How Entrepreneurship Has Changed How People Think and Live in China
Zhongguangcun, near the 4th ring of Beijing, was just a suburban area, not too far from the Summer Palace where the Qing Dynasty emperors took their excursions. Even twenty or thirty years ago, it was merely known as a market for cheap computer chips and hardware. Today, it has become the epicenter for entrepreneurship and innovation in China.
Zhongguancun Entrepreneurial Ave is better known as “the Sand Hill Road of China”. The analogy is actually a bit off — the Zhongguancun ave is full of startups while Sand Hill is known for the presence of VCs. Still, you get the gist of it: it’s about entrepreneurship. Famously, Chinese Premier Li Keqiang visited the Zhongguangcun ave in May 2015, only a few weeks after he announced “encouraging mass entrepreneurship and innovation” as the key to the central government policy dubbed “Internet+”, adding a new feature to his “Likonomics”.
A seasoned economist, Premier Li has solid economic foundations for this policy. To generate 7% growth on the $11 trillion Chinese economy and to maintain a sub-4% unemployment rate for the 1.3 billion population, China has to create at least 8 million jobs every year. That’s about 60% the size of the US economy but more than 4x the population. Without promoting entrepreneurship, this employment goal is almost impossible to achieve. Moreover, in the long run, without innovation, China’s productivity will not be able to keep up with the 7% growth target.
7.6 million people graduates from Chinese universities every year, more than 2x the 3.7 million in the US. However, the Chinese education system is famously strict and memory-focused. As the society grows opener to the western values, students become eager for critical thinking and creativity. Therefore, knowledge-sharing talkshows have gained significant traction. The Logic of Mr. Luo, which sounds similar to “logic” in Chinese, was created by Luo Zhenyu, a former Executive Producer of many well-known TV shows about business and economics on CCTV. It is a weekly show of 50 mins long, where he shares critical takeaways from a book, often on history, business, or technology. The subscriber community forms an ecommerce platform for special edition books, live lecture tickets, among many other products and offline activities. Luo’s show accumulated more than 5 million subscribers within 3 years and was valued at $200 million post-money at B round in Oct 2015. Other key opinion leaders have also started their own shows and ecommerce platforms, showcasing new thoughts on topics from business, history, travel, culture, antiques, or even debate.
As people upgraded their taste in food for thought, they are also upgrading their taste in food for appreciation. In fact, the high-end food sector has become so attractive that some Chinese expats even quit their wall street jobs for it. Sean is the founder of the first avocado-theme restaurant in Shanghai, who quit his hedge fund job in New York in 2014. Despite the offline base, Sean and the team are very active in creating online content for engagement published on their Wechat public account. Also, a high-end ice cream shop in Beijing has gone viral on Wechat moments. The founder is a former investment banker in New York, who also has a dream of making the best artisan ice cream. Besides, there are pure online shops such as Lechun, maker of artisan greek yogurt, founded by Denny who is a Blackstone alumnus. Even in wine sector, startups such as TasteSpirit provide professional content on wine-tasting, wine-making, and wineries & winemakers around the world, while also organize offiline wine tasting and lecture events. Co-founder of TasteSpirit, nicknamed NoTor, was an early team member of 36kr, the Chinese counterpart of TechCrunch, only to find himself obsessed with the wine business while pursuing his engineering degree in France, and later became a mentee of Bernard Burtschy, a famous wine critic.
Besides the fancier mental and physical intakes, people are also embracing a healthier lifestyle. In fact, as major Chinese cities advanced into middle-income status, people are more aware of their fitness and picking up an exercise habit. FitTime and Keep are both very popular fitness apps, which users can participate in progressive workout sessions, track workout histories, and share workout achievements and milestones in the community or on Wechat. Keep has gone so viral that its user base reached 30 million in roughly one year, recently raised $32 million in the C round without disclosing valuation.
As the entrepreneurial spirit escalates, it is spreading into deeply professional sectors such as healthcare and industrials, transforming the old-fashioned systems.
One of the most pressing pain-points of the healthcare system in China is the access to doctors. Good hospitals are all concentrated in major cities and the amount is very limited. Logistically, it is almost impossible to serve the needs of all the people, especially those living in rural areas and minor cities. Spring Rain Doctors is a mobile app that connects patients to doctors from hospitals of Level 2 and above. Patients can either look up their symptoms on the online directory, or can also ask questions which are guaranteed to be responded within 3 minutes. Since its launch in 2011, it has attracted 90 million users and 410,000 doctors, with more than 330,000 questions answered on a daily basis. Inspired by Spring Rain, many startups also emerged to focus on different verticals within the healthcare system, establishing an evolved ecosystem.
Because of the fast industrialization, air pollution has been a headache for China for many years. Cities are covered by smog that is more toxic than cigarette smoke, so more and more people are showing respiratory systems or even lung cancers. If no measure is taken, life expectancy can be shortened by as much as 5 years. Bayeco, a Global Cleantech 100 company according to Cleantech Forum San Francisco, was founded by a small team of engineers with the most cutting-edge volatile organic compounds (VOC) technology. Recognized by the Chinese government, Bayeco is taking the lead to upgrade factories of PetroChina and Sinopec nationwide to clean and sustainable standard. Last month, Bayeco joined as a leading industry member of the US-China Eco-partnership, a 10-year cooperation framework currently lead by the US Secretary of State John Kerry and his Chinese counterpart State Councillor Yang Jiechi.
With the help of technology and innovation, lifestyle in China has witnessed a steep curve of changing. The curve is getting steeper and steeper, as increasingly more people are becoming entrepreneurial. As someone who spent years in both China and the US and had experience in both global economics and the tech industry, I am fascinated by how entrepreneurship is changing people’s lives and its implication on a macro level. It would be my pleasure to share more interesting observations.