Rise of the Silicon Dragon

The rise of the growing tech industry in China, like many other industries here, is expansive, set to one day become a world leader. Although it’s yet to overtake the US’s Silicon Valley, there’s good reason to consider China a contender to be the world’s next big tech centre. Talk met up with Rebecca Fannin, author of Start-Up Asia to discuss the rise of Chinese tech.

How do you think the business environment in China is different from Silicon Valley?

There’s more of a developed entrepreneur mentality and talent set in Silicon Valley than there is in China; there’s more experience. There’s a lot of raw talent in China, but there’s just not the experience and sophistication in how to run a lot of start-ups. In Silicon Valley, you have so many tiers. Here, you’ll meet people who are onto their third and fourth start-up. The whole idea of the serial entrepreneur has been a pattern in Silicon Valley, whereas it’s only just developing here in China.

How are Beijing and Shanghai different as tech centres?

When I first started covering China, all the venture capital firms (VCs) were in Shanghai and all the tech entrepreneurs were in Beijing. But now some of the VCs have moved into Beijing. There are also more start-ups in digital media and entertainment in Shanghai, whereas Beijing is more hardcore tech. Still, both have really good talent pools because they are fed by universities like Fudan University [in Shanghai] and Beijing and Tsinghua University [in Beijing].

Which country has the greatest potential to house the next Silicon Valley?

I think China has the greatest potential and then probably India after that. India is at least five years behind China in the tech start-up scene. It’s interesting that you see some of the same venture investors that were in China first move into India and now into other markets like Vietnam, which I highlight in my book [Start-Up Asia]. I profiled a lot of Vietnamese entrepreneurs who are up and coming, real scrappy entrepreneurs. They’re a bit like the first wave of Chinese entrepreneurs; they sort of remind me of where China was eight years ago.

What do you think is the biggest hurdle that China has had to overcome to get to the level of Silicon Valley?

I think it’s one of managerial talent; the innovation talent is here, but it needs to be encouraged more. There needs to be more confidence in it. China is getting over the copying mentality fast. Everywhere I go people are talking about China innovating, not just China copying.

What’s one of the more striking innovations you’ve seen lately?

Well, there’s Xiaomi (www.xiaomi.com), a smartphone company here that’s an iPhone competitor. And everyone talks about Tencent (www.tencent.com). China is [also] on the rise in terms of patents. For patents, China currently ranks fifth in the world for [patent] applications. The US is still number one with one third of the world’s market share, but China has risen very rapidly in the ranks.