Tai­wanese en­trepreneurs ‘don’t have the wolf in them,’ says busi­ness­man talk­ing star­tups

The China Post - - BUSINESS -

Pre­mier Li Ke­qiang called a State Coun­cil meet­ing on April 21 to dis­cuss how to pro­mote em­ploy­ment and en­cour­age en­trepreneur­ship. The con­clu­sions in­cluded: en­cour­ag­ing lo­cal au­thor­i­ties to sur­vey un­der­uti­lized spa­ces for use as low-cost startup spa­ces; of­fer­ing star­tups loans of up to NT$500,000; sub­si­diz­ing the 3 per­cent in­ter­est rate on the loans; and sup­port­ing farm­ers in set­ting up on­line busi­nesses. Also, uni­ver­sity or re­search in­sti­tute pro­fes­sors or re­searchers can take leaves of ab­sence of up to three years to work on startup ven­tures.

Fund­ing for th­ese Chi­nese startup am­bi­tions not only comes from the Chi­nese gov­ern­ment but also from the United States and pri­vate Chi­nese sources as well. MyTreat CEO Eric Hsueh, from Tai­wan, has jumped on the bandwagon.

Tai­wanese in Zhong­guan­cun

MyTreat is build­ing an on­li­ne­of­fline gift-giv­ing plat­form. Us­ing the site, a boyfriend in Taipei can pay for a cafe in Bei­jing to de­liver a fresh cup of steam­ing hot cof­fee to his girl­friend there. Hsueh works alone in Bei­jing at the 3Wcof­fee startup in­cu­ba­tor, while his tech­ni­cal team works from Taipei.

MyTreat co-founder, Chris Lu, re­lates that since Erich Hsueh re­lo­cated to Bei­jing last Novem­ber, his pet phrase has be­come “faster.” The Bei­jing 3W in­cu­ba­tor’s next steps are to get prod­uct on­line within three months, se­cure an­gel fund­ing, and pro­ceed to first-round in­vest­ment. Then, within two months of get­ting that money, ini­ti­ate the sec­ond round of in­vest­ment.

“Chi­nese en­trepreneurs get money from a strate­gic an­gle, to pre­pare for battle, and use money to max­i­mize the num­ber of users. In Tai­wan, they try to squeeze the most out of their own funds be­fore look­ing for in­vestors,” ob­serves Hsueh.

Sur­vivors Stand­ing on

High Ground

“Tai­wanese don’t have enough ‘wolf’ in them, but they are still well suited as co-part­ners in new ven­tures,” says Dan Dan, founder of 3Wcof­fee.com.

3W, which started as a cafe five years ago, now claims seven 3W Cof­fee out­lets, the per­son­nel re­cruit­ment plat­form lagou.com, In­ter­net con­tent provider 3W Mar­ket­ing, a head­hunter com­pany, an in­cu­ba­tor man­age­ment com­pany, and a ven­ture cap­i­tal fund un­der its um­brella.

The day Com­mon­Wealth Mag­a­zine met with Dan Dan, he had just re­turned from vis­its with in­vestors in Shen­zhen. He has a desk, but the baby-faced Dan Dan (whose full Chi­nese name is Xu Dan­dan), 33, prefers to work stand­ing at the com­puter. Work­ing with­out a sec­re­tary, he wipes dust off the ta­ble with a cloth him­self.

Prior to start­ing his own busi­ness ven­tures, Dan Dan was an In­ter­net in­dus­try an­a­lyst at an in­vest­ment com­pany that opened his own cof­fee shop out of the de­sire to have a cozy place for gath­er­ings in Zhong­guan­cun. Sorely un­der­es­ti­mat­ing the dif­fi­culty of run­ning a cof­fee shop, the four co-part­ners naively took on 170 in­di­vid­ual share­hold­ers who had con­trib­uted small in­vest­ments. But with too many no­table In­ter­net mavens in­volved, they were ashamed to shut down, and so the four co-founders ended up work­ing full-time, stick­ing it out for a year be­fore fi­nally find­ing their di­rec­tion and po­si­tion­ing.

First, Dan Dan en­gaged the ex­per­tise of a cof­fee mas­ter, and po­si­tioned 3W as a knowl­edge and in­for­ma­tion ex­change for In­ter­net groups, hold­ing 400 events a year. Their busi­ness card read, “3W, the In­ter­net Crowd.” And the crowd had cer­tain needs, which spawned such spin-off ven­tures as hu­man re­sources and head­hunter agen­cies.

They be­gan work­ing on an in- cu­ba­tor in 2013. On the strength of a num­ber of In­ter­net celebri­ties as share­hold­ers, and the idea that en­trepreneurs know best how to start busi­nesses, they se­cured in­vest­ment from Qinghua Hold­ing Co. and jd.com (Jing­dong Mall).

“We got a two-year head start on the rest of the field,” Xu Dan­dan notes. For in­cu­ba­tors, cost con­trol man­age­ment, in­clud­ing the en­tre­pre­neur guid­ance sys­tem and phys­i­cal space, is crit­i­cal. Dan Da told Com­mon­wealth that even ex­tra thought was given to the de­sign of the in­cu­ba­tor’s air con­di­tion­ing and light switches in the ef­fort to save elec­tric­ity.

“Now the en­tre­pre­neur­ial craze has bub­bled,” he notes can­didly, pre­dict­ing that the In­ter­net bub­ble will burst as soon as early next year and no later than 2017. Xu re­veals that while the 3W Group is val­ued at 2 bil­lion ren­minbi, he is ag­gres­sively ex­pand­ing and rais­ing funds to build re­serves so that “when the tide re­cedes, we must be sur­vivors stand­ing on high ground.”

“At least 95 per­cent will fail!” Xu pre­dicts. “But so what. That would be a good thing for this gen­er­a­tion,” be­cause “it is a time when those with­out any back­ground, with smarts, guts, and re­silience can make their mark!” says Dan Dan, the man from the An­hui coun­try­side, him­self em­body­ing the story of this gen­er­a­tion. Trans­lated from the Chi­nese by David To­man. Ad­di­tional read­ing se­lec­tions can be found at http://english.cw.com. tw.

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