedicated mentors who coach the startups 1-on-1 over the course of six months. Accepted startups received ~$40,000 for equity stakes that vary by business.
These are just some examples of the organizations who seek to guide new ventures to their first round of funding, enabling them to build a market-ready product or solution. Of course, the journey does not end there.
Beyond Stage 3 lies what is euphemistically referred to as the Valley of Death. A whole slew of venture capitalists exist in Beijing to help entrepreneurs in this next stage. They are beyond the scope of this article but easy places to start looking include AngelList or Crunchbase.
To summarize, Beijing is big. And noisy. And full of resources! The trick is knowing where to look.
This two-part article highlights a few of the most active organizations in 2018 helping fledgling entrepreneurs in Beijing. This list is just the tip of the iceberg. There are scores of other organizations that I have not attempted to list here.
Perhaps the more salient point for entrepreneurs is that different organizations have different strengths and are appropriate at different stages of one’s journey. A clear understanding of your current stage will enable you to better choose your supporters.
The entrepreneur’s journey is at once terrifying and thrilling, even more so in an ecosystem like Beijing’s. May this guide help you—if only by providing a rational framework—to find the right resources to succeed!
Most entrepreneur support organizations described in “Stage 2” will continue to help startups well after incorporation and into “Stage 3.” For brevity, I do not repeat all these actors but many of them charge fees.
An earlier permutation launched in 2003 as the New Ventures China Program, supporting environmental SMEs, before shifting its focus to startups in 2013 as Green Startups.
For example, Zhongguancun Science Park published this Jan 2018 list of 191 “new incubation” organizations across Beijing.