China sends 350,000 students to America every year. America sends about 9,000 to China every year.
That’s about the same we send to Costa Rica every year.
This is the world’s second-largest market and will soon be the world’s largest market.
Americans on average just do not know China.
That’s Benjamin Harburg, he’s managing partner of MSA,
a Beijing-based venture capital firm that's invested in Uber and Mobike.
I’m at East Tech West, the first of its kind invite-only event
that examines China’s increasing role in the world of technology.
The Chinese know up and down most of the major U.S. tech companies.
Even folks in Silicon Valley, even a few months ago,
probably wouldn't have even heard of a company like ByteDance.
ByteDance is the Chinese tech company behind Toutiao, a popular content sharing platform,
and Tik Tok, a video platform.
It’s become one of the world’s most valuable startups and it has a valuation of $75 billion.
Just take a look at the list of world’s biggest unicorns, companies valued at more than a billion dollars,
a number of them are in China.
The Chinese understand what’s going in America and how they can
adapt those business models for their local market, which we’ve seen obviously plenty of.
But the Americans have to date, had this attitude that there’s nothing in China I want to replicate,
the Chinese market is protectionist and therefore I’m not even going to try and enter it,
which I think is the wrong approach.
Historically China’s been a hard market to tap into.
You can’t just launch an app in China and think that it will be successful, a lot of people will sign up.
You have to do a lot of local services, local customization around that for that to be successful.
This is Alain Lam, Managing Director at Credit Suisse.
He says one of the reasons China’s impact on global tech is growing isn’t just its massive population,
but also the amount of capital that it's been spending on research.
They have been spending a lot of capital and with the government support in terms of tax breaks,
in terms of subsidies, in terms of other grants, to help advance the industries in a massive way.
With the support from the government, with the capital that they have,
I think it has enhanced their positioning in terms of innovation.
For example, Xiaomi being able to grab a pretty significant market share in India,
that’s part of globalization.
China’s Xiaomi has become one of the world’s top-selling smartphones
and it’s currently India’s most popular smartphone.
In fact, Xiaomi now plans to have 5,000 stores in India by the next of 2019.
So how did Chinese tech companies get here?
Tencent, Alibaba, huge global portfolios.
Harburg says the evolution started when Chinese public tech companies went public, like Alibaba and Tencent.
Then, Chinese private companies started investing abroad.
Like Didi investing in the ride-hailing company Careem in the Middle East.
And most recently, Chinese companies are going global organically.
If you can make it out of the gantlet of China, especially either as an entrepreneur or as a business model,
you’re so battle-tested, that when you come into a more emerging market,
one that’s maybe a few years behind China in terms of its competitive landscape,
capital availability things like that, huge swaths of the market can be gobbled up relatively quickly.
And so I think we’re just at the tip of the spear in terms of Chinese companies going global.