Introducing 996.

At GGV, we care a lot about explaining China to the US. China’s tech scene changes so quickly that it can be hard to follow. Every week, we compile a terse, interesting email to keep you abreast of the important tech happenings in China. This is what people inside China’s tech circle are talking about, what Chinese reporters are writing about – and most of it is not available on English-language media outlets.

Why is it called 996?
Employees of Chinese tech companies are known for working 9am-9pm, 6 days a week.

Why should I care about China?
See above.

World's largest companies by market cap

How can I subscribe?
Click here. If you’d like to recommend this to a friend, they can subscribe at

I have suggestions/feedback.
Just hit the “Reply” button!

Below is the first issue of the newsletter. Enjoy and remember to subscribe!

– Zara Zhang & Hans Tung at GGV Capital


Issue 1, August 30th, 2017

A Big Deal
Baidu sold its food delivery business (Baidu Waimai) to for $800 million, bringing an end to the triad dominating China’s food delivery industry:

  • (backed by Alibaba) – around 36% market share
  • Meituan (the Yelp of China, backed by Tencent) – around 33% market share
  • Baidu Waimai – around 17% market share

Baidu Waimai was known for being more expensive than its competitors and more popular among higher-income white-collar workers (but how often do these people order take-out anyway?). As it repositions itself as a AI company, Baidu has reportedly been allocating less resources to its food delivery business, which wasn’t even mentioned in its Q2 earnings report.

Yet another industry – food delivery – has become a proxy battlefield for Alibaba and Tencent (both surpassed $400 billion in market cap two weeks ago).

A number
42.2% – the percentage of Tencent’s revenue that comes from online games.
According to its latest earnings report, Tencent’s mobile game revenue grew by 54% YoY exceeded PC game revenue for the first time in history. Much of this can be attributed to the explosive popularity of the game “Honor of Kings,”(王者荣耀) a MOBA (multiplayer online battle arena) game that has gone viral in China and been nicknamed “the national mobile game (国民手游).” It has an estimated MAU of over 200 million.

According to Superdata, Honor of Kings is currently the top grossing mobile game in the world, and made Tencent over $150 million in June. According to Tencent’s Q3 financial report, 42.2% of Tencent’s revenue came from online games. Despite WeChat’s ubiquity, social networking accounts for only 23% of its revenues.

A PictureAbandoned shared bikes in China

Aerial photo shows shared bikes lying on top of each other in an abandoned school field in Hefei, Anhui province, August 16, 2017. [Photo/VCG]

A Quote
I always say that our business is a “seafood business” – we have to make everything right in the morning, or it could go bad in the afternoon. Our business is very complex, with huge cash flows, inventory and long cycles. As a fast-growing company, we could fall into an abyss if we are not careful.

– Lei Jun, founder and CEO of Xiaomi, at Yabuli China Entrepreneurs Forum
A Buzzword
共享 Gòng Xiǎng (sharing
Chinese people have taken shared economy to a whole new level. Besides the well-known companies in ride-sharing and bike-sharing, new startups in this area are trying to popularize the sharing of portable chargers, umbrellas, iPhones, gym pods, BMWs, dorm rooms, strollers, stools, basketballs … All of them work by scanning QR codes with your phone which unlocks the product, and the rates are usually incredibly cheap. A magazine published a satirical article about a “boyfriend-sharing app.” Many took it seriously.A Commentary
Alibaba’s and Tencent’s market capitalization each exceeded $400 last week, making them two of the most valuable companies in the world. Here’s how they got here, and what it means.