How does the Internet startup scene in China differ when compared to that of Silicon Valley 's?
There is a very large scope of startup cultures and styles in China.
On one end of the scope, you have the guys inspired by SV. Those are small teams of younger people trying to apply Lean Startup by the book. They are very hardworking and as SV authors precognize they will try to always please their VCs. They believe in the power of a “tech scene “ with numerous events and meetings. I will say that Shanghai is the place for this and there is a very vibrant group making cool things there. Most people in this community graduated from top universities in China or abroad and are very eager to build interesting initiatives together.
On the other end, you have more classical Chinese businesses that tends to be very patriarchal in their management style, with larger teams and fewer technical innovations. They mostly won ‘t go to startup meetings or this kind of things. Even if they do, nobody will welcome them because they usually behave weird, giving around lots of business cards in a very formal way. The “cool “ guys in IT tends to dislike them as those Chinese entrpreneurs are not part of the “startup scene “ and don ‘t care really about it being sexy. Instead they are usually quite low-profile, working on strange services with UX that may make you burst out in laughing (90 ‘s BBS forums for middle-age women to share pics of their kids ??).
They play a very important role in the Chinese Internet though : bringing Internet services to people that doesn ‘t follow trends. Even grannies are tech-savvy in China, they just need something working to get started. This kind of businesses tends to be very profitable, even if you won ‘t see their IPOs anytime soon. This is because they don ‘t rely on financial valuation to earn money. For the most part, they have been making money from day one also because there is no funding available anyway. Their direct inspiration is not Zuckerberg or Jobs but Alibaba ‘s Jack Ma. They run their business family-style and are often well acquainted with local officials. They may also have good links with professors from smaller universities that can support them with staff of students. Go to Hangzhou, Wuhan or Nanjing if you want to meet those guys.
You have also other players in the Chinese ecosystem like the big historical web companies in Guangzhou or Beijing. Those have been working closely with the central government for a long time and are key names in China (like Sina or Tencent). They are also predators to small startups as they won ‘t hesitate to copy a growing service or app to make it one of their feature. Unlike in the US, acquisition is not an important business model for Chinese startups. You can not rely on hypothetical opportunities in China. Product cycle is too short and laws won ‘t back you.
They are other traits that may differ from SV especially regarding hierarchy and work ethics. What you should do if you really want to learn about all this is go to spend some time in China. To meet all those different business cultures, I will recommend the city of Shenzhen. While it is all about hardware and manufacturing, there is a huge variety of styles and players here, from low-cost shanzhai knockoff phones to state-of-the-art open-source hardware kickstarter startups and even the Taiwanese, biggest hardware manufacturers on the planet so far.
This very diverse mix will give you a good account of the incredible dynamics ongoing on China tech scene nowadays.
This text was originally published in quora.