Episode 35: Jane Sun, CEO of Ctrip, on Running Asia’s Largest OTA

GGV Capital’s Hans Tung and Zara Zhang interview Jane Sun (孙洁), the CEO of Ctrip, the largest online travel platform in China which is listed on the NASDAQ. It’s current market cap (at time of recording) is around $23 billion.

Jane has been at Ctrip for 13 years. Prior to becoming CEO in Nov 2016, Jane served as COO of Ctrip for four years and CFO for seven years. Before joining Ctrip, Jane worked at Applied Materials in the US as the head of SEC and External Reporting Division. Prior to that, she worked with KPMG as an audit manager in Silicon Valley for five years. Jane received her bachelor’s degree from the business school of the University of Florida, and LLM degree from the Peking University Law School.

Jane discussed her journey from studying abroad in the US to one of the one of the top female leaders in Chinese tech, her daily routine as the CEO of a New York-listed Chinese tech company, and her advice for young people with cross-cultural backgrounds.

This episode also features a bonus interview with GGV managing partner Jixun Foo, who led the firm’s investment in the online travel search company Qunar, which merged with Ctrip in 2015.


HANS TUNG: Hi, there. Welcome to the 996 Podcast, brought to you by GGV Capital. On this show, we interview movers and shakers of China’s tech industry, as well as tech leaders who have a US-China cross-border perspective. My name’s Hans Tung. I am the managing partner at GGV Capital, and I have been working at startups and investing in them across the US, China, and other emerging markets for the last 20 years.

ZARA ZHANG: My name is Zara Zhang. I’m a Marketing Manager at GGV capital and a former journalist. Why is this show called 996? 9-9-6 is the work schedule that many Chinese founders have organically adopted. That is, 9 a.m. to 9 p.m., six days a week.

HANS TUNG: To us, 996 captures the intensity, drive, and speed of Chinese Internet companies, which have produced many growth miracles over the last decade.

ZARA ZHANG: Also, I highly recommend joining our listeners’ WeChat groups and Slack channel, where you can connect with like-minded people interested in tech in China. We organize regular offline events across the world for our followers. You can join these by visiting 996.GGVC.com.

HANS TUNG: On the show today, we have Jane Sun or 孙洁 in Chinese. She’s the CEO of Ctrip, the largest online travel platform in China which is listed on NASDAQ. It’s current market cap is around $23 billion dollars. Jane has been at Ctrip for 13 years. Apart from becoming CEO in November 2016, Jane served as COO of Ctrip for four years, and before that CFO for seven years. Before joining Ctrip, Jane worked at Applied Materials in the US as the Head of SEC an external reporting division. Prior to that she worked with KPMG as an Audit Manager in Silicon Valley for five years. Jane received her bachelor’s degree from the Business School of the University of Florida and LLM degree from the Peking University Law School.

ZARA ZHANG: Just yesterday Ctrip announced its financial results for the fourth quarter, and full year end of December 2018. Net revenue for 2018 was $4.5 billion, a 16% year on year increase. And total GMV for 2018 was $105 billion, which is around a 30% year on year increase. Welcome to the show, Jane.

JANE SUN: Thank you.

ZARA ZHANG: Most of our audience is already familiar with Ctrip and you have been part of the company for over a decade. Could you share with us three things you’re most proud of about Ctrip that most people may not know?

JANE SUN: Yes. First of all, it’s the growth of the company. When I joined the company, we only had about $500 million market cap and today we’re exceeding $20 billion in the past 13 years. So, I’m extremely proud of our growth. And secondly is our expansion in the global spaces. When I joined the company Ctrip was only a very small Chinese online travel company. And now in terms of GMV we’re already the largest in the global space. I’m extremely proud of the achievements our team has made. And lastly is our initiation in terms of protecting the female leadership. Because I’m one of the very few CEO’s in major Internet companies. We put a lot of emphasis in helping female leaders to nurture them and to make sure they thrive in our company.

ZARA ZHANG: I read recently in one of your interviews that you actually provide the option to pay for some of your female employees to freeze their eggs in case they want to preserve the option of working and having a child at the same time.

JANE SUN: Yes, very progressive company policy. And we are the only company who offer this benefit to our female employees. Our female employees really are very excited to have this protection for their career path.

HANS TUNG: I’m going to take the interview to an earlier point in time. When you went to the US you were already in college in China. Why did you go to the US for business school? You started with the law school first, and then you went to US for business school. Why did you decide to do that, and also decided to go to the US for it?

JANE SUN: Yeah, when I first came to the United States, I was a sophomore in Peking University Law School. In the Chinese system law school is a undergraduate system. But in the United States law school is a graduate school. My original plan was to go to the business school first, and then go to law school next, and get my PhD as the third step.

HANS TUNG: PhD, like every good Chinese graduate student wants to make their parents proud.

JANE SUN: Yes, absolutely. But in my third year of business school at the University of Florida I interviewed with a Big Four accounting firm and they gave me an offer. So, I thought, oh, let me make some money to save enough money so I can go to the master degree. That’s why I started to work with KPMG Silicon Valley office right after I graduated from University of Florida. And then opportunity comes when my husband became the first CTO of Alibaba in 2000, and our board asked me to join Ctrip as the CFO of Ctrip. So, we moved our family back to China to take on these challenges.

HANS TUNG: John went to Yahoo. Your husband went to Yahoo in Silicon Valley.


HANS TUNG: So, they brought you to Silicon Valley as well?


HANS TUNG: Was that your first exposure to internet.

JANE SUN: Yeah. We are very blessed for the opportunity because when we went to school the Cultural Revolution ended. And when we went to college Deng Xiaoping opened the door so both of us were able to go to the USA to study. When we finished the school Silicon Valley took off. John joined Yahoo when there was only 46 employees in the company. And then after four years we got a phone call with a very good friend of ours to invite him to join a very small company called Alibaba. And that friend is Jack Ma. John left Yahoo when the stock price was about $200 to $300 and joined a smaller company called Alibaba. I always feel both of us are very blessed for the opportunity. I feel a tremendous responsibility to bring up the next generation of the leadership and give them as good an opportunity as possible going forward.

HANS TUNG: Right. But when he first suggest to you that he must go from a big company Yahoo, which was the star at that time, to join this little small company in Hangzhou, in the middle of nowhere, what was your immediate reaction?

JANE SUN: We have known Jack for a couple of years. So even before John joined Alibaba, whenever we came back to China John always talked to the engineers the Alibaba and tried to help out as much as possible. And we always see Jack as a very good friend of ours and tried to be helpful. And I remember one day John got a phone call from Jack and said, oh, you already finished your fourth year with Yahoo, and I got VC money. Softbank invested $20 million in Alibaba. You have to join us. John believed in the vision Jack had. Although I only had my first baby. She was born in March 2000, and John joined Alibaba in May 2000. But I thought to be a good wife I always should be very supportive of him, so he joined Alibaba. It was during a very difficult stage of Alibaba because Softbank invested $20 million in the company. But the company was growing so fast. So, when John joined, he told me Alibaba only had $5 million left in the bank.

HANS TUNG: Spending a lot of money.

JANE SUN: Yeah. It has been a long way, and we are extremely proud of the achievements Alibaba team has achieved.

ZARA ZHANG: And how big was Ctrip when you joined, and what made you believe in the Ctrip vision?

JANE SUN: Yeah, I also asked myself. First of all, I asked three questions. First of all, should I invest my youth in the United States or in China. And at that time USA, the GDP growth rate was about 2% and China was growing anywhere between 8% to 10%. So, when the economy is growing so fast it presents a lot of opportunities for the young employees. When I joined Ctrip I became one of the youngest CFOs in the market. That’s the first question, should you remain to be in the USA, or do you want to go back to China. The second question is, if you want to invest in China which industry will give you a very good opportunity to grow. And I always tell myself, if I joined a tobacco company or alcohol company, the margin for these companies is very high, you can make a lot of money. But in a way it’s not very healthy. I try to tell myself that I need to join a company that is very healthy, very green, brings happiness to the people. I believe travel not only brings happiness to individuals, to families, let young kids learn, it also brings global peace when we travel around the world. I choose to invest my time, and energy and my youth in the travel industry. And the third question is, if you want to invest yourself in the travel industry, which company has the best opportunity to win. And when I talk to our team, I feel very strong that this company is very humble, down to earth, hardworking, and they have the best opportunity to win. So, these are the three things I considered when I decided to join Ctrip as the CFO of the company. It has been a very good track for me.

ZARA ZHANG: What was it like to transition from CFO to COO and then CEO? What kind of lessons did you learn about how these leadership functions can work together well?

JANE SUN: When I was a CFO the company was very small but growing very fast. So, whatever that is not taken care of by our executive teams, I would just jump in and fix it. After a couple of years our board feels that I already was doing the COO’s position, so they promoted me to be the COO. And then three years ago when James talked to me, and he wanted me to take on more responsibility as the CEO of the company, I told him that we just finish two major deals. One with eLong, one with Qunar. And I thought our team needs to be stabilized, to finish the mergers and acquisitions before I took on the new responsibilities. I waited for one year, and then two years ago we made a very smooth transition to the CEO position. So, for me, my growth track is that when I’m in one position I already see what else needs to be done. And without the title I was already doing a lot of these things. So, for our young leadership team, my advice to them is always go beyond your title, go beyond your scope. Invest your time and energy in the next level, and then you will spin out. My title, my scope is never a limit on what I do. Whatever is good for the company I would just jump in and get it done.

HANS TUNG: A lot of people outside of China have stereotypes of how Chinese women behave. And yet you were among the very first that runs a major Chinese Internet company, or a major Internet company worldwide, period. What kind of challenges did you have to overcome in order to become in such a position and do such a great job? What were the opportunities that you sought to prove yourself, to show that you can take on more?

JANE SUN: I think as a female leader I try to be authentic. I think females themselves has a lot of stress. You don’t have to act as a male to be successful. So, a couple of strengths we have is that, first of all, we always put the team first. Very willing to make a personal sacrifice in order for the team to be successful. And I think that’s a great strength when you become a high level executive in a company. The second thing is females are also very good with putting yourself in others’ shoes. When I’m in a negotiation I always try to see for this deal what we can bring to the other side. If I were the other side, what they would like to have. If you put yourself in other people’s shoes, it’s very good for you to make a deal that is win-win, rather than I kill you or you kill me type of one-sided deal. And the third thing I feel in female leaders that’s very strong is the communication and team building skills. So, a lot of times we’re very sensitive, we understand what the teams need instead of just focusing on one thing. We try to bring to the table a comprehensive solution so that both the teams, career paths, companies interests, shareholders interests, our customers interests are well taken care. I think female leaders have inherited strengths, and we have to use our strengths to be successful in the business world.

ZARA ZHANG: What is it like to run a public company listed in New York from China? What is your typical day like?

JANE SUN: The schedule is very demanding. Normally when I’m not travelling, I try to get to the office at around 7 to 7:30. I finish all my own work, and my direct report if I need to have one-on-one with my director for report, I normally invite them for a breakfast meeting at 8 o’clock. And from 9 my schedule is half an hour for meetings back to back, all the way until maybe 6 to 7 o’clock. And in the evening I try to pack up all the work papers I need to read and bring it home. If I’m not travelling I try to have dinner with my family. When the kids are young I try to help them with the homework. Now they are old enough so when I’m working they’re doing their homework. And from 9:00 to 12:00 am or 1 am I schedule my overseas phone calls with Europe, with the United States, with NASDAQ, etc. That’s how I try to balance my work and life.

HANS TUNG: Do you work five days a week or more than that?

JANE SUN: More than that. I think in China a normal Internet company is 996, meaning from 9 o’clock to 9 o’clock times 6 days. Entrepreneurs, a lot of us is 7-11-7, so seven o’clock to 11 p.m., seven days non-stop.

HANS TUNG: Some of our listeners like to ask the question, how can you be efficient when you work long hours? Implied in that question is that you can either be efficient or you’re inefficient and you have long hours. In your mind, how do such entrepreneurs can become both efficient and still work long hours?

JANE SUN: I think efficiency is very important, so I try to run a half marathon on the weekend, and every year my husband and I try to join two marathons a year. To be healthy is very important. The second thing is also to train your team so that they can be as efficient as you are. And the third thing is arrange your time very wisely. When I’m in a car I try to listen to a book. When I’m in the office I try to arrange the meeting so there is no moment wasted.

ZARA ZHANG: Could you tell us about the Baby Tiger program at Ctrip to encourage internal initiatives? And how do you make sure your overarching goals as a company are effectively communicated to all your employees?

JANE SUN: As the company is growing bigger and bigger, we consistently think about what is the best way to energize the company. One initiative that we took is the Baby Tiger program. Basically, our employees are encouraged to bring new ideas, new business plans to us. And we’ll give them funding, personal resources, and then let them to innovate. For example, one of the employees he is very young, right now he is only 26 years old. And he is the CEO of Zhixing 知行火车票, which is a train business unit. He wants to use this business unit as an anchor and then add your ticket to it, add hotel business to it. He is only 26 years old. So, when we ask him how much money, how long he needs, he says, I need 2 million RMB, six months, six people to prove I’m successful or not. If not, you can close out. And it only took him one month to prove that the volume exceeded 10,000 per day. And last year they delivered $1 billion to the company. So very successful young people, very driven, smart and innovative. We want to encourage our young employees to step up and take on more responsibility.

HANS TUNG: In the last 14 years since you have joined the company you have helped to increase the value of the company by more than 50X. You’re very successful and extremely articulate. What’s your drive? Why are you still working this hard and this efficiently six to seven days a week?

JANE SUN: A couple of things. I think first of all I have two young kids, and I think mothers are the best role models for their children. I cannot tell them to study hard, to be independent, and meanwhile I’m relying on my husband, not to work and watching TV. I think if you want your children to grow up and rely on themselves to be independent fathers and mothers are the best role models for them. Secondly, I think I’m so blessed for the opportunity as we discussed. My grandmother was very smart but during her age China was in the Second World War and they escaped from one city to another. And my mother is also very smart, she was a chemistry engineer. But they suffered from the Cultural Revolution. And when I went to school the Cultural Revolution ended. When I went to the college Deng Xiaoping opened the door. When I finish college in the United States Internet took off. And when the Internet bubble busted in the Silicon Valley China took off. So, every step we made we were extremely blessed. Our generation is extremely blessed. For me, every day I’m so grateful for my professors, for my parents, for Deng Xiaoping for everything we have. For me, the only way you can return these favors is working hard and create the opportunities for the new generation so they can be very successful. They can step on your shoulder and create a new enterprise that becomes 10X as big as today’s Ctrip.

HANS TUNG: Right. So, you feel that this is your calling.


HANS TUNG: A strong sense of Shiminggan 使命感.


HANS TUNG: Ctrip has made many strategic investments into various startups in China and outside, including investing in the GGV portfolio Tujia, merging GGV portfolio Qunar, and many other companies in the travel space. You also invested in companies such as MakeMyTrip in India, as well as Boom Supersonic in the US. Can you talk about examples of synergies that you hope to achieve through these investments, and how did you decide that you want to make investments beyond China? And what do you look for in these startups when you are making investment in them?

JANE SUN: We hold very high standard for our acquisition target. There are three principles we adhere to. The first one is it needs to closely relate to the travel industry. There are lots of opportunities outside of travel, but we are very much focused on the travel industry. The second thing is we only are interested in making investment in the winners, number one or number two in each vertical. So hardly we make an investment in the number three in the industry. We invest in winners. And the third thing is, no matter how good a company is the valuation needs to make sense. It’s very difficult for us to make a move because you are looking for the number one, yet the price cannot be too ridiculous. If you look at our investment to Wing On, which is the number one travel agency in Hong Kong, it took us six years to finally close the deal. It was during the financial crisis when we took the opportunity and made the investment. If you look at our investment in Home Inn, again, it was during the financial crisis in 2008 and 2009 for us to do that. So, a lot of company, if they are so good, we need to be very patient. We need to be confident that we’ll be able to achieve one plus one equals five type of synergy, then we will make a move.

ZARA ZHANG: Since Ctrip is a travel company the business is inherently global. In the Q4 of 2018 revenue generated from international business accounted for 30% to 35% of the company’s total revenue. What do you hope that number to be in five years and which region will you prioritize as you go global?

JANE SUN: In five years I hope the pie will be 50% domestic and 50% globally. We move to the global places very methodically. At the beginning we only do Chinese people travel within China. And the second step is Chinese people travel within the Greater China area. And the third step is Chinese people going to Asia, and then the rest of the world. We’re pretty much finished, the layout for Chinese people outbound. Now we’re looking at the foreign people travel to China, because our inventory in China is very strong, product offering is very comprehensive. And the last step probably will be foreign to foreign, so a foreign person travel to a foreign land. We will make our move very methodically every year to achieve the best successful rate.

HANS TUNG: We all know China’s outbound travel market has been growing rapidly. In 2018 over 140 million Chinese people traveled overseas, and these collectively spent over $120 billion total. However inbound tourism in China is much smaller, with only 30 million tourists visiting China last year, and only a fifth of those are outside of Greater China. How important do you think is inbound tourism for Ctrip, and what kind of efforts does it make sense to help China become an easier destination for other people to come?

JANE SUN: I think China offers a great product offering for the foreign friends. We work very closely with the government to try to increase and attract the inbound customers. There are a couple of things we can do with the government. First of all, we need to make the visa application very simple. Have an app mobile maybe will be much better than having the foreign friends to lining up in the embassies in San Francisco or New York. That’s the first thing. The second thing is direct flights from San Francisco to China, from London to China. That’s also very important. The third thing is having a China welcome program so when people enter into China, we need to make sure there are English signs and people feel they are very welcomed. And I think if we focus on what would interest the foreign friends, we’ll be able to make a great move on inbound customers.

ZARA ZHANG: What is your advice to younger people with cross-cultural backgrounds who have lived across both the US and China just like yourself?

JANE SUN: I always tell my children that in order to be successful they need to look at, first of all, what they are passionate about. You can be a lawyer, you can be a hairdresser, but whatever you do you need to feel passionate and try to be the best in your vertical. “可以是律师,也可以是理发师”. Their passion is very important. The second thing is what they are good at. If you have a bilingual bicultural background that’s very rare. I think these kids will have very good opportunities working with multinationals, doing business in English speaking countries as well as Chinese speaking countries so that’s very good. The third one is they also need to ride on the wave. For example, right now Internet is very big, mobile is very big, AI is very big. These industries obviously will offer great job opportunities for the young people. But manufacturing probably is not as fast growing as the other. Mining industry is not as fast growing as the other. To ride on the wave is also very important for them.

HANS TUNG: As you grow your international business the demand for talent that’s multicultural is also greater. What type of employees do you look for to help you do that?

JANE SUN: We try to look for, first of all, bilingual bicultural people. We have a Global Leadership Program hiring students who are from China originally, study, or live and work in Silicon Valley, New York, LA, or Europe, and are willing to come back again to work in China. I think these people will have a very good career path in Ctrip.

HANS TUNG: And many of them are listeners of our 996 podcast. That’s why we encourage everyone who is interested to apply to work at Ctrip. Lastly I’ll ask you a bit more controversial question, which is that some of our listeners from Washington DC have made the claim that it’s not easy to find a Chinese company traded in the US a New York Stock Exchange or NASDAQ, that’s completely transparent, that can share even working papers of accounting with US regulators. This is a tricky touchy subject with the Chinese government as well. What’s the best way for a Chinese company that’s listed overseas to navigate through that?

JANE SUN: I think China is growing so fast. The analogy I hear a professor used was very good. China is like Yao Ming when he was 10. When Yao Ming was 10, you look at him, he was already much taller than anybody else. So, if you expect teenager Yao Ming to behave like an adult it’s a little bit too difficult for him. But he is learning. China is learning. Chinese culture is a little bit more reserved than the American cultural. Little teeny kids in the United States learn how to do PPT, how to do presentation very well. In China when I was in law school in China, we haven’t done any presentations before. China needs to learn to be a global citizen very fast, because much is given, much is expected. As the second largest economy in the world, the government, the community, the schools, and enterprises likes Ctrip, all need to take on the responsibility to grow our young people, to grow our company to be able to manage the expectation well. But on the other hand, for the global places, they also need to learn China a little bit better. I saw millions of students from China are very interested in learning in the United States. If Trump issued a visa, I’m sure there will be more Chinese students going to study in the USA. Yet I saw very few students from the United States, Germany or UK coming to study in China. It has to be a mutual way. Chinese people need to invest more, understand the US rules and regulation, understand the culture in a western country. But the western countries also needs to invest a little bit more, try to understand the 2000 years of Confucius and the industry. Then I think a lot of misunderstanding will be eliminated. And I’m very blessed by the opportunity to have the opportunity to study in the law school in China, and also to study and work in the USA. And I’d very much like to be a good bridge for these two countries.

ZARA ZHANG: I think travel also plays a big role in enhancing that mutual understanding.

JANE SUN: Very much so. We just launched a new product today called Zhuangyou 壮游. Last summer my husband and I took our children to visit Italy. When we were in Rome we taught them about the Roman history, how two kids with the wolf started the city. And then we took them to the Santa Maria di Leuca the medieval town and we thought them about the reform in the religion. And then we went to Florence and we taught them about the Renaissance. When I come back the kids just learned so much along the way. The Confucius’ teaching is it is better to travel 10,000 miles than to read 10,000 books. When I came back I talked to our product team, and I thought there were so much education we can do along the way. So, we launched a product and we will have professors, experts in each destination. And before we send these children, we will let them read these books, and then let them touch it. When they come back, they can share their stories, what they see, the pictures, and I think they will never forget about it. And these kids will be such good global citizens rather than having only the view from China to the world. Now and they will know, wow, outside of China there are so many people similar to Chinese people yet so different. I’m very positive that travel will enhance the international exchange and promote global peace.

HANS TUNG: Yes, we absolutely agree.

ZARA ZHANG: And now we’re down to the final round of quickfire questions. Who is the entrepreneur you admire the most and why?

JANE SUN: There are many people I admire. I think Bill Gates foremost. I think he built such a successful company, yet during his peak time he contributed so much to Africa, to the rest of the world. And I have very high admiration for him.

ZARA ZHANG: What’s something you read recently that you recommend?

JANE SUN: I enjoy reading a lot. There are many books I’d like to recommend. The classic book is From Good to Great and Built to Last, Jim Collins. And then leading enterprises, From Zero to One, exponential enterprises. And then a very good book I enjoy to read is The Better Angel of Our Nature, talking about the confidence that violence is decreasing and human race progresses.

ZARA ZHANG: What is your favorite travel destination?

JANE SUN: Oh, I have so many. For natural scene I love Africa. It’s just so beautiful. I think humans migrated from Africa. Africa’s wonderful. We climbed up the mountain Kilimanjaro in 2014. And in terms of history I love Egypt, and we just went to Israel, Jordan, and I think the history over there is so amazing. I highly recommend these places to our peer travelers.

ZARA ZHANG: What do you do for fun?

JANE SUN: I have many hobbies. Athletics. We ski in the winter, or we dive in the summer. On the weekends we run marathons. Anything that is fun and adventurous I’m very interested in.

ZARA ZHANG: Cool. Jane, that’s all we have for today and thank you so much for your time.

HANS TUNG: We appreciate your time. Thank you.

JANE SUN: Thank you so much for having me.

ZARA ZHANG: Next you’re going to hear a short interview with our managing partner at Jixun Foo who led GGV’s investment in Qunar, an online travel company that merged with Ctrip in 2015, in a deal that was valued at close to $10 billion. Jixun Foo could you please tell us about how you first met Qunar and how you came to invest in them?

JIXUN FOO: It’s kind of a long story. I first met Fritz back in 2005, 2006 at a China Wall hotel. A lot of us have our meetings in China Wall back then.

HANS TUNG: That’s right.

JIXUN FOO: So, I met Fritz Demopoulos back in 2005-2006. He was carrying his briefcase and telling me about this metasearch play and travel search. I thought it was an interesting story, but I wasn’t paying a lot of attention because at that time Baidu just went public. I thought that, hey, search is search. There’s a big search company already just gone out, a couple billion dollars at that time. Why would there be a marketplace for a vertical search? So, I wasn’t paying a lot of attention to it until they did their series A, they did their series B. I still have questions on the value of a vertical or metasearch. But during the process I got to know CC, Zhuang, the co-founder. I also got to know Fritz and the two of them really well. It was over a three to four-year period. And by 2007 and 2008 I saw that they were doing something quite right actually. Because how flight information got democratized because it’s digitized, and tickets became e-tickets versus physical tickets. That was an opportunity at that time for them to actually help consumers acquire the cheaper possible tickets. That was back in 2007-2008. My first meeting with Fritz was in 2005-2006, and when I saw that their search for flight actually started to take off. And the whole momentum, because of the change in the market as well back in 2007-2008 if you recall it was the whole financial crisis, actually consumer becomes more price sensitive. Qunar got quite a bit of a boost in terms of their growth. One, because of the market. Two, because of the digitization of the tickets.

HANS TUNG: I can offer another perspective where Qunar is in my entire portfolio a deal that I missed. And I can tell you why I missed it. Like Jixun I also met the company in 2005, I met the team, but back then there were only two websites in China to travel. One is eLong and the other one is Ctrip. So why do you need a price comparison website? It didn’t even work most of the time when you had two sites to look for everything. And, for instance, even though he’s a old China hen he’s still not local back then. And you worry that if a CEO is from outside of China can it really localize and really embed into all the SMBs that companies that sell tickets in China as travel agents. And then thirdly, the Chinese government and Chinese SOEs in travel sector move very slowly. When would the airline have e-ticket. It seemed like it would take a long time and they don’t move that fast. Those were three things that most people saw and passed. I think what Jixun did well was that, as the sector was changing, China’s government and the major airlines in China were issuing e-tickets much faster than anybody thought was possible. And then more travel agents were getting online and want to be online. And that depends on the travel sites with all the price information. During the financial crisis a competitor to Qunar was acquired by a foreign company so Qunar was left alone to be able to focus on dominating the China market and not be distracted. So, I think Jixun made a right call to make an investment but at that time the VC passed a deal, not seeing how the conditions to say no have actually changed, and therefore you need to go back because this actually could be a big opportunity.

JIXUN FOO: Right. Despite the investment that I made there was an overhang on the question on Fritz and CC together, can they truly grow a company from 60 people, to a few hundred, to a few thousand. So as the organizational complexity grows can they, as a combination of a foreigner versus a local, can they really run the organization. I think that question continues to be there. And I think the other underlying thing for me which later brought to the involvement on Baidu, was that the metasearch service in itself is actually a fairly thin layer in terms of the value, because you are providing a verticalized comparison engine for a very specific sector. On the front end you still have Baidu which is the global search engine. And now you have the OTAs that are laying below.

So, you are really playing the arbitrage between the robust search and the OTAs. And that value is always a little bit of that overhang for me. As the company evolved into 2011, I realized by that time that something has to happen. Because if you look at what happened very close to that, Kayak and SideStep post-merger was also sold to Priceline. We knew at some point that the value of this company can be capped. And so, the one thing I have to do is to figure out how to make the company great. We actually started a conversation with Baidu, and Ctrip, and so on. The involvement of Baidu into the company was strategically important because it effectively made Qunar starting in 2011 the de facto gateway for all travel search. That positioning helps us to transform itself beyond just a metasearch play to an OTA play. And therefore in 2011 through 2013, prior to its IPO, Qunar went on this crusade to go from flight, to hotel, to other multiple travel services, transforming itself to become more of an OTA platform rather than just a media platform.

That’s a very important transformational change that allow it to grow from a $500-$600 million valuation company when Baidu first got involved or invested, to post IPO $3-$4 billion company. That was the second milestone. Obviously as a company further evolved and went to this huge battle with Ctrip, the eventual merger with Ctrip was inevitable given how intensive the competition was. And that is facilitated by both Baidu and ourselves, the investors, in association with the management teams.

ZARA ZHANG: So, before they became a real OTA it was more differentiated from Ctrip in terms of product?

JIXUN FOO: Right. But you can think of the relationship kind of like Baidu versus Alibaba or Taobao. Because if you are the metasearch and one is the OTA, at some point the conflict will be there if you become the dominant player and the other is the dominant OTA player. While they are playing a different role in the value chain they are competing for value. That competition got intense, so we have to take certain sides. We took side with Baidu earlier, and then we did the merger later with Ctrip.

HANS TUNG: Just to put that into perspective. Like Jixun said, when he got Baidu to invest in Qunar, Qunar valuate was between $500 million and $600 million. Kayak in the US didn’t have any investment from Google or any search engine. It was sold to Priceline, the number one OTA in the US, actually in the world outside of China, for $2 billion. Kayak was a global company sold for $2 billion, and Qunar was only $500 million to $600 million in China, as a China only player, doing exactly the same thing but with Baidu’s involvement, it ends up increasing the valuation of the company by teaming up with a number one search engine in China to become $3 billion to $4 billion. So huge important deal to change the valuation and complexion of the landscape in China, in this area.

JIXUN FOO: That’s right. To Hans’ point as an investor and partner to entrepreneurs, the entrepreneurs drive their business on a day to day operationally. They understand the landscape quite well, they develop the strategy and execute on it, but for the most part I think what investors have is that we have this global landscape, particularly our team here at GGV. So, we understand a lot of the dynamics that’s going on the ground, looking into that future, where do we create value. The creation of value is not just for ourselves. The creation of value is also for the entrepreneurs. And oftentimes we hope that we could offer a value-added advice and hopefully positioning the company for greater success.

ZARA ZHANG: Could you talk about the role that you played in the Ctrip-Qunar merger, and how long did it take and what were the biggest challenges?

JIXUN FOO: Well, it took a long time. I had long conversations with all sides including Ctrip, Baidu, Qunar. for lack of a better way to describe it it was pretty intense. We have to realize one thing right. The complexity comes from the fact that you have two companies, two managements that have fought over a few years, and many years. There is a missing element which is trust. And so, it’s tough. How do you establish understanding and trust of what the eventual, not so much just in the value of the acquisition, relative value for both or one, it’s also the fact what’s the eventual management going to look like? That transitional management, that’s the big part of the conversation. In fact, I spent so much more time talking through that and going through every single options and that takes a lot of time, because there’s emotions involved, and entrepreneurs and managers need time to digest a lot of these options and conversation. But having said that, I think it took time to come to terms, and typically if I reflect on some of the positives I’ve done including Tudou 土豆, Youku 优酷, etc., most of these deal easily take six months to one year. That’s the kind of timeframe you have to be prepared for.

HANS TUNG: How are you so patient through this process? Because it’s easy to have objections, easy to have people say, no, or not right now. How do you get people to eventually say, yes? And how do you come up with a method to slice the pie so that everybody feel they’ve got something that’s either tolerable, or acceptable, or something that’s worth moving forward?

JIXUN FOO: Perhaps the patience is inevitable because you have to live with it. And it’s not something that you need that patients for that matter. You have to be appreciative of all the energy, emotion, the sweat, the tears that entrepreneurs put into building these companies. It is not easy. And so, we naturally have to appreciate and empathize with those emotions. That’s very important. Number one. Number two, I think having said that entrepreneurs are also rational. There’s a rational part of them, understanding the value of those outcomes. Numbers do make a difference, rationalizing through those numbers. And also, typically there is a premium for the exit party. And so how do you rationalize through those premium for both the buy and sell side to come to terms with and have some sort of a settlement on it. I think that process, the number process is also important, because it’s a full realization of value to the team. Obviously if I acquire the buy side, the buy side typically get the upside on the future value, whereas the sell side gets the value that is premium today, a premium to the current value. There’s a bit of a working model if you will and rationalization to the economics of it. And typically for entrepreneurs, they’re quite rational. At the end of the day they work hard, and they have sweat and tears behind it, and that earn can be a meaningful reward for them.

ZARA ZHANG: I’m curious because you said that because that conversation between Ctrip and Qunar became so intense it became inevitable for them to merge. Is this a China specific phenomenon, because in the US there are also a lot of intense competitions but there doesn’t seem to be as much mergers of rivals?

JIXUN FOO: Yeah. I think maybe the competition in the US is not as intense as in China. Zara, you’ve been here in China over a few years and you’ve seen how intense competition is and how ruthless. The more ruthless they are they fight more intensely. If you look at Uber versus Lyft, and you compare that versus DiDi versus Kuaidi, it’s a different level of intensity.

ZARA ZHANG: Sometimes in China there are literal fights like between delivery man of takeout companies.

JIXUN FOO: It’s fairly intense. And given that, it further drives the necessity to actually come to terms on a steady state. What is that steady state? The steady state in some cases, if you look at some markets, in some cases as they come to terms, whether it is the online video landscape, there’s still compared to competition. Or if you look at the food takeout landscape like Ele.me versus Meituan, it comes to a steady state where they stop the intensity and they start raising take rate. So, there are certain times when it does come to a steady state and certain mergers cannot happen for various reasons. But otherwise whether investors continue to fund it, and they need capital, the need for capital actually drives a big part of the merger conversation.

HANS TUNG: You also see the founders getting diluted every time they raise more money. If their board doesn’t top up with more refresher, because the battle is so intense and it’s hard to figure out who’s going to win, then it makes it harder for the founder to keep on raising money. And because the type of competition is so intense that you know the other guy is not going away so you do you really want to do this for another two-three years or do you want to figure out a way to resolve this. After you go 9-9-6, 9 a.m. to 9 p.m. 6 days a week, or sometimes double 7, you work all the time seven days a week, and you do that for three or four years you’re like, I don’t want to do this anymore. Because the other guy’s not going away, I have to raise a lot more money, and I’ll get diluted more, and life is not going to get any better for the next three or four years versus what just happened the last three or four years. So, you’re much more willing to figure out a way to get out of this stalemate.

JIXUN FOO: I think you’re absolutely right. That’s the kind of conversation oftentimes we have to have with the entrepreneurs, kind of rationalizing to the options ahead of them. The risk versus the reward, the downside versus the upside. Like I said, I think entrepreneurs there’s an emotional part of them where there’s a conviction and drive that make them who they are, but at the same time there’s a very rational part of them that understands some of this risk-reward equation.

ZARA ZHANG: So, with that that’s all we have for this episode. And thanks, Jixun, for your time.

JIXUN FOO: Thank you.

HANS TUNG: Thank you. Thanks for listening to this episode of 996.

ZARA ZHANG: GGV Capital is a multi-stage venture capital firm based in Silicon Valley, Shanghai and Beijing. We have been partnering with leading technology entrepreneurs for the past 18 years, from seed to pre-IPO. With $6.2 billion in capital under management across thirteen funds, GGV invests in consumer, new retail, social, Internet, enterprise cloud and frontier tech. GGV has invested in over 290 companies with more than 45 companies valued at over a billion dollars. Portfolio companies include Airbnb, Alibaba, Ctrip, Didi Chuxing, Domo, Hashicorp, Hellobike, Houzz, Keep, Slack, Square, Toutiao, Wish, Xiaohongshu, YY and others. Find out more at ggvc.com. We also highly recommend joining our listeners’ WeChat group and Slack channel, where we regularly share insights, events and job opportunities related to tech in China. Join these groups at 996.ggvc.com/community

HANS TUNG: If you have any feedback on this podcast or would like to recommend a guest, please email us at 996@ggvc.com.

Episode 34: GGV Fellows

GGV Capital’s Hans Tung and Zara Zhang interview two “GGV Fellows,” David Sun (a data scientist on Apple’s Siri team) and Bo Ning Han (a recent Harvard grad working on a startup in Beijing), on their life stories and their takeaways from the GGV Fellows program. What is the GGV Fellows program? Read this blog post to find out more.

If you are interested in applying to future batches of GGV Fellows or our other events, please join our listeners’ community via WeChat/Slack at 996.ggvc.com/community, where all related announcements will be posted.


HANS TUNG: Hi there. Welcome to the 996 podcast brought to you by GGV Capital. On this show we interview movers and shakers of China’s tech industry and discuss how founders from around the world can draw lessons from China’s tech ecosystem. My name’s Hans Tung. I’m a managing partner at GGV Capital and I’ve been working at and investing in startups across the US, China, and other emerging markets for the last 20 years.

ZARA ZHANG: My name is Zara Zhang. I’m a marketing manager at GGV Capital and a former journalist. Why is this show called 996? 996 is the work schedule that many Chinese founders have organically adopted. That is, 9 am to 9 pm, 6 days a week.

HANS TUNG: To us, 996 captures the intensity, drive and speed of the Chinese internet companies which have produced many growth miracles over the last decade.

ZARA ZHANG: Also, I highly recommend joining our listeners’ WeChat groups and Slack channel where you can connect with like-minded people interested in tech in China. We organize regular offline events across the world for our followers. You can join these by visiting 996.ggvc.com.

Hi everyone. Before we jump into today’s show, I highly recommend checking out the last episode of the 996 podcast if you haven’t already. During the last episode, Hans and I discussed the challenges and opportunities that Hai Guis, or Chinese overseas returnees, face as they come back to China. That episode has very useful background information that will help you make sense of this episode.

On today’s show you will hear from a few of our GGV Fellows. What is GGV Fellows? It is a program that we launched this year which was designed for sea turtles or Chinese overseas returnees to get re-acclimated to the Chinese startup ecosystem and business environment. During the program, 34 global-minded young leaders came to Beijing and completed a one-week, intensive training on tech and entrepreneurship in China.

Our 34 Fellows were carefully selected from over 400 qualified applicants. They come from top institutions around the world. The most well-represented schools are Stanford, Harvard, MIT, and Berkeley, and many are currently working at Silicon Valley tech companies such as Google, Facebook, Uber, Apple etc. All of them are native speakers of Chinese or equivalent and are fascinated by the meteoric rise of China’s internet sector over the past decade. Among the first class of the Fellows, two-thirds were professionals and a third were in school. Their ages range from early-20s to late-30s. They represent a diverse range of talent and skill sets including engineering, product, business, and marketing.

During the program, the Fellows visited the headquarters of eight Chinese unicorn internet companies and heard from a total of 21 founders or executives who shared lessons on what it’s like to start and run companies in China’s business environment. Our speakers came from some of the most valuable tech companies in China including ByteDance, DiDi, Xiaomi, Xiaohongshu, Kuaishou, Face++, Zuoyebang, Liulishuo, Keep, Hello Chuxing and others. During these closed-door sessions, the speakers shared not just tips for success, but also candid stories of failures and pitfalls that they ran into along their startup journey. The program is designed to resemble a lightweight MBA on all things related to China’s startup ecosystem. And by the way, if you’re interested in learning why we organized the program, we actually have a blog post in which we discuss the rationale for starting GGV Fellows. You can read the blog post by following the link in the show notes.

Now you will hear a few interviews with our GGV Fellows on their life stories, what brought them to the program, and what they took away from it.

HANS TUNG: Hi everyone. Today I will interview one of our GGV Fellows, David Sun, or Sun Qiwei in Chinese. David’s currently a Data Scientist at Apple in Cupertino. He’s originally from Suzhou, China, and attended college in Germany at Jacobs University in Bremen before heading to the University of Pennsylvania to obtain a PhD degree in double-E, electrical and system engineering. Welcome to the show, David.

DAVID SUN: Thank you Hans. My pleasure.

HANS TUNG: So how was GGV Fellows for you?

DAVID SUN: Well, I guess you’re asking about program, but first of all I think the Fellows were absolutely amazing in my inaugural class. The program itself, I think, it’s frankly amazing if not surreal. Personally, for me, I didn’t quite know what to expect. But when I was in Beijing, it was a week of packed schedule, of closed-door conversations with senior executives and founders of the hottest startups in China, and office visits. So, it was eye-opening for me to be there.

HANS TUNG: How many meetings per day roughly?

DAVID SUN: Well, jokingly towards the end of the program, everybody was almost near the burning out period and it’s almost like a 996 schedule we’re having.

HANS TUNG: Like this show.

DAVID SUN: I think it’s roughly 10, 9 meetings at least, a day. And we’re doing lunch meetings and we’re eating in the bus and we’re told to hurry up, to use the bathroom at the next company when you arrive there.

HANS TUNG: So, Zara and Erica, Fischer, Caiyao, they did a great job of scheduling and organizing this and ushering you guys along?

DAVID SUN: Yeah. I think not only carefully curated this program and all of the conversations and visits, it was also very thought as an- we jokingly say it’s an immersive boot camp for anyone who wants to do a Chinese startup.

HANS TUNG: And how many of you went on this trip together?

DAVID SUN: Roughly 36 of us, I believe.

HANS TUNG: Out of an applicant pool of over 400. So, you guys are all very lucky and well-deserved.

DAVID SUN: Definitely it’s what I felt as well.

HANS TUNG: When we thought about this program, we didn’t expect to be seeing this many applicants. On top of that, most of the 400-plus applicants had very strong resumes, so it was very hard for us to choose. We were flattered and very impressed. And we’re glad that this community is forming and want to foster that.

DAVID SUN: Yeah. I think the team did a really good job in terms of marketing and soliciting applications. There was this joke thing we say, it’s Liebian 裂变, chain reactions,  because they ask every single Chinese to refer at least three or four of their best friends. I personally actually referred a number of friends and I personally feel guilty about them not being selected.

HANS TUNG: Well, thank you for your support. My next questions is just share a bit more about yourself and your life experiences. I notice that you have lived in eight different cities, so I would love to hear more about it. I personally have been in nine, so I know what that has done to me. So, I’d love to hear what that’s done for you as well.

DAVID SUN: Sure. I left for Germany when I was 16 for college. When I was in Germany, I did a number of internships and also just backpacking on random trips and locations. And after that I moved to the States for my PhD studies.

HANS TUNG: So, you did college in Germany?

DAVID SUN: In Germany, yes.

HANS TUNG: And you left for there when you were 16 or 18?


HANS TUNG: 16. So you started school early?

DAVID SUN: I used to be in a program called Special Class for Gifted Young. It’s a collaborative program which is between my high school and the University of Science and Technology in China. We had a lot of renowned grads like Zhuang Xiaowei, the first and youngest tenured professor at Harvard. But at the time when I was 15, I looked around and felt something was wrong. I always felt I was rushing myself in this accelerated pace of study. And I personally felt there’s something more to life than academic excellence.

HANS TUNG: And this program was in Suzhou?

DAVID SUN: This program was in Suzhou High School. It was one of the only in the nation at the time because there just weren’t that many people to participate, I guess. So, I made a decision to actually go and see the world instead of going to college. I took a year, basically to prepare for the tests. And in retrospective- I think you’d definitely echo- being open and traveling across different countries at a young age, in particular during my teenage years, really helps to shape a global mindset and building up this open-mindedness which is, I believe, critical in navigating through an ever more increasingly globalized world. And internationally, I feel that really helps me to understand and appreciate and respect diversity and differences in cultures, beliefs, and societies.

HANS TUNG: Why did you pick Germany?

DAVID SUN: Frankly, I applied to a number of places. I felt most of my friends would end up in the States for grad school or for work. If I couldn’t be the best, I’d like to be a little bit different. And I was a petrol head and really into cars and football, so Germany’s kind of a reasonable place to choose.

HANS TUNG: What were the most surprising things about Germany that you didn’t know before and you discovered when you were there? And what were the things that impressed you the most?

DAVID SUN: I think one thing that impressed me most about Germany is time management and dedication. They’re almost the same thing. I think there are a lot of urban legends on Chinese social media about how Germans are carefully curating, managing, and documenting everything. Just two examples for this. First of all, when I was first in Germany, I had a host family. And Germans really don’t like mobile phones. They’re not really communicative in general. They actually have the lowest penetration and also phone usage in all OECD countries if you look it up. I read on The Economist a while back. They would phone up their friend and say- I believe it was in September- they would say, “The winter’s coming. Should we grab tea together on the second Sunday of November?” And then the other person would say, “Let me check my calendar.” They’d take out their little book, they’d find that date, and then they’d be like, “I’m available and let’s meet for tea at 2 pm at your house.” And they would never phone each other again. They would just show up on time. It was incredible. When I come to the States, it was Quaker time when I was at Penn. Everybody’s half an hour late. And then Berkeley time, 15 minutes late. And then Germany time is time. And then the second thing about their managing of documentation, I went skiing my first year in the States and I broke my glasses. It was holiday season, and nobody would actually give me a prescription in time. Out of despair, I phoned the optical shop back in Germany where I had my glasses about three years ago. I gave them just my first and last name.

HANS TUNG: And of course, they had your record.

DAVID SUN: And they had my record. They emailed me over in 10 minutes. And I think this kind of dedication to documentation and time management is what made the country so efficient and so good at craftsmanship. When you think in terms of building an actual physical object, cars in particular, there’s so many pieces and movements in there. You just have to be so meticulous.

HANS TUNG: And precise.

DAVID SUN: And precise. So that’s the takeaway. I wasn’t very organized before going to Germany.

HANS TUNG: So that changed for you?

DAVID SUN: It was a big change for me and really helped shape me for better, I believe.

HANS TUNG: Okay, good. Now onto the US. It was for a PhD at UPenn? What was your impression of Philadelphia?

DAVID SUN: I was leaving my consulting job at KPMG when I was moving for grad school. Connor actually came to my farewell party and he emailed me the first week I was in the States. And the email title said, “Hello David. How is United States?” And then the body of the email said, “Is it really fun just like in the movies?” And really, frankly, when I first got into the States, we actually had somebody renting a house for us and it was in West Philly. I’m not sure everybody knows how West Philly’s like. It’s basically Chicago inner cities, slightly better, where if you call 911, people come after an hour because policemen don’t want to be in danger. So, it was a huge shock for me because it’s quite different from Europe in general and also quite different from the movies I have seen about the States. I’m talking about American Pie and Friends and other things. But it’s an interesting experience to see how the landscape in an urban environment is in a different continent and also in a different political system. But Penn overall is great. And I want to say here for the record, Penn is one of the safest schools. We have a lot of security personnel.

HANS TUNG: I’m glad you said that. I was going to ask just to make sure.

DAVID SUN: Yeah. We take care of everybody.

HANS TUNG: That’s right. You’ve got to pay respect to UPenn which is great. I’ve been to UPenn a couple of times. I enjoyed both experiences when I was there. So, what prompted you to join Apple? And how long have you been at Apple and do you ever get the entrepreneurship bug to do something on your own?

DAVID SUN: That’s a lot of questions. I’ll answer first why did I join in the first place. My first job after grad school was at a political consulting firm, the legacy branch of Monitor, which took care of all the US agency clients, public opinion monitoring consulting. I did for about a year and then I realized it’s not quite the thing for me. I think I enjoy problem-solving and critical thinking and quantitative things more than what might make me most successful as a consultant, especially in the public opinion consulting environment. Towards the end of 2017 I got a call from a recruiter at Apple and he said if you’re interested in doing something cool with artificial intelligence and I basically jumped at the opportunity. I said, yeah, it’s probably time for me to move to tech.

HANS TUNG: How did you go from a PhD degree in electrical and systems engineering to public opinion consultancy?

DAVID SUN: My PhD’s actually in systems engineering and my concentration is on human behavior modeling. What we do is apply quantitative modeling and computer simulations to understand and predict human behavior. My lab back in the ‘80s and ‘90s did this profiling of all the world leaders and tried to predict, basically, military conflicts around the world.

HANS TUNG: Based on what was on the public speeches?

DAVID SUN: Based on public speeches extracted and formulated personality models of those leaders. And I personally, with my PhD work, we actually published how to predict and model coalition dynamics in regions of conflict like Syria with different military factions and ideology claims, how they form different coalitions. We also used a model to do US election back-testing in 2008 and we were able to achieve a very highly accurate model that predicts down to the zip code how, collectively, people would vote for a particular candidate based on ideology. And that was very interesting.

HANS TUNG: Where do you get the data on people’s ideology.

DAVID SUN: Basically, if you look at US elections, there are published positions of those candidates. And there are also the Annenberg National US Election Survey, one of the largest panels composed of- it was hosted by Penn as well at the time. What they do is they ask about what are your positions on the top six or eight issues that are controversial and divisible including taxation, welfare, immigration, and then there’s the pro-life and pro-choice kind of topics. And then based on those questionnaire responses, you can basically place an individual and then groups of individuals in a high-dimensional ideology space. And then there are also the interests and alignment with the published statements of the political candidates. And then you can see which candidate will give them a higher perceived utility. Individually, there are noises and people who are irrational or just misinformed. But collectively, noises cancel out and they form a near-perfect behavior in terms of making the better choice for themselves.

HANS TUNG: Fascinating. So, from there, where did you go next?

DAVID SUN: From there, I was one day given this report on Syria about different ideological groups in Syria. And it said State Department: For Official Use Only and I traced back to the author of that document. Turns out that the former partner of that practice was a Penn alumni and so was the Vice President. So, I reached out naturally, and I said, “Look. It’s pretty cool and I’ve been doing PhD work on this. Do you think you can have me as an intern?” And that’s how I started with them. It was really nice.

HANS TUNG: What did that internship lead you to?

DAVID SUN: The internship led to a full-time offer naturally. And I joined the firm being one of the first data scientists, leveraging technology to help them to extract people’s what they call narratives of things and then tracing public opinion on core social issues for a number of clients from US Government to financial services agencies and just general consumer friends.

HANS TUNG: And how did you go from there to Apple?

DAVID SUN: I think that really helped me to build a lot of more solid engineering technical skills. I felt there was this insufficiency for me personally in terms of a particular technical area. I actually had a couple of offers at the same time. One of them I still remember was to be a Content Strategy Manager for Coursera, deciding what curriculum they’ll be adding. So, like a mini-provost for branching out their studies. But my argument to myself is that I think it’s easier to go with the technical track, an engineering track, when you’re younger because you think faster and you’re more energetic versus if I go for managerial consulting track and then do an MBA. I think it’s much more difficult to come back to the technical field because the pace of innovation and the pace of change in the tech world is just so fast. And I want to stay tuned until I’m ready to make the jump.

HANS TUNG: So, you were in school at UPenn and you reach out after reading about this research and start working for Monitor. You start as an intern and then become full-time. And then how did you go from Monitor to- what city were you in for Monitor? New York?

DAVID SUN: Monitor’s actually in San Francisco. It’s Monitor 360, the former government practice.

HANS TUNG: Okay. That takes you to the Bay Area. And then how did you go from Monitor to Apple?

DAVID SUN: I think after the first year I realized that I was not sufficiently trained in technical and engineering backgrounds. I basically made a judgment call that it would be better for me at a young age to concentrate more on the technical track until I’m ready to make the jump entirely to strategy or management side. And it became interesting for me to actually look for tech firms in the area. I wasn’t seriously looking at that time until the end of ‘17. And I got a call from a recruiter at Apple and he said, “Look, we have this really cool thing going on here. We’re expanding a secret AI project that I can only tell you after our first phone conversation. Would you like to do the interview with us?” And I did and naturally, everything just followed afterwards.

HANS TUNG: And what are you doing at Apple now that you can share?

DAVID SUN: I think for the official tagline, I am developing and enhancing the natural language understanding capability of Siri, the voice assistant. And that’s all I’m allowed to say.

HANS TUNG: And do you feel that by doing that, it improves your technical background and experience?

DAVID SUN: I think definitely it does. I think one of the things I did not realize until I joined is that there is an inherent advantage to large tech firms. It’s the scale of their problem. When I was at Monitor, our clients are really looking at probably thousands or quarter of a million, half a million sizes of data and asking us why and those kinds of probing questions. But at Apple, whenever we develop networks and roll out a specific feature, we’re serving in hundreds of millions a day. I think that’s really valuable experience. And also, it really helps you, and almost forces you, to think big and think at a different scale.

HANS TUNG: And then when you’re at Apple, did you ever see anyone around you do a startup? How did you come to know about innovation in an entrepreneurial setting?

DAVID SUN: I think at Apple, the first month and second month I joined, I actually saw two colleagues departing, one for a self-driving startup and the other one went on to do ICOs, cryptocurrencies. I guess it was a bit late for him to do that. But anyway, in terms of entrepreneurship, I have always been a firm believer in startup life. I think in order to do great things, I would say for anyone with a mission to realize their dreams, they should try to work for themselves and commit their life, or at least a period of their life, to at least one attempt to build something they believe in. That’s my personal credo so to speak and I’ve always been seeking opportunities to do so. I have done one startup back when I was in grad school, an iOS social app that got FbStart funding. But in the same time, I realized it’s not quite truly my passion. And we had a very competitive competitor at the time when we launched, and it didn’t go quite well. But then I think that dream still just persisted in me. And personally, for me at this stage, I’m trying to build as much of technical background as I can and also just building important connections that will become useful when I do decide and find out what my passion is.

HANS TUNG: Let’s say you can raise $5 million today. What would be your startup idea that you would want to spend a lot of time in?

DAVID SUN: I think there are two considerations I always have when I want to do a startup. One is how confident I am to realize it. And secondly, how much of a positive impact it will have on society. I have actually long been thinking about doing a startup in the area of strong and general artificial intelligence in language understanding. I think this will be a critical trend in the next decade for reasons that are almost obvious. Number one, there will be a new form, a much more efficient and natural form, of human-computer interfacing methods.

We’ve been using clicking and typing as the major form of communicating with computer systems ever since the invention of it, for nearly almost a half a century now. But we humans aren’t quite programmed to just use our fingers to communicate. The most natural form of communication for anyone, as we’re doing right now, is through talking. And this really requires this computer system to have this capability to fully understand and take in what our intents are. And language systems would help bridge the gap. I think that has two very important applications. For one, if you think in terms of the human-computer interface, this would help to bring technology so much more personal and incredibly easy to use for even people who have no computer skills at all. And that, I believe, there are plenty. And secondly, there are massive troves of data existing in the internet space and in the broader public domain that are in text and not in any other form. We currently are still doing string word-matching to find information. And we have humans reading, analysts reading through pages of documents from prospectus to due diligence documents to files and industry reports to get maybe one or two useful pieces of information. But what if the computer had the capability to read, to understand, to summarize, and also to do the QA in a near or super-human level? I think there have been some startups in the area, in some vertical industries, doing this already. But I think it’s still a relatively under-developed field that is inherently challenging. And I personally just like challenging things.

HANS TUNG: And it’s natural language processing in a very specific vertical use where people will pay a premium for the benefits it generates?

DAVID SUN: Correct.

HANS TUNG: Okay. That seems like a solid idea. So now you’re at Apple, Cupertino, and the new campus is amazing. It’s very easy to just work there for the rest of your life and never leave because it’s so beautiful and so self-sufficient. What prompted you to decide to apply for GGV Fellows?

DAVID SUN: First of all, about Apple, the campus is indeed amazing. But in terms of why I wanted to apply for GGV Fellows, obviously I do have the dream in the long term to do something on my own and to be good at it and making an impact that’s very tangible and personal. I don’t believe you can quite do that in an enormous organization, in any enormous organization. Secondly, I think with the current economic and political trend, China is taking an ever-increasingly important role on the world stage, economically and politically. It’ll be a natural thing to do to be in those environments. Just like in the old times you would want to go to Venice, Florence, Milano to be a merchant. I think if you want to do a startup and you want to do a venture, you want to go to an environment where it’s business-friendly and also the overall society is providing this good foundation for your business.

I recall vividly one thing I read on Wired about reports of Steve Jobs in his final days going to see the construction site of Apple Campus. He appeared very upset and his fellow men asked why aren’t you happy about the new campus. He said he just realized everything has an end. Not to bring this into any depressing tone, but I think overall for every single business entity, it’s fundamentally cyclic and there will always be the next big thing. It is important for those individuals who can to take the leap of faith and commit to what they believe in will be the next big thing and eventually build it. And I hope I can be one of them.

HANS TUNG: Along the way, it seems like you were also impressed by Peter Thiel.

DAVID SUN: Yes. I think he is a marvelously brave, intelligent person. He’s almost contrarian in a way in the tech world. I read his book and almost every single executive and founder we’ve met in China on this GGV tour was talking about Zero to One and talking about the process of building something out of nothing. I think that’s a very helpful and informative writing that he has had.

HANS TUNG: So, amongst your one-week trip in China with GGV Fellows, who was an actual live speaker that you heard that impressed you besides people quoting Peter Thiel?

DAVID SUN: I think it’s Lin Lin, Stanford grad, Chief of Staff of Kuaishou. Kuaishou is the social network side for video clip sharing. It’s a very controversial service and widely criticized for public domain by some people who think they’re sharing distasteful and boring or just-

HANS TUNG: Low-brow content from Tier 3, 4, 5 cities.

DAVID SUN: Yeah. I think that’s the perception almost everybody in the class had before him coming in. I talked to a lot of people and they were like, “Why would a Stanford grad go and do this kind of things.” And people gossiping and people wanting to ask him so many questions. But then he came in just being very candid and very relaxed, and he’s like, “Look, I know you all have this perception of this infamous company I work for, but here’s our mission.” So, he shared the value of Kuaishou which I really echoed with and a lot of people in the room did as well. It’s about recording everyone faithfully. He said there are three things good in life: the truthful, the kind, and the beautiful. If you think about Instagram and then there’s the Douyin and Xiaohongshu, it’s the beautiful. And then NGOs or World Food Organizations are the kind. And Kuaishou is the truthful. That’s a very interesting perspective. And he compared his business to the artists composing a Qingmingshanghetu 清明上河图, a famous painting of all the daily lives of working class people in Song Dynasty. For those who don’t know, it’s like realism paintings in 19th Century French art circles depicting the life of working class people.

HANS TUNG: That’s right. This happened almost 800 years ago.

DAVID SUN: Yeah. So basically, he’s arguing that it is the modern version of an art piece that is faithfully recording the daily lives of people who, in the pre-Kuaishou era, were simply omitted in history and the media archives. And I had this kind of aha moment and eureka moment of, “Wow. This is what they’re doing.” This is kind of eye-opening and really just astonishing for everybody in the room and they were like, “We didn’t know you were doing charity work.” And I think to a certain extent, it is. They were talking about universal values. They were talking about how we should give everybody the opportunity to share, equitable access, and went into a very meaningful and deep conversation. That was the most unexpected part of all the workshops we’re attending. I personally was very touched by his candidness and also their vision, at least their advertised vision, as well as just how openly he was willing to share business and regulatory hurdles Kuaishou was facing when growing so fast and moving so fast. So that was, I would say, the most memorable piece.

HANS TUNG: Any big takeaway after one week, things you learned or things that you feel you can take away and help you to do something else new later?

DAVID SUN: I think without a doubt it would be realism. Not Kuaishou’s style, but realism in the sense that I think a lot of us who have been studying overseas and going to elite institutions and working at big tech companies are living in bubbles. We didn’t quite have an actual grounding in markets outside Silicon Valley, outside school. Getting a reality check felt slightly painful, a little bit discomforting, but fundamentally reassuring. And for me personally, I think a lot of my friends and me personally had over-romanticized the idea of doing a startup. Not romanticized, but almost to the extent of fantasizing getting exorbitant valuations after six months, after six months, after six months of doing this marvelous unicorn. And the reality when we visited all the companies and talked and really learned from all those founders and senior executives is that I think the idealism is there. The passion and the urban legends, some of them are truly real. But the amount of effort, dedication, and the firmness of your faith and belief in actually executing it and being the persistent leader of the organization takes a lot of courage, a lot of perseverance. I think I went there with a lot of curiosity and I came back with a lot of respect.

HANS TUNG: I was a founder twice. Both companies didn’t do that well. But it is the hardest job on earth to be a founder/CEO and lead your troops from zero to one. As a VC, I think no matter how hard I work, it’s an easier job. And like you said, we all have a lot of respect for the founders we back.

DAVID SUN: Yeah. And that was kind of the key takeaway.

HANS TUNG: Do you have any plans to return to China to work in the future? And how would what you learned from this program impact you to make your decision going forward?

DAVID SUN: I think first of all in the long run, as I said earlier, the economic trends are really going in favor of China and Asia and a lot of emerging economies. I foresee for the next few decades. And it is a natural thing to be there and to be on the ground and, using a war metaphor, fighting the battle or to build a business venture in those economies. The program itself really helped me in two ways. One, as I said, getting a reality check to fully understand and have that kind of breadth and depth in such a short period of time is simply incredible and unparalleled. And secondly, it also helped me with a lot of social programming with our Fellows in the class, building important connections of people who might become partners in the future. So overall, I feel this is a great program that really helped me to find directions and to make more informed choices in the future.

HANS TUNG: If you have any suggestions for next year, how can we do it better?

DAVID SUN: Make the next class work harder. Do 007.

HANS TUNG: In terms of size of the class, do you think 36 was good? Or do you think it should be more or less?

DAVID SUN: I think it’s about right. If any larger, it would be difficult to build a cohort and a sense of camaraderie in such a short period of time. I would say 30-40 people is about the right size.

HANS TUNG: Interesting. Do you feel you got to know almost everyone in the group?

DAVID SUN: I tried to be as social as I could and I only, I would say, had relatively deep conversations with about three-quarters to half of the class.

HANS TUNG: So, you’re right. It’s about the right size. Any bigger would not be as effective. Then the last question, a fun question. If you have 10 days for vacation this year, where would you want to go and why?

DAVID SUN: I would go to Israel. I think Israel is the other Silicon Valley other than Zhongguancun, Shangdi, and actual Silicon Valley. I was almost going to go on a client trip at the beginning of ‘17, but then there was a terrorist attack in Jerusalem, and I had to cancel last minute by the firm. I’ve heard a lot of great things. One thing I really like to do is whenever I go to places, I read on their history and culture. My Promised Land about the whole Zionism and the movement, the returning back to Israel, was very touching for me. And I really want to be there and witness this myself.

HANS TUNG: Thank you very much. It will be on our podcast.

DAVID SUN: Pleasure. Thank you, Hans and thanks, everyone for organizing the GGV Fellows program.

HANS TUNG: Thank you.

ZARA ZHANG: Now you will hear an interview with another of our GGV Fellows, Bo Han or Han Bo Ning in Chinese. Bo went to Harvard for his undergraduate studies and graduated in 2014 and has worked as an engineer at Google as well as at a startup in LA before returning to China last year. So, Bo, could you tell us more about your background, where you’re from and why you’re here?

BO HAN: Sure. I was born in Beijing in 1992 and then when I was three, we moved to Hawaii. I lived in Hawaii for about seven years and then I moved to Connecticut, my first stop in the mainland. Lived there for a year. Then I went to middle school and high school in Indiana. I went to college at Harvard and then lived in San Francisco and Los Angeles. And then last year in July, I came back to Beijing.


BO HAN: I’m co-founder and CTO at a tech startup with my cousin and we’re focusing on English education for the zero to six age range. Currently, most of our development happens on WeChat, specifically WeChat Mini Programs or Xiaochengxu 小程序.

ZARA ZHANG: And why did you apply to GGV Fellows?

BO HAN: Before, most of my life and work experience has been in the US, so I thought it was a really good opportunity to learn more about Chinese tech. I’ve also previously listened to the GGV podcast a lot. I got a lot out of that.

ZARA ZHANG: I think you’re quite special because I have a lot of friends who spend the vast majority of their lives in the US even though they were born in China. And they identify with the term ABC or American-born Chinese even though they were born in China. And they may not even speak Chinese whereas even though you left China at age three, you’re still extremely connected with Chinese language and culture and you still identify as a Chinese person. Could you talk about why that’s the case?

BO HAN: I think most of us are very influenced by our parents. And my parents, I think, are pretty different from most ABCs’ parents. They studied the humanities. My dad is a history professor and my mom studied Chinese in college. So, from a very young age they really cared about me learning about Chinese history and Chinese language. I remember as a kid my mom, pretty much every day, would read the Yuwen textbooks with me, even though it was at a slower pace than a normal Chinese kid. But I think even with all of that, after coming to China, I’ve had to downgrade my sense of my own Chinese ability. Before, in the US, I would consider myself like a supposed native speaker. But after coming to China I feel like I’m more of, at most like a middle school level of Chinese.

ZARA ZHANG: I think you’re extremely fluent, but I think a lot of it is not language but the nuances of the culture and society that you can’t get in textbooks.

BO HAN: Also, the Chengyu 成语. They’re very difficult.

ZARA ZHANG: So how has the adjustment been? How long have you been here now?

BO HAN: I’ve been here for about half a year. I think the adjustment has been pretty easy. I think mostly it comes down to the attitude where I’m very interested in Chinese culture and Chinese tech, the changes that have been happening in society. I think living in the US for so long I am just so familiar with US society and US culture that it’s just really interesting to learn more about a different culture. But also, I feel like it’s my own culture, so connecting with my own roots.

ZARA ZHANG: Could you talk about your experience with GGV Fellows? After you came in, what were your expectations and how did the program turn out for you?

BO HAN: Even before GGV Fellows, I felt slightly overwhelmed because in the group chat you sent five or six different books in Chinese about tech.

ZARA ZHANG: Yes. I made everyone read this book list, all Chinese books on Chinese tech.

BO HAN: I started reading one of them. It’s an overview of 2008 to 2018.

ZARA ZHANG: Jidang Shinian 《激荡十年》.

BO HAN: Yeah. And then I started timing myself. So, I’ve read one chapter. How long would it take for me to actually finish this book. Then I realized that I couldn’t actually finish the five or six books. And then I didn’t actually finish that book by the time the event started. But I think after going into the event, I realized that I could follow along. And then every day was really action-packed, but it was like a fire hose style of learning. Really just got an overview of a lot of different industries and then also companies at various stages. Even though I think the earliest stage company was still pretty large, like Series A possibly.

ZARA ZHANG: I would say most of the companies we interacted with were unicorns, but there were a few that were more early stage. So, what was something that left the most impression on you?

BO HAN: I think there’s two aspects. One is the actual companies that we learned about. I think one of the really interesting companies for me was Moka. The co-founder, he left China I think as a-

ZARA ZHANG: Orion Zhao.

BO HAN: Yeah. He went to Berkeley for college and then most of his work experience was also in the US. But he came back to China, I think, when he was 23 or 24 or something like that. And he decided to go into the 2B industry which I thought was really interesting given that he didn’t have prior experience. But it seems like he has a really good attitude toward learning and just talking to a lot of different people. I think that’s a really good skill set to have.

ZARA ZHANG: Why did you identify with him?

BO HAN: I think his outlook is very Silicon-Valley-inspired. I think it’s just inspiring how he managed to build a company even though he didn’t have prior experience in that area or in China really.

ZARA ZHANG: You have worked in Google in Mountain View and also a startup in LA. How would you compare what you saw in the US, the tech space there, versus what we’re seeing here? What are the major differences in both just people’s attitude and work environment?

BO HAN: Well, there’s two aspects to it. One aspect was listening to the GGV podcast, I got the impression that every company was very 996 all the time, all the employees were 996, a little bit like sweatshop conditions. But I think after visiting the companies, I’ve gotten a little more nuanced understanding where 996 is more of a mindset where people are thinking about work more often than people in the valley. And I think that’s definitely true, especially within co-founders or higher-level employees within companies. They’re constantly thinking about how to run their company. And I think part of that possibly stems from the amount of competition that exists in China. Once you have a somewhat successful or seemingly successful business model, you’ll have a lot of competition that comes in. It seems less the case in Silicon Valley.

ZARA ZHANG: So, what would be your biggest three or a couple of takeaways from GGV Fellows?

BO HAN: One of the interesting takeaways was the other Fellows who would have very good job opportunities in the US, they’re very seriously considering coming back to China. And I think that really contrasts with a lot of the people who emigrated to the US in the early-90s and late-90s, basically my parents’ generation. I think the mindset back then was if you could stay in the US, that was your best option.

ZARA ZHANG: Oh yeah. Leave China.

BO HAN: Yeah. I think that’s a really good sign for China that it’s able to attract these people back. Even better sign is if you’re able to attract completely different immigrants. I think that’s a sign of the health of a country.

ZARA ZHANG: For you, do you feel you’re welcome in China? Do you feel like you belong when you’re here?

BO HAN: Yeah, I think so. Although the funny thing is in Beijing, a lot of people ask me, “Are you Japanese? Are you Korean?” Because they listen to my Chinese and they think it’s a little bit off. But I haven’t actually experienced that in Southern China. Maybe it’s because in Southern China it’s like, “Oh, you just have a different accent.” And I think the more someone has spent time in the US interacting with ABCs, the more they’re impressed with my level of Chinese. And then the more someone is actually completely native Chinese, the less they’re impressed with my Chinese.

ZARA ZHANG: You’re a special case for our Fellows. Almost everyone is what we call a Hai Gui or overseas returnee who probably left China from 16 to 20-something to attend college or high school or grad school in the US or other countries. They may have worked in the US for a couple of years and now considering coming back. But you left at a really young age. So, when you were speaking with the other Fellows, did you feel like you had a different perspective on certain things than the rest of them?

BO HAN: I think so. I think for me, even though I don’t purposefully try to do it, I think subconsciously a lot of my thinking is still impacted by American or Western ways of thinking. But I think having grown up in a Chinese household as well, I can understand and sympathize with a lot of Chinese ways of thinking as well. I think things that came up that was interesting to me was when we visited Face++. There were two other Americans in the group, Fischer and Benj, and I think they brought up some privacy issues. And listening to them talk about privacy issues, I could really sympathize with that as an American. But at the same time as a Chinese, I could predict the Chinese response because I lived through that growing up.

ZARA ZHANG: You can identify with both sides. I really think that’s a gift. Most people can only live their life and be one, not the other. But we’re living in an age where you can actually be both and sympathize or empathize with both sides of the story and identify with a larger set of people.

BO HAN: That was really one of the biggest takeaways from living in Indiana. Previously, when I was living in the US in Hawaii, Hawaii’s a very Asian state so if you’re Chinese, you’re just part of the majority culture. Then after moving to Indiana, even though I grew up as an American, people saw me as a Chinese. So, then I ended up having to explain a lot of Chinese culture and people would have preconceived notions of what Chinese people are. And then also when the 2008 Olympics happened, they would ask me, “Did you know the Chinese gymnasts are faking their ages and stuff? What do you think about that?” So, I think living in the Midwest actually really shaped my identity as a Chinese person. It really reinforced my sense of, “Okay, maybe I’m not completely American.” Maybe if someone grew up in San Jose or the Bay Area where everyone else is an immigrant, maybe their understanding of what an American is would be very immigrant-American.

ZARA ZHANG: So, was it a difficult decision for you to move to Beijing because you have not lived here for over a decade?

BO HAN: No. It wasn’t difficult at all. I think what really helped was the fact that my parents had moved back to- or they moved to Hong Kong in 2012, so I no longer had any family in the US. And then also, coming to Beijing, I’m working on my startup with my cousin. So, I think just having that family support also really helped. And then also when I was working in the Bay Area and LA, I was pretty frugal, so I saved up some money. I think that helped with the risk part.

ZARA ZHANG: And you see yourself here for at least a few more years?

BO HAN: Yeah. As long as funding doesn’t dry up. Yeah, I’ll try.

ZARA ZHANG: Could you talk a little bit about the startup you’re running?

BO HAN: Yeah. We’re targeting a zero to six age range.

ZARA ZHANG: What’s the name?

BO HAN: It’s called Qianqian Mama 千千妈妈. We’re focused on the zero to six age range and mostly developing Mini Programs that focus on content and then also games that center around that content, so trying to expose Chinese kids to English content and then trying to reinforce the concepts that they’re learning.

ZARA ZHANG: And you say you’re mostly building a product around WeChat Mini Programs. That’s quite different from what you used to work on in the States. Did you have to learn everything again?

BO HAN: I think the fundamental programming aspects are pretty much the same no matter what new framework comes up. But definitely the details of implementation are different. I had to go through a lot of documentation in Chinese which involved looking up a lot of words, and then also going through different tutorials, and then also learning how developers in China work. Where do they go when they have questions about bugs or how to implement something?

ZARA ZHANG: So as long as you’re a good, smart engineer and you can read Chinese, it’s not that difficult adjustment to move here?

BO HAN: No. Because I think fundamentally most programmers are lazy which is a good thing. So, whenever you hear this completely new framework, it’s usually built around something that exists already because it doesn’t make sense to reinvent the wheel. So, WeChat Mini Program sounds completely new, but it’s actually built on JavaScript and WXML which is similar to HTML and then also WXSS which is like CSS. So, if you’re familiar with web programming, it actually is pretty familiar.

ZARA ZHANG: Is there any last word you want to say maybe to either our audience or prospective GGV Fellows applicants?

BO HAN: Yeah. I think given my background, I really want to encourage other Chinese-Americans or members of the Chinese diaspora to really keep in touch with China, understand history, especially recent history, maybe why your ancestors decided to go abroad. I think that’s really interesting. I also think from a practical perspective, it’s really important to learn Chinese. There’s a lot of unexpected opportunities that you can get just from that language ability. When I was in high school, I never would have expected the Chinese tech industry to have grown to this level. And back then, I would never have been able to predict that right now I would be in China, working in China.

ZARA ZHANG: Yeah. But it’s possible because you speak Chinese.

BO HAN: Yeah.

ZARA ZHANG: Okay, cool. Thank you.

BO HAN: Thanks Zara.

ZARA ZHANG: That’s all we have for today’s episode. If you’re interested in applying to attend the next batch of GGV Fellows program in January 2020, please join the 996 WeChat group and Slack channel where all related announcements will be posted. You can join these groups by visiting 996.ggvc.com/community.

HANS TUNG: Thanks for listening to this episode of 996.

ZARA ZHANG: GGV Capital is a multi-stage venture capital firm based in Silicon Valley, Shanghai and Beijing. We have been partnering with leading technology entrepreneurs for the past 18 years from Seed to pre-IPO. With $6.2 billion in capital under management across 13 funds, GGV invests in consumer new retail, social, digital internet, enterprise cloud and frontier tech.

GGV has invested in over 290 companies with more than 45 companies valued at over $1 billion. Portfolio companies include Airbnb, Alibaba, Ctrip, Didi Chuxing, DOMO, HashiCorp, Hellobike, Houzz, Keep, Slack, Square, Toutiao, Wish, Xiaohongshu, YY and others. Find out more at ggvc.com.

We also highly recommend joining our listeners’ WeChat group and Slack channel where we regularly share insights, events and job opportunities related to tech in China. Join these groups at 996.ggvc.com/community.

HANS TUNG: If you have any feedback on this podcast or would like to recommend a guest, please email us at 996@ggvc.com.

Episode 33: Chinese Overseas Returnees (Hai Guis): Opportunities and Challenges

GGV Capital’s Hans Tung and Zara Zhang discuss the opportunities and challenges faced by Chinese overseas returnees (“sea turtles”, or 海归) who are interested in working in China’s tech industry. These are people who were born and raised in China, completed their high education outside of China or have worked overseas, and then have returned to China for opportunities. There has been a growing number of sea turtles in recent year as China’s tech economy boomed and the US immigration policies became less friendly to foreign talent.

We addressed questions including: What are the common pitfalls that sea turtle entrepreneurs run into? In an age where the premium of an overseas education is arguably declining in China, how can sea turtles make the most of their global experience? For aspiring sea turtle entrepreneurs, which verticals should they spend time on?

If you’re an aspiring or current Chinese overseas returnee, we have a special resource for you: we recently compiled a list of 10 Chinese books on tech & entrepreneurship in China that we recommend all sea turtles read before going back to China. These include books on China’s tech giants Tencent, Alibaba, JD, and Meituan, books on practical aspects of running a startup in China such as growth and marketing, as well as books on general Chinese business history. To read the book list, please follow GGV’s WeChat official account by searching “GGVCapital” in WeChat (or scan the QR code below) and then message the word “sea turtle” to that account. We also have a lucky draw for you: If you comment on that article with your story of coming back to China as a sea turtle before April 10th, you can enter a lottery to win a bundle of these 10 books, which will be mailed to you. We look forward to hearing your story.

GGV Capital’s official WeChat account

And, here’s a list of news outlets and resources that can help you stay in touch with what’s going on in tech in China.


ZARA ZHANG: Hi, everyone. On today’s show we wanted to talk about the topic of sea turtles, or Haigui 海归 which means overseas Chinese returnees. These are people who were born and raised in China, completed their higher education outside of China or have worked overseas, and then have returned to China for opportunities. There has been an increasing number of sea turtles in recent years as China’s tech economy boomed and the U.S. immigration policies became less friendly to foreign talent.

HANS TUNG: Actually, some of the most valuable Chinese tech companies were founded by Haigui 海归, and virtually every Chinese tech company has Haigui 海归 in their leadership. Examples include Robin Li 李彦宏of Baidu, Jean Liu 柳青 of Didi, Colin Huang 黄峥 of Pinduoduo, James Liang 梁建章of Ctrip, Lin Bin 林斌 of Xiaomi, Wang Xing 王兴 of Meituan, Zhang Tao 张涛of Dianping, Liu Zhen 柳甄at ByteDance 字节跳动, Charlwin Mao 毛文超 of Xiaohongshu 小红书, Wang Yi 王翌of Liulishuo 流利说, and the list goes on. And we’ve actually interviewed many of these people on our previous episodes, and I recommend everyone check this out if you haven’t.

ZARA ZHANG: So sea turtles face both opportunities and challenges when they come back to China. And indeed they’re more internationally minded than Chinese people who have never lived abroad. They speak better English and they can bring back practices from other parts of the world such as Silicon Valley. But they also face many challenges. Chief among those is a problem called Bu Jiediqi 不接地气 or not connected to the energy of the land. So Hans, what is your definition of Jiediqi 接地气?

HANS TUNG: Practically speaking China operates quite differently from the rest of world. So if you have been away from China for five to ten years, to go back and understand how grassroots people are, how things get done, that’s beyond what’s in the official guidebook. It requires someone who understands what’s going on in the land and what’s the energy of land. So Jiediqi 接地气 is a very common complaint that we hear levied against Haigui 海归 folks.

ZARA ZHANG: I actually encounter this question a lot from my other Haigui 海归 friends like how do I become more Jiediqi 接地气. Because once you have spent so many years abroad, when you come back you naturally just have English words pop up when you’re speaking Chinese, and that might create the impression that you’re just trying to act like you’re more Yangqi 洋气, or more westernized than the rest, when it’s just naturally the way you’re thinking or speaking. So how do you think practically Haigui 海归s can become more integrated into the local Chinese culture and crowd?

HANS TUNG: I think you and I both went through that period. I moved back to China in 2005, 2006. First of all I was born in Taiwan. I grew up in LA, went to school at Stanford, was an American citizen when I moved to China. China is not a place I’m most familiar with. And it’s very easy to use English words in my Chinese lingo every other sentence. It’s very easy to see that in order to become more Chinese I need to do more, which means including take trains to tier 3, 4 cities. You eat all kinds of funny food and be able to remember idioms and old Chinese sayings, read Chinese history books, to be able to recall lessons from the past, to show that you understand how this land works, and you know that China is a vast country with many differences across regions. The more you appreciate China as a collection of many different cities and regions, and know the differences, the more people respect you for understanding how to operate in this environment.

ZARA ZHANG: Yeah, I think that’s a really good piece of advice, because a lot of Haigui 海归s don’t realize how much they have missed out on by not being in China for a number of years. Because China develops so fast and has such a vast amount of history, so the people who stay here actually absorb a lot just by being here that you’re missing out on by virtue of not being here.

HANS TUNG: And it’s very easy to go to China with the attitude that you’re superior, you’ve seen how the West works, you know what’s the best practices from Silicon Valley or New York and you think that you’re better. But in China, since the growth is growing so fast, so much has changed, that your ability to adjust to that and then understand all the lingo is very difficult for someone who has been away, even as a mainlander, to be able to keep up. And the differences are so obvious to people who’ve been around in China, that it’s very hard to win the respect of people when you’re not fitting, or you’re not understanding or don’t appreciate how amazing this growth has been.

ZARA ZHANG: So what are some common pitfalls that you have seen Haigui 海归 entrepreneurs run into besides this hubris?

HANS TUNG: I think if I look at our portfolio companies, either as founders or as managers, people usually think that the shortest distance between two points is a straight line. But in order to get buy in on different departments or different business partners to get something done, you’ve got to figure out what everyone’s own agenda is and find a common ground to make that work. Sometimes that could be conflicting goals and you have to figure out a way to figure out how to move everyone along. The ability to treat people nice, build that relationship, build that trust before you talk about business. It is not just a transaction, but people need to do you a favor so you do them a favor so they could do a favor back later. All that takes work and it doesn’t happen in the business center or in the office.

So in that respect China is no different than any other place you’re trying to make that work. At the same time, China is moving much faster than Silicon Valley and New York. Most people outside don’t realize that. Chinese companies 10 years ago were small and maybe one-twentieth of the size of U.S. companies. These days Chinese companies are similar in size to their U.S. counterparts, and China is the largest internet economy in the world with more consumers than anywhere else. So the speed of change, how these companies grow, look at ByteDance 字节跳动 , for example, the work schedule is five days a week plus one day a week and two weekends a month. And it’s normal. And the work schedule is 9 to 9, sometimes 9 to 12. So the pace of change, the pace of growth, how fast people iterate is much quicker.

In Silicon Valley and in New York we talk about processes. People agree before something gets done and that’s called planning. In China, just getting it done, just do it first, and then if you have a problem you fix it, you iterate, and move on. So you get more stuff done in a shorter period of time, even though the path is rougher, not as smooth, not as organized. But as a result you actually get more stuff, you’re actually more efficient in terms of productivity because you’re willing to spend more time and not talk about as much and iterate fast. The difference in style becomes very evident within a first week of anybody who comes back to take on a job.

ZARA ZHANG: In terms of the decision making process a lot of my friends in the Valley or in the U.S. ask me, should I stay at Google, or Facebook, or Uber, or should I go back to China?  And if I go back, when is the right time? In terms of this decision making what do you think should be the top considerations when these potential sea turtles are considering coming back?

HANS TUNG: I think it gets harder and harder to come back before you are ready. A lot of mainland Chinese students want to go to the U.S., work for a few years and gain some experience. But it is not that easy in the U.S. to gain a lot of experience in a short period of time. Because now Chinese companies like Alibaba and Tencent, each is worth somewhere around $300 to $400 billion market cap comparable to their counterparts in the U.S., it is going to be harder and harder to have a superior position in a Chinese company if you haven’t learned the chops in the U.S. And you’re actually going to rise faster in a Chinese company before. So I would actually argue that it’s important for Chinese students to come back to China as quickly as possible after just working in the U.S. for two, three years, and not worry about what they’re missing out. Just come back and acclimate themselves into the scene, and work hard and climb.

Trying to become someone who was more senior in the U.S. and then come back later is not that easy. You can make it work, but the odds of success actually get smaller the more time you spend in the U.S. in my opinion. Because with so much data available, Chinese innovations, Chinese capability has caught up. Now in the most cutting edge, the most interesting aspects of semiconductor technology, or AI, or machine learning, there are going to be exceptions. If you are really smart in the U.S., you have achieved a level of success in a short period of time in some very cutting edge stuff, you’re an exception to the rule. You can go back to China, accomplish something and expect a higher pay and bigger positions. But if you don’t stay on top within two, three years your utility will go down. What do you think, Zara?

ZARA ZHANG: I think there’s also the danger of just settling in. A lot of people in the Valley or in the U.S., after they stay there for three to four years, they start to think about things like green cards, buying a house, having a family in the U.S. It just becomes harder and harder to move around and consider moving to China. I guess in the 20s people are the most mobile in general. Beijing and China is just such a dynamic place that requires a lot of energy so I often recommend friends around me to go to China when they’re young.

HANS TUNG: You recently move back to China having spent four years at Harvard, prior to that three years in Singapore, and then with GGV the first year in Silicon Valley. What’s it like for you comparing the difference between Silicon Valley and Beijing?

ZARA ZHANG: The biggest difference is just everything multiplies. The amount of people you need to meet, the information you need to absorb, the deals you’re processing, just the sheer amount of stuff that you need to deal with just increases by a lot when you’re in Beijing. Because China is the world’s largest consumer internet market and Beijing is one of the most populous cities ever. So it is very energetic and dynamic and exciting. And I also really like this get things done attitude in China, and this focus on execution above everything else. Because if you don’t execute faster your competitors will. And for every new vertical that pops up it’s like several hundred companies competing for market share. The competition is just so brutal. And I feel one underappreciated aspect is that there are a lot of opportunities for Haigui 海归s interested in emerging markets outside of U.S. and China. So in the past it was more bridging U.S. and China, but more and more it will be bridging China and emerging markets. Because all of these markets are looking to China for business models and lessons.

HANS TUNG: I see the difference between Silicon Valley and the U.S. Typically it is a difference of one to two. For every meeting you have in Menlo Park, in China you can easily have double the number of meetings, which is more people to meet and more people want to meet. Then you touched on the point that more and more founders are coming to China to learn. We actually noticed that as early as 2011, 2012 there were a lot of founders from India that came. These are amongst the very best VCs in India. Since then, in 2013 and 2014, we see a lot of founders, and to a lesser degree some VCs from Southeast Asia that came. And then fast forward to 2016, 2017, we start seeing founders and VCs from Latin America, specifically Brazil, Colombia and Mexico, come to China.

And it’s very interesting to see other emerging markets, sizable domestic markets with rising middle class, lots of urbanization, growing economy, or an economy in transition with volatility, come to China to learn more how Chinese companies have dealt with those issues, and took advantage of those issues and solved some societal problems over the last decade. And increasingly China is a place, especially Beijing, Shanghai and Shenzhen, and to some Hangzhou, these are the four cities you have to go and visit in order to see how Baidu, Ali, Tencent, WeChat, Pinduoduo, Xiaomi, JD, Meituan, Didi, all these companies operate. And it’s just fascinating.

We start seeing more and more Chinese companies, many of them I mentioned earlier, to expand their business beyond China, whether through strategic investments, JVs, or direct operations. We are seeing more and more startups from China having their first market outside of China now, leveraging their experience in China to build a lot of apps, for example, for the Indian market. There is increasingly more need for a Haigui 海归 to play a role. So I think the sooner Haigui 海归 come back to China when they’re younger, when they don’t have the burden of family, the more they can do and make an impact.

ZARA ZHANG: I have also felt that the premium of being a Haigui 海归 in China has somewhat decreased over the past few years. One, because there are so many of us. The number of Chinese students who study abroad increases, and the number of Haigui 海归s also naturally increases. And because the immigration policies in the U.S. have become less friendly to foreign talent a lot more are coming back today. It used to be that, oh, at least you graduated from one of the top U.S. schools or you have worked at Google, Facebook, Airbnb, you’re considered automatically superior to your Chinese equivalent, but that’s no longer the case. Because you’re actually missing out on a lot of the local Dafa 打法, like how things get done in China. You don’t actually understand the Chinese consumer market. Do you agree that the premium of being a Haigui 海归 has decreased and how we can best leverage our international experience in that context?

HANS TUNG: Yeah, that’s a great question. If I look at the numbers, back in 2006, the number of Chinese undergrads in the U.S. was only 10,000. That’s not including the graduate students, just the undergrads. So it’s a lot smaller. Ten years later in 2016, that number went up by 14x to 142,000. If you factor in the size of the graduate students to the group, back in 2016 there were roughly 250,000 Chinese students in the U.S., roughly one-third of all foreign students. So you have that kind of pool of students to go into the workforce in the U.S., and eventually come back to China. That’s a big talent pool of Haigui 海归. But to your point, has the premium being Haigui 海归 gone down? Yes. Because like I mentioned earlier, the Chinese way of doing things is do it first, then you adjust later.

Planning is important, but not as important as getting stuff done, because you’re in a growing economy and you’re in market that’s expanding. It doesn’t matter how you plan, you will know more about the result of your action if you do it first and then adjust very quickly. You become more productive that way. In the U.S. because the market is more saturated and everything you do could be quite destructive to established vested interests, you have to plan and think harder about what you’re doing in order to get some things done, because the market is not growing as a whole.

But China is different. There’s so many things that’s broken, so many things offline that’s not working. You are better off trying things, trying hypothesis, throw it out and get feedback in order to move forward and adjust. And that way of doing is what people in China are used to, from schools, from working in the workforce for the first few years after college. If you don’t have that kind of pace, clock speed, and approach ingrained in you, you’re going to stick out as a sore thumb very quickly as a Haigui 海归. And so how do you navigate and get stuff done so you can leverage your friends, your contacts, your professional network, your alumni base to quickly get these things done? You can’t hide that. It becomes very obvious in the first week, two weeks of the job that the Haigui 海归 will operate at much slower speed, much less efficiently than their counterparts who have been in China the whole time and didn’t leave.

If you go out for a professional degree, whether it’s at Stanford, Berkeley or the East Coast, the sooner you come back the better. And when you come back, how can you leverage what you’ve seen outside to make a difference? Well, helping Chinese companies to expand overseas, dealing with foreign business partners. These are easily areas that when you can speak better English and understand the culture outside of China better, you can add value. For most of the schools the Chinese mainland students go to the U.S. or elsewhere outside of China, there are many students from other countries, other emerging markets who will want to learn more about China. So while you’re outside as a Haigui 海归 you should build more relationships beyond people who are just Americans or other Chinese. Get to know people from Southeast Asia, from Latin America, from India, from Africa, from Middle East.

The more you’re willing to engage people of other races the more it helps you to work with them once you go back to China. So that’s the first thing that people should do. The second thing is, and I will probably be more frank on this. It is not easy, it is not as natural to figure it out for people to work in teams in general. So how do you, in a new work environment, figure out a way to build a team and work well with a team, so that as a team you actually can get more stuff done than in the collection of individuals. It is something that you get to learn when you are a student at Stanford, or Berkeley, or Harvard or other elite institutions. Many of the projects these days are done in teams. And there’s many extracurricular activities in sports and other things that you can do that work in teams. The more you learn how to work in teams, the more you learn how to become a leader in teams, the more you can effective you can be when you come back to China as a Haigui 海归. Those are the two things that are more general.

And specifically, before you go out, figure out what China needs help on, whether it is machine learning, or AI, or semiconductor, or whatever the specific areas. If you happen to have an interest in that when you’re outside of China, learn more about the best practices so that when you come back you can apply some professional knowledge that people in China just haven’t had exposure to. Those are the three ways I can think of for Haigui 海归 to add value while they’re out and be able to do more when they come back.

ZARA ZHANG: Yes, definitely. So when it comes to younger Haigui 海归 founders that have become successful such as Charlwin Mao of Xiaohongshu, and Wang Yi of Liulishuo and others, what do you think they did right?

HANS TUNG: I think first of all, all these are just very smart individuals and they learn extremely quickly. So if they learn from multiple disciplinary fields, education, technology, product, sociology, just more they see it, helps them to come up with ideas and approaches that other people don’t have. If I take Charlwin as an example, when he first went to Jiaoda 交大in Shanghai for college, that’s the first time he ever took an airplane, got on an airplane ride. And that’s when he was 18. Fast forward 10 years later, he has been to 100 different countries already. His transformation as someone who is a Tubie 土鳖 , who came from the ground when he was 18, to someone who becomes a Haigui 海归 10 years later, that transformation is remarkable. His own personal transformation epitomizes the kind of transformation and globalization many Chinese consumers in the tier 1 and selected tier 2 markets. So he acutely is aware what his consumers are going through, and be able to relate, and give them things that inspire them to want more.

With Liulishuo, with Wang Yi, his Google training helped him to figure out how to, using algorithm and technology, solve a traditional education problem. And that’s multidisciplinary in nature. And when he started Liulishuo it wasn’t obvious that leveraging algorithm alone can solve the common problem of developing better English accent, and know what to say in interviews and in a lot of life settings. ByteDance 字节跳动wasn’t as successful as today so it wasn’t obvious that based on algorithm alone you can make a lot of improvements and changes in consumers. But as early as Zhang Yiming 张一鸣 at ByteDance 字节跳动 to take that approach and apply that to a real problem. How to take tens and hundreds of millions of Chinese consumers and turn them to better English speakers. So it is just very interesting how both of them coming from different backgrounds leveraged their life experiences in a way that fits the next wave of where China’s going.

ZARA ZHANG: So in terms of founding startups, what are some areas where you think Haigui 海归s have an advantage over non-Haigui when it comes to either starting companies or working at companies? Which tracks or verticals should they consider?

HANS TUNG: I think the most obvious one these days is Chuhai 出海, or Chinese companies go global. As the population dividend or the mobile internet user dividend from China has decreased, there’s already 800 million smartphone users in China on a population of 1.4 billion. Sure, another 120 million more people could go online but the bulk of the growth has slowed down. And a lot more apps are competing for user time as well. So you can still build interesting consumer companies or apps in China, but a chance of that has gone down. Yet China has gone through over the last 18 years, and throughout the history of GGV, it has gone through a four or five different generation of startups already.

That knowledge accumulated over four or five generations are incredibly useful in other places such as India, that are only starting to experience 4G in the last two years. This is why when you look at the leaderboard of top apps in India, more than 50% come from China, at least as of now. That may not be sustainable. That percentage will definitely go down as the Indian founders get better, and smarter, and more experienced, and they’re extremely quickly which they all do. So for the time being Haigui 海归 can definitely add more value in companies from China that’s expanding overseas. Many Chinese founders have not lived in India, have not lived in Southeast Asia before. So if you have a Haigui 海归 who’s more familiar with these regions, already made friends where there were studying, friends from these two regions, he can definitely help out immediately.

ZARA ZHANG: And I would actually encourage all Chinese students or professionals in the U.S. to actively stay in touch with what’s going on in China. There are a lot of resources these days, and we actually have the benefit of being able to access not just the English resources, but also the Chinese resources. I spend a lot of time just reading tech news in Chinese, reading Chinese business books, history books, understanding contemporary China and also the past. Because I think being from China is really an advantage today. It’s quite lucky to be able to speak one of the world’s hardest languages and have the cultural affinity to the world’s most populous nation, and also the largest internet economy. I think there are a lot of opportunities that come with having this background and we should really make the most out of it by doing something that’s at least related to China. You don’t have to be in China. But I think even if we stay in the U.S. there are just a lot of opportunities to work on China related things.

HANS TUNG: I can see Haigui 海归 in their 20s move to Singapore or Jakarta, spend time in Southeast Asia, or move to Bangalore, Mumbai, or even go to Latin America like Sao Paulo, Mexico City and work. Because the knowledge that one gets from all those different WeChat official accounts, from all the different Chinese apps out there about what’s happening in China are incredibly useful to founders in these emerging markets. So the more Haigui 海归 can play the role of bridge between China and the rest of world, the more value they can generate as they get more experienced.

ZARA ZHANG: So make friends from Southeast Asia, or make friends from Brazil, or India. I think one of the best assets of going to a U.S. college with a lot of diversity is you got to make friends with people that you wouldn’t have met otherwise. And that’s really a huge asset 10 years down the road. Maybe not immediately, but in the far future maybe you’ll do business with someone you met in school. Who knows?

HANS TUNG: I was young once. I’m much older today, but I was young once. And it’s very easy to have this desire to compare with your college buddies to see how successful, or who got what promotion, who got a salary increase, and so forth. It’s very easy to keep a scorecard, because that’s what people are used to doing. And everybody who is a high achieving student did well in entrance exams, did well in school applications. But one has to think of playing a long game. If I look at my own career, the first 10 years was a lot of different things that had lateral movements, but not a lot of vertical jumps. But the next 10 years I did so much more because I had a preparation for the first 10 years. And it’s very difficult for anybody to take a 10 or 20 year view of their career.

I know that China’s growth was one of amongst the most biggest stories in the last 20 years. When you have farming people that went from countryside into cities, there’s not that kind of growth trend that happened anywhere else. Yet, we all think, at GGV we definitely know that China’s model is very exportable to other places. It will be localized, it will be changed, it’ll be innovated upon, but the base, the foundation of what happened in the last 20 years, are incredibly valuable to founders who want to make a difference in their own emerging market over the next 10 to 20 years. If the Haigui 海归s are patient and willing to engage, reach out, learn, share, and get everyone to play better as a winning team, there’s just so much that can be done between China and the emerging markets around the world. So I highly encourage everyone to take a more long term view to their career and their life.

ZARA ZHANG: So in terms of where Haigui 海归s can add value I generally see two paths. One is to help Chinese companies go global, and the other is to help global companies enter China. I think recently, I increasingly get the sense that helping Chinese companies go global is a lot more practical path or has a higher chance of being successful. What do you think?

HANS TUNG: I think it’s difficult for someone in Silicon Valley, in San Francisco, or London, Berlin, New York to understand what’s happening in China. So helping international companies expand in China is not an easy thing. It’s very hard to understand China when you’re not here in China. So if I look at our experience working with Airbnb we have been impressed with how much support the leadership of Airbnb in San Francisco were willing to provide, and what a great job the Airbnb China team led by Tao has done over the last just under one year, with some foundation laid by the earlier team. But it has not been an easy path. Yet in the last three years you see that a material portion of top apps in India come from China. So the ability of Chinese companies and apps to make a difference in oversea markets in the short term is much greater. So if I were a young Haigui 海归 in their 20s, I would spend time helping Chinese companies go abroad first.

ZARA ZHANG: And we at GGV actually have a lot of resources and programming for Haigui 海归s or Chinese students and professionals who are living overseas. So recently we organized a program called GGV fellows which is designed for sea turtles to get reacclimated to Chinese startup ecosystem and business environment. So during a program we had 34 global minded young leaders who came to Beijing and completed a one-week intensive training on tech and entrepreneurship in China. So our 34 fellows were carefully selected from over 400 qualified applicants, and they come from top institutions from around the world. The most well represented schools were Harvard, Stanford, MIT, and Berkeley. And many of them are working at Silicon Valley tech companies such as Google, Facebook, Uber and Apple. And all of them are native speakers of Chinese or equivalent, and are fascinated by the rise of Chinese internet sector over the past decade. So during the program we brought the fellows to visit the headquarters of eight Chinese unicorn Internet companies, and also heard from 21 founders or executives who shared lessons on what it’s like to start and run companies in China. Our speakers came from some of the most valuable internet companies in China, including ByteDance 字节跳动 , Didi, Xiaomi, Xiaohongshu 小红书, Kuaishou 快手 , Face++, Zuoyebang 作业帮 , Liulishuo 流利说, Keep. Hello Chuxing 哈罗出行, and others.

HANS TUNG: Many of them are GGV portfolios.

ZARA ZHANG: During these closed door sessions the speakers shared not just tips for success but also candid stories of failures and pitfalls that they ran into on their startup journey. So the program is like a lightweight MBA on all things related to China’s tech ecosystem. So Hans, you have interacted with some of the fellows. What was your impression of both the fellows and what they took away from the program?

HANS TUNG: I think when you and I first talked about this idea we have seen fellowship work. At Stanford the oldest VC fellowship to get qualified at Stanford for students to work in startups was the Mayfield Fellowship that happened in the 90s. And since then many of the U.S. VC have started fellowship of their kinds. And in China I think ZhenFund was the pioneer for China in this area as well. When you and I talked about this we increasingly realized that there are just so many Haigui 海归s who could do more in the China setting if they have a better way to bridge them back. And since we have the portfolio companies that are doing well, and many of them employ Haigui 海归, we thought it would be a good way to connect the two resources.

And I gave you and Erica Cai a lot of credit for making this work and putting this together. So kudos to all of you. For GGV, I think having a chance to give a talk to those fellows and meet them in person and have a couple of them at our podcast just confirmed that there’s a lot of talent out there who are multicultural, multidisciplinary. If we can help them to do more, connect with more people who are similar minded, we think that magic will happen, and it will be good for society when more productivity and creativity could happen as a result. So love it.

ZARA ZHANG: And we are going to continue this program in the future. It will likely be an annual program. So in January each year during the winter break of major universities. And if you’re interested in our future events you can join our 996 community by visiting 996.GGVC.com and all of our events and initiatives will be announced there.

HANS TUNG: For the first year it has more of a U.S.-China bent. I think over time we highly encourage qualified applicants apply from Southeast Asia, from India, from different parts of Europe, or even Africa or Middle East, because we want this to be more global and help to connect qualified Haigui 海归s to connect with others from different regions. And over time we probably will expand it. We encourage other ethnic groups to take the time to learn Chinese so that they can participate in a program like this and get an accelerated path to connect with this community. We think that the world should be more about connection, connecting in order to foster more creativity and productivity.

ZARA ZHANG: And in terms of resources we recently compiled a list of 10 Chinese business books on tech and entrepreneurship in China that we recommend all sea turtles read before going back to China. These include books on China’s tech giants, Tencent, Alibaba, JD, and Meituan. Books on practical aspects of running a startup in China such as growth in marketing, as well as books on general Chinese business history. To read the book list please follow GGV’s WeChat official account by searching GGV Capital on WeChat, and the message the word sea turtle to that account. We also have a lucky draw for you. If you comment on that article with your story of coming back to China as a Haigui 海归 before April 10th, you can enter a lottery to win a bundle of these 10 books which will be mailed to you. We look forward to hearing your story. And I also have an article on a list of news outlets and resources that can help you stay in touch with what’s going on in tech in China, which I’ll include in the show notes.

HANS TUNG: Excellent, thank you.

ZARA ZHANG: On the next episode you’re going to hear from two of our fellows themselves, on why they came to the program and what they took away from it. Stay tuned, and thanks for listening.HANS TUNG: Thank you all. Thanks for listening to this episode of 996.

Episode 32: Wang Yu of Tantan on Scaling China’s Top Dating App

We interviewed Wang Yu (王宇), the co-founder and CEO of Tantan (探探), China’s leading dating app. Tantan is social app that help young people in China connect with one another. It has a slide-left slide-right interface. Only when two users both slide right on each other can they start a conversation. The company was founded in 2014 and has helped users make over 10 billion matches to date. In 2018, Tantan was acquired by Momo (陌陌) for $735 million. Momo is a top location-based social networking platform in China that help people meet strangers around them. It is also one of the leading live streaming platforms in China. It is a public company on the NASDAQ and its current market cap is around $6.8 billion.

Wang Yu was born in Beijing and grew up in Sweden. He holds two master’s degrees, one on computer science and one in industrial economics. In 2007, he moved back to China and started his first business P1, a fashion community, before founding Tantan in 2014.

During this episode, Yu discussed how the failure of his first startup P1 proved crucial to the success of Tantan, why flawless execution is more important than flawless product in China, whether any social apps in China will be able to challenge WeChat, and the advantages and disadvantages of being an overseas Chinese returnee entrepreneur.

Join our listeners’ community via WeChat/Slack at 996.ggvc.com/community.


ZARA ZHANG: On the show today we have Wang Yu, the co-founder and CEO of Tantan, China’s leading dating app. Tantan is a social app that helps young people in China connect with one another. It has a slide left/slide right interface. Only when two users both slide right on each other can they start a conversation. The company was founded in 2014 and has helped users make over 10 billion matches to date. In 2018, Tantan was acquired by Momo for around $735 million. For those who are unfamiliar, Momo is the top location-based social networking platform in China that helps people meet strangers around them. It’s also one of the leading live streaming platforms in China. It’s a public company on the NASDAQ and its current market cap is around $6.8 billion.

HANS TUNG: Wang Yu was born in Beijing and actually grew up in Sweden. He holds two master’s degrees, one on computer science and the second one in industrial economics. In 2007, he moved back to China and started his first business, P1, a fashion community which actually I remember, before founding Tantan in 2014. Welcome to the show, Yu.

WANG YU: Thank you. Hi everyone, this is Yu. It’s great to be here.

ZARA ZHANG: You were born in China but moved to Sweden at age seven. Could you tell us about the move, like why you moved there and what was it like for you?

WANG YU: We moved because my father was doing research and he was invited to Sweden to be a guest researcher. He moved there in 1986. After two years there, we decided to move there with the whole family. We moved in ‘88. And it was a very big difference. Back in those days, the world that I knew, it was still in the early days of open up and development of China. So all our furniture didn’t belong to us; it belonged to the people. That’s the kind of surroundings I was used to. When we moved to Sweden, the first 10 years or so we lived in two different immigrant areas which is probably quite different than the Sweden people could imagine. We had one Swede in the whole class. It was kind of like United Nations. I got to get in touch with all sorts of different cultures, so that was very interesting. And in secondary school, because I was interested in math and so on, I went into the city to go to a school with a special math and science class. And that was more like the elite part of Sweden. The difference between the immigrant area called Rinkeby and Östermalm, which is the most central part of Stockholm, I would say that’s almost as different as between China and Sweden. So I got very big clashes of how to look at the world which I think has served me a lot in life.

HANS TUNG: Good. How so?

WANG YU: You’re forced basically to look at the world with different views. And it’s often drastically different. Each one has their own reasonings which make sense from their own perspectives and narratives. And you get to, early on, get acquainted with the whole notion of narrative because there is a whole history behind why you think a certain way. So you stop looking at things in terms of black and white. You kind of have to.

ZARA ZHANG: I remember Liu Zhen said the same thing on our show when she talked about her experience of going to high school in the US.

HANS TUNG: Right. In 2007 you decided to move back to China. I lived in China, worked in China between 2006 and 2013. What prompted you to move back to China back then?

WANG YU: Right between college and starting to work, I worked for a while at Sony Ericsson. I started to have a lot of business ideas. Because I was doing some VoIP work in Sony Ericsson and my manager there wanted me to join his own company to do VoIP for solving roaming between countries. And I came up with this idea of how to reduce the costs significantly through VoIP. Basically, it’s a solution where before you go on the airplane, you redirect your number to our server locally. Say you travel from Stockholm to Beijing, then you transfer it to our Stockholm number. And when you arrive in Beijing, you buy a new SIM card and then you send us an SMS telling us what your new number is. And all calls to your Swedish number will get routed to your Chinese number. So you pay two local fees. And when you want to call out, if you call a Swedish number, you just call from your normal Swedish phone. If you call a Chinese number or any foreign number, you call our local server in Stockholm and then you pay two local fees again. So instead of paying somewhere between RMB 6 and RMB 12 per minute, it becomes less than 1. And no one to this date I think has a solution like this, although roaming is much less of a problem because cost has been reduced significantly. But back in those days, this would be very new and would solve quite a big problem. So we filed for a patent and we wanted to do this in a company. The manager went as far as to offer me a CTO position with a 20% stake in the company. And for me it was like, okay, so it wasn’t harder than this. The whole solution took me a week or so to invent.

Something snapped and I understood that for any business, what you need to do, especially if you’re more or less savvy in terms of tech, you find the pain points. People complain about stuff all the time, so if you find anything people complain about, that’s a pain point. And you solve it with technology and you find a way to charge money. There’s a business. Business ideas were coming up every day in every conversation, so it felt like I was bound to start a company. And I wanted to go back to China because, even though I was quite comfortable with the Swedish culture – I have a lot of friends who are Swedes – I still felt more Chinese in terms of values and so on. And I like China more. So I wanted to go back to China, wanted to start a company. And I think of the Chinese people in Stockholm – there’s not that many Chinese people in Stockholm – I think me and Sophia were the only ones I knew of that both wanted to start a company and wanted to go back to China. So we naturally started to look for business ideas together and that’s why we did it.

HANS TUNG: Right. I remember P1 back then. It was a very cool fashion website. It was the first website in China that had a black background color. And it was cool, but I never reached out to contact you because I thought, well, maybe it’s too early for its time. There are too many diaosi users in China, very grassroots or mass market. The people who can appreciate P1 will be very niche and only in Beijing and Shanghai. What were your lessons from doing P1? Why did you do this particular concept and this user interface? And what did you learn after doing it?

WANG YU: The reason we did P1 as we did it, the major reason was that Sophia had been away from China for four years at the time and I had hardly ever lived in China. We thought that if we would just flat out compete with the grassroots entrepreneurs in China, we would just lose. We would have to come up with something different. And back in those days, and to a high extent, still, a lot of the business ideas were borrowed from the US. Our stuff, we were coming from Sweden, and we were pretty sure no one had seen anything like this in China. So even if they saw our product they wouldn’t understand it.

ZARA ZHANG: Could you describe the product a little bit?

WANG YU: It was like a high-end fashion community. And it was invitation-only. That’s why it was kept very high-end. We had a lot of street style photographers who would scout for people who were really stylish in and outside of high-end shopping malls – they were just exploding all over China at the time – and then they would ask if the person wanted to get a street style picture taken. And we were so picky that people really wanted to. A lot of people dressed up just to get snapped by us. Once we took the picture, we took their contact info and invited them, and only if they sign up to P1 would they be able to get their picture. So conversion rates were super high. It was like 80%. And the photographers were paid for each qualified user they actually generated. It was not based on the working time or the photos. It was based on the amount of users we got. So user acquisition cost was around RMB 15. But RMB 15 for that quality of user was actually pretty cheap.

HANS TUNG: It’s very good.

WANG YU: So we got millions of users. To give an example of the quality of the users, at one point Lamborghini did an event, an offline event, and they wanted some fashion people, so they asked us to invite 30 users. And we didn’t think too much of it so we sent out emails to random users and we got 30 users to come. At the event, one of them bought a car. That’s the quality. Because think about this, people who went to Guomao and Xinguang Tiandi in their 20s were really stylish at that time. They have a lot of purchase power. So even though we didn’t have so much traffic, all the luxury brands were clients with us. We did generate significant CPM numbers. It was over RMB 1,000 CPM. But at max I think we had like 20,000 DAU, so it wasn’t a big business.

We took three main lessons from the whole endeavor. We really tried. We tried for seven, eight years with all sorts of different pivots in P1 to try to get it to work, but we just couldn’t. The three main lessons were, one, it was too niche like you said. We thought that even though this is a niche market, but China has so many people so that is still a big market. But if you do China internet, you want to get the mass. That’s the value of Chinese internet. So we neglected that. That’s one. The second part is probably more important and that’s the pain point. Not very strong pain point. Fashion socializing is something you can live without. If they don’t have a problem, it doesn’t matter how good the solution is. And the third part is the product was too heavy. Since we didn’t have a killer feature, we tried to compensate that by adding more features. And that’s not a good way to try to succeed with an internet startup.

When we did Tantan, we wanted to not repeat these mistakes. We wanted to go for a super strong pain point. We spent quite a lot of time trying to define that. Our positioning is solving singles have a lack of channels to meet people. That’s our positioning. It’s neither for hook-ups or for getting married because those are actually sub-portions of the market, quite small portions to be frank. Even though for guys there is a quite higher level of acceptance for hook-ups, for girls still in China and Asia, it’s not as pronounced. We’re talking about 5-10% of the female market which heavily limits how big you can be. If you define it as meeting people if you are single, that’s something everyone has a need for. By doing that, you open up the whole marketspace a lot, the whole TAM. So that’s how we defined the pain point. And it’s obviously a big mass market. The third part is that the product is very simple. But the product, even though being simple, it fits the Asian and especially the Chinese culture very well, I think much better than it does for the Western culture. That’s because Chinese people don’t have a flirting culture, so they can’t really solve the problem offline, for most of the people in China.

ZARA ZHANG: They feel awkward.

WANG YU: Yeah. It’s indecent to approach someone you don’t know. It’s still like that in the culture even though dating is very accepted. Having a lot of girlfriends, boyfriends before you get married, that’s totally fine. But getting in touch, that first step, is very awkward. That’s why there are hardly any parties in college, for example, and most people don’t go to clubs and bars. And if you meet someone on the subway or in the mall or so on, you don’t talk to them. You do that in the West, but you don’t do that in China. So how do you actually meet someone? That’s one issue. The second issue is that most Chinese young people are not in their hometown. They’re in a different city. That’s quite unique. They’re either in a different city to study or to work. They’re much more lonely because they don’t have their family and friends there and no one to introduce them to people. It’s usually just go to work, go home, sleep alone, every day. It’s super lonely. So the need is much stronger as well.

The Tantan product, even though being very simple, it fits this problem quite well because you never need to flirt. You never need to take the first step because when you slide someone left or right, that person doesn’t know. They only know if you like each other, and then both take the first step at the same time. For a guy, you never expose yourself. You never get rejected. There’s no face issue. And if you do get matched, talking to the girl is not indecent. You’re very confident. You know that she’s interested. For the girl, she doesn’t get harassed. She doesn’t get bothered, spammed by a lot of guys. And the girl also has a super high success rate. According to our numbers, guys like 60% of the girls they see. Girls like 6% of the guys. There is a ten times difference. So for the girls, it’s almost like an assured match if they like someone. They feel like the emperor flipping the hearts. And the third thing for girls is that they can be proactive. Socially, the females, even in the West, they’re waiting for the guys to approach them. They can be proactive. It’s a completely even playing field. They can choose who they like. And that’s something they usually can’t do. The people approaching them in real life are often not the ones they like. In Tantan, the ones they like has still a 60% chance of matching with them, so the user experience is very good. So even though our product is very simple – it’s basically just flip some cards and chat – it solves this major barrier of initiating the first contact which I think is a much bigger problem in China than in the West.

HANS TUNG: There have been many dating websites and then apps in China as well as outside of China. When you were doing Tantan, what were the features that you were thinking of that’s different from everything that’s out there? And what are the features that are distinctively Chinese that a Western app wouldn’t be able to satisfy?

WANG YU: I don’t think it’s so much about what features you have as opposed to how you operate the whole service and what kind of values you have while doing that. When we did Tantan, there were 100 products doing more or less the same product. And they all failed. And they failed not because we were doing a good job and out-competing them. They failed because they were doing a bad job. And even though I don’t think to this day that it’s really that difficult, it becomes very difficult if you don’t have the proper experience. And we only gained the experience by basically failing with P1 for seven, eight years. We basically made all the mistakes we could make and we succeeded by not repeating them. For a new startup, for new entrepreneurs who haven’t made those mistakes, I think you would need to have a lot of luck to avoid them.

For us specifically in this kind of service, first off you need to decide is everyone going to see each other only once or are you going to repeat the people you see. Since you don’t have too many users in the beginning, most startups choose to repeat. That’s a bad idea because if you like someone, you don’t need to like them again. You’re just waiting for them to like you back. If you see them again, it’s just a waste of your time. If you don’t like someone, you really don’t want to see them. What you want to optimize for is time efficiency, the amount of time you spend versus getting someone you can meet offline that likes you that’s a proper person. That’s what you want. So you only see each person once. The second is that you want to see fresh people. You don’t want to see people who were active three months ago. That’s also a big issue for a new service since you don’t have too many users. In many of the other services, you see people who were active three months ago and then you feel like it’s a ghost town. We decided early on you can only see people who are active maximum within 48 hours. They have to be active within 48 hours. With those two restrictions, then you can understand what you’re doing. I don’t think hardly any of the competitors we have realize this. In Tantan, each person slides 200 cards on average per day.

HANS TUNG: 200? That’s a lot.

WANG YU: 200. Since day one it hasn’t really changed. And if each person slides 200 cards and you only see each person once and you want to see fresh users, what does it mean for a new service? It means that locally, within the city, you have to grow by 200 guys and 200 girls a day for this to be sustainable. But at the same time, if you do grow by 200 guys, 200 girls a day, no one will hit the bottom of the stack. Because most users aren’t active every day. They are active, on average, maybe every second day. So 200 in terms of new growth is enough per city. And if they don’t hit the bottom of the stack, they don’t care if there’s one card left or a million cards left. You’re essentially operating as if you were dominating the market already in terms of user experience. So you can very early on give users that user experience. And since we had this offline street style acquisition experience, we could get good-looking guys and girls offline. We just skipped the whole street style part. We just used male and female models, male models to attract good-looking girls and female models to attract good-looking guys.

HANS TUNG: That’s the concept of yunying or operations.

WANG YU: Yes. If you get that part right, you get the city to live. I don’t think any of the competitors, of the 100 competitors, managed to do that. We first did that in Beijing and then in Chengdu. It didn’t work in Shanghai. That’s very interesting. Shanghai people, they’re too snobby for this offline thing to work. So we got Beijing, and Chengdu was awesome. That was the early experience. In Beijing, for example, you get 10 matches as a guy. You talk to all those 10 girls, maybe 5 will answer you. In Chengdu if you get 10 matches, if you don’t say anything, 5 of the girls will talk to you. That’s how big of a difference there is between cities. Once you get Beijing and Chengdu to work, we had this problem, how do we handle the rest of the cities? If we had to, offline, get each city to work, that’s a massive investment. It doesn’t feel like it’s going to scale that well. So something we tried that was very interesting was that we changed the maximum distance from 100 km to 100-plus km. 100-plus means infinite.

HANS TUNG: That’s a pretty long distance.

WANG YU: That’s the single biggest optimization we have done in the history of Tantan. Just that single change made everyone active. In a small city, before, you could maybe flip five cards and then you’re out. Now you can flip those five cards and people in the other surrounding cities. And if those were not enough, you could see people in Beijing and Chengdu who were super happy users. Even if you were not so happy, as long as you interacted with happy users, people tended to not care so much about location, much less than we thought. So immediately, we got the whole China to be as active more or less, in terms of retention and so on, as Beijing and Chengdu. We then went to just do online promotions from that point on.

ZARA ZHANG: The atmosphere of the whole company was uplifted.


HANS TUNG: So what was the maximum distance? You said 100-plus km.

WANG YU: 100-plus is like infinite. It’s actually, I think, 2,000 km. Half China.

HANS TUNG: 2,000? Wow. That’s like 1,200 miles. That’s big.

WANG YU: Yeah. You still see the people closest to you first, so if there is a lot of people close by, you don’t notice that limit. It’s only when there’s not people around that you notice the limit.

HANS TUNG: But how do you date when you’re dealing with someone who lives far away from you?

WANG YU: Early on, there were plenty of users who took a plane to meet their dates. It’s insane. The first day, since you can only see each person once, we had one of our own female employees who ran downstairs. We were like, “What’s up?” She bought a new SIM card to register a new account because she mis-swiped a guy. She wanted to swipe that guy yes. And within the first month, we had the first married couple who wrote us a thank-you email. That’s how efficient it is. It’s quite amazing. That’s one. And the other part with China is that, for example, if you look at Western dating apps, they usually connect to Facebook. By doing that, they get a lot for free because Facebook profiles are very good. First of all, at least in the West, it’s almost always of the real person. And it’s of the real person in a live situation. It’s not trying to look good. It’s quite authentic. It actually works better than the profile pictures you upload for a dating app. That’s one. The second is they get their contacts for free. They get their Facebook friends for free, so they know who their friends are. They also get their profile information for free. The only thing you need to do, basically, is write a description of yourself. Everything else you get for free. Also, you get a much higher conversion rate from downloading the app to signing up because it’s a one button press.

In China, obviously you can’t do that. And since the Western apps, half their success is because of this connection to Facebook, if you want to get this to work in China, you have to find a way to emulate that success. That’s also something that I don’t think any competitor really got that right. From the first day, we manually moderated all user profiles. We removed all profiles who did not have a proper profile picture, which is like 40% because that’s how China is. And you obviously can’t use WeChat because WeChat is even worse than 40%. Every user when you sign up, you’re actually invisible. No one can see you. You can swipe the other users, but no one can see you. But our moderation is quite efficient, so within a few seconds someone will have looked at your profile. If you pass then people will start seeing you. It’s seamless. You don’t need to know. If you didn’t pass moderation, you’ll get the prompt saying you can’t use this, and you have to change your profile picture. We did that from day one.

HANS TUNG: So your system automatically pings users. As they become more active, they need to contribute more to their own profile.

WANG YU: Yes. On Tantan, no one has ever been seen that has not manually passed moderation. That’s a very big sacrifice. So far I think we have probably killed off like 80 million accounts.

HANS TUNG: Because it’s not compliant. It doesn’t show enough.

WANG YU: Yeah.

ZARA ZHANG: And how do you have enough manpower to do that manual moderation?

WANG YU: We have hundreds of people doing that by now.

HANS TUNG: And this makes sense for you because, like you said, most users end up looking at 200 photos a day, so you want to make sure that these are high-quality 200 photos.

WANG YU: Yes. You don’t want to see a water bottle. If you do that, your excitement goes down a lot. So we had to do that. Then we had to develop a profile information system for users to fill in their profiles, otherwise they’re just a profile picture. They need to feel more alive. So we have profile tags. And I think it’s like 85% of the users fill in those tags, over 10 tags each. It’s also quite a big success in terms of that product. And then, since they sign up with their phone numbers, we use their phone address book instead of the Facebook contacts. What we do there is that we block all your phone contacts. And that’s why people give us their contacts. Almost everyone gives their address book because they don’t want to see their coworkers or their boss, or them to see them. But we push people who are secondary degree contacts to them. Friends of friends are actually okay. That’s how we use the address book.

ZARA ZHANG: It’s opposite to a lot of social apps where you sign up and they automatically ping your whole contact list.

WANG YU: Yes. That’s horrible for a dating app. That’s what I mean. You can call it features but I think it’s more like operational rationale.

HANS TUNG: Yes. It’s definitely how you operate, how you yunying and you carefully think through the usage cases and make sure the user experience is optimized.

ZARA ZHANG: For your moderation, do you use automation like machine learning?

WANG YU: We’re looking at that now but so far it’s all been manual. That’s the thing with China. It’s quite cheap. The funny thing is that we looked at some external AI solutions for doing this which everyone else uses, and it’s actually more expensive than using moderators.

HANS TUNG: Well, like you said, in the West, Facebook is so popular so you can automate this. You don’t need to yunying (operate) it. In China you can’t, so you have to be able to do that.

ZARA ZHANG: How do you prevent people from just moving the conversation to WeChat once they meet on Tantan?

WANG YU: Our rationale there has been we want to maximize user experience, so we don’t want to prevent them. That’s a natural need. Would we prevent them from exchanging phone numbers? That’s silly. And WeChat is probably more convenient than phone numbers at this point. We’re a dating app. The problem we solve, like I said, is for singles to meet people. We’re not solving the whole keep in touch with your friends part because that would be just directly competing with WeChat which is stupid.

ZARA ZHANG: Yeah. And WeChat is not good for meeting new people.

WANG YU: No. That’s intentional. Their biggest issue is that it’s getting diluted, and dating is a heavy diluter of friends management. So they don’t want that.

HANS TUNG: Right. It’s very weak ties.

WANG YU: Yeah. So we’re not competing. They don’t want to compete with us. We don’t want to compete with them. Another thing is that even if they exchange WeChat, the conversations tend to be quite short-lived. Because it’s not a friend you met. This is a potential girlfriend or boyfriend, so either it works out or it doesn’t. If it works out then that’s one person that you got. If it doesn’t work out, you never talk to them again. So it doesn’t really matter if that thing happens on Tantan or WeChat because it’s not a long-term relationship.

ZARA ZHANG: Could you discuss the monetization strategy for Tantan? And would you monetize the same way if it was a Western product?

WANG YU: In the short term, I think our revenue strategy is very similar to how we would do it in the West. Right now, it’s subscription-based. It’s value-added services. You pay a monthly fee for different sorts of premium features. But it’s a freemium product. You can use it very well as a free user, but if you buy a subscription it’s much better. So that’s what we’re doing and it’s looking quite good actually. I can’t go into numbers but it’s looking quite good. But one of the things with China versus the West, I think, is that the median ARPUs tend to be lower, but you can definitely get the average ARPU to be higher.

ZARA ZHANG: Yeah. It’s a lot of outliers.

WANG YU: It’s mostly about the top 1%.

HANS TUNG: Yeah. The whales.

WANG YU: If you find revenue models where there is no limit on how much you can spend– because the subscription, obviously, if you want to spend more, there’s a ceiling. But if you find revenue models such as in games or live streaming where you can spend as much as you want then there is people spending tens of millions a month. Basically, those are 1% generating 90% of the revenues. You significantly increase the average ARPU. Those are things we are going to look at going forward, but there is no need for us to be too aggressive about it yet because we’re still mostly growth-oriented. It’s mostly about growth still.

HANS TUNG: If you look at the profiles of the most active users on Tantan, are they all just young users or are they different profiles, different kinds of users?

WANG YU: We used to be very much about very young people, but it’s been expanding. It’s more expanding towards all sorts of people, but it’s more of a focus around young people.

HANS TUNG: How young are we talking about?

WANG YU: I think the average age used to be 22. Now it’s 25.

HANS TUNG: Interesting. It used to be people in college. Now it’s people who have been out of college and working for a couple of years.

WANG YU: Yeah. We’re seeing a lot of surge of users who are 35-plus and so on as well.

HANS TUNG: Good. And for those who are 35 or even older, what has attracted them to come?

WANG YU: The thing is, like I said, there are really no alternatives, neither online or offline. So if you want to meet someone, if you’re a single or a divorced person or something, that’s a gangxu. That’s a super pain point. You have to solve it. So as long as they know about us, they’re going to try us out.

ZARA ZHANG: How do you think dating culture has changed and do you think Tantan contributed to that change?

WANG YU: I definitely hope we have contributed to the change, but I think the revolutionary service was really QQ. They opened up this whole web friend notion. It’s like QQ, Facebook, WeChat in the early days were all about dating. And they were smart about it, so they quickly switched over to friends management which is much larger. For us, since WeChat already owns that market, it doesn’t really make sense. That’s how they did it. But early on for QQ, it was all about strangers. No one had any friends. People my age that I know of who grew up in China, half of them met their partners through QQ. That’s how big I think it is.

So I think the whole online romance thing was really revolutionized by QQ. It has been widely accepted among the population for years. That’s nothing we really made any difference to. I think what we hopefully contributed to was that we made it easier in recent years. Because in the recent years, there has not been too many good solutions. I wouldn’t say we are that awesome either, but we’re definitely better than most of the competitors. Even though I think we have big room for improvement, we’re still better. That’s why we have been able to generate this significant amount of matches, over 10 billion matches to date. And each match is for two people, so it’s like 20 billion match experiences. We don’t know how many people got together because of this, but even a very conservative estimate is tens of millions. And there is like 300 million singles or people who could be counted in that category, so tens of millions is quite significant.

HANS TUNG: Sure. As with any dating app, you need to have effective measures that prevent frauds and harassment and so forth, especially for the protection of the women users. What are the things that you have done that you’re proud of that have worked well? And what are the other new measures you may want to add over time to make the user experience even better and safer?

WANG YU: I can talk in broad strokes about what we have done. I can’t go into details because it’s secret. It’s like a hacker/anti-hacker game, ever-continuous. The spammers and so on, they have a huge supply chain. There are people who are specialized in terms of creating accounts. There are people who are specialized in terms of getting matches. There are people who are specialized in terms of getting those matches to add their other accounts on WeChat. And then there’s another group of people who chats on WeChat to get their business done.

ZARA ZHANG: It’s like an assembly line.

WANG YU: Yeah, it’s like an assembly line, and all four parts are operated by different people. It’s quite professionally operated. I think we even know the offices of where they work. By now I think there’s only one or two players left that still are able to do anything because the tech barrier of being able to do anything is so big now. I think most people just can’t do it. So it’s all about this hacker/anti-hacker game where you prevent them from being able to do each of these four steps. And you have to do it in a way where, even if they know what you do, they can’t do anything about it. It cannot be based on strategies where if they don’t know what we’re doing then it works. If they know then they can just circumvent it. For example, if they build a certain type of profiles and we find a certain keyword and we ban them based on that keyword, then it’s very easy for them to A/B test, and they just remove that keyword. By doing this, what we did is that we educated them. We made them better. We made them create profiles in the future that look more like a real person, which is really bad. You don’t want to iterate this. If you iterate this, in the end you can’t catch them at all. It’s kind of like Enigma. You can never use the information you get from Enigma. You have to kill them with other means because the whole thing is that you can’t let them know that you know.

It’s quite complicated, but in the end you have to use methods where even if they know what you do, there’s just no way around it. It’s a hard block. For example, they buy bunches of phone numbers, like 10,000 sequential phone numbers. So if you see certain patterns in the phone numbers, you ban all 10,000 and it becomes much more expensive to buy those numbers. Stuff like that. And we have probably implemented thousands of different rules and different AI formulas for how to catch them. It’s actually quite difficult to operate a spam account in Tantan. I think we have probably done this better than any other player in the social sphere and I include all the friends management services out there. We talked to the people managing anti-spam on WeChat and they were scared of how high we set the bar. 80% of the people we kill off are not even defined as spammers on WeChat. The result is that you don’t actually see that many spammers on Tantan, at least compared to most other services.

ZARA ZHANG: In 2018, we all witnessed this so-called fengkou or peak for social apps in China with a lot of companies launching new chat apps or social networks and investors pouring a lot of money into these products. But it’s commonly agreed that it’s still very difficult to challenge the dominant position that WeChat has in all Chinese people’s social lives. Do you think startups in the field should seek to challenge at all or should they just work with WeChat?

WANG YU: I think social is a pretty broad concept. This fengkou we’re referring to, I think part of it, where we’re talking about socializing with strangers, that erupted because of our acquisition I think. People suddenly saw, okay, you can actually succeed with a social app and there are actually quite good exit opportunities. That’s, I think, more than half to the fengkou. And then the other part, which is people doing the friends management part trying to challenge WeChat, that I think is much more difficult. I wouldn’t say it’s impossible. I think there’s definitely opportunities out there because to date there has not been a proper implementation of something like Instagram or Snapchat in China. People failed for years with doing Facebook in China until WeChat got it right. You had Kaixin. You had Weibo. People were debating whether Facebook with the whole friends feed is something that works at all in China. And obviously it works. It’s not about if the concept works or not. It’s just about if you are able to operate it correctly, like I said with Tantan’s case as well. Social is quite difficult. You have to really get into the minds of users and then you have to implement a simple solution. So I think you need a lot of experience. Zhang Xiaolong had a lot of experience before he did WeChat.

HANS TUNG: A lot of experience. WeChat didn’t come out of nowhere. He did Foxmail for a long time.

WANG YU: Yeah. I think you need entrepreneurs like that who know what they’re doing. For example, I think if Wang Xing would try something like that, he would have a pretty good chance. He knows his stuff with social. But there’s not that many entrepreneurs who really have that insight. For us, we failed for seven, eight years to learn what we learned. There’s not that many people with that experience. If you do e-commerce, you really don’t become much better at social. That’s, I think, the biggest block. You need the right kind of entrepreneurs and you need a lot of luck. That combination just hasn’t really happened yet.

HANS TUNG: Only very few can do it. Maybe you can do it again or someone like Alex Zhu or Louis from Musical.ly if they come out and do it again maybe. It’s just not many people who can do it.

WANG YU: Yeah, exactly. There’s not a lot of people. And you need a lot of luck. And WeChat, I think, is much more dominant than Facebook is as well because they have the whole IM part. And IM I think is even more important than friends feed.

HANS TUNG: Earlier you mentioned that when it comes to ARPU for Chinese users, the median ARPU is low but the mean could be high because of the whales on the high end. In terms of monetization, you also mentioned that maybe gaming or live streaming are better ways to capture the whales and get them to spend without much upper limit. So when it comes to monetization for you, why did you choose not to build that out yourself and instead decide to sell to Momo who was pretty good at those two areas? And when you were thinking about selling, besides Momo did you think of anyone else like Tencent who also has capabilities in these two areas as well?

WANG YU: The thing with Momo, we were not looking for an acquisition. We were raising our E round. And it was going exceptionally well. I think two weeks after we opened up the round, we already had term sheets and even finished the DD. So we would have been able to close the E round. But at that point, Momo approached us through our financial advisor, China Renaissance. We had never met with Tang Yan before, so we didn’t really know what to expect. It was quite an interesting idea to meet up. And we did it and we hit if off quite well.

HANS TUNG: Both of you are product guys.

WANG YU: Yeah. And, like I said, it’s quite difficult to succeed in the social sphere. You notice that a lot of the philosophies are actually quite similar. Momo has gotten a lot of traction from media and all sorts of people.

HANS TUNG: Tang Yan’s very good. I met him before. I know how smart he is. And he understands social.

WANG YU: Yeah. That was a really good feeling. And the other part is that at that point, we hadn’t really gotten started with monetization, and we didn’t really know what to expect with it. Nowadays, since we have succeeded quite well with it already, we are quite confident. But in those early days, just a year ago, we had less than 10 times what we have now. So we didn’t really know what would happen. And for us to keep growing, we would need to spend much more in terms of marketing. We would need to significantly increase our marketing budget. So the risks were definitely there. And I thought that on the stock exchanges, the market caps of companies were a little bit too high. Very big chance of a big drop. Now it happened just because of this Trump thing, but anything else could also have made it happen and it could have been even worse. If that happened and we would stand there having spent our money on marketing and not really have gotten revenues to grow, we would be in a pretty bad spot. So we definitely had that risk to assess.

The second part is that working along with Momo and Tang Yan, if you look at us today, we are running the company quite independently in terms of the product and operationally. For us, the difference of getting acquired versus raising a round is actually not that different. The feeling is quite similar. And we’re getting a lot of help from Momo. They have a much stronger, much more experienced tech staff than we have. We have a lot of different strengths in terms of how we operate our products, so by exchanging these strengths it’s quite helpful for both sides. Together, we more or less own the whole market. And the value of that versus just competing I think is much better. So that’s how we thought about it and I don’t regret it, even though we have managed to get revenues and so on to succeed nowadays. I think it was a good decision.

HANS TUNG: Alibaba invested in Momo at IPO I think. Did Ali or Tencent approach you as well?

WANG YU: Alibaba was an investor in Tantan too actually. And Tencent is someone we have spoken with for a long time. The issue there, it’s like I said, their main challenge is the dilution. It’s hard to see how we can significantly contribute strategically to Tencent somehow. We can’t really do that much. Regardless of how well we do, it’s more like a financial investment for them. They want to focus more on strategical investments. If we would cooperate with Tencent in the way we do with Momo, we would not get as much help and priority as we’re getting. The synergy would be quite different.

HANS TUNG: Yeah. The synergy with WeChat is not there. The synergy with QQ could, but that will be a very different conversation.

WANG YU: Yes. And QQ is a monster in terms of both the product and the organization.

HANS TUNG: Yeah. There’s not one single person that you can talk to like you do with Tang Yan at Momo.

WANG YU: Yeah. It’s really been a pleasure working with Tuong Nguyen and the whole management team at Momo.

ZARA ZHANG: Has your day-to-day changed after?

WANG YU: Not too much. We do try to extract as much synergies as possible, but we both think it’s better to operate Momo and Tantan as separate products.

HANS TUNG: And when it comes to live streaming and gaming operations, do you plan to leverage their know-how and do more on your own platform?

WANG YU: We’re definitely going to leverage their know-how, but we’re trying to find ways to get inspired by gaming and live streaming to create revenue models that are similar but not necessarily exactly the same. If we do something like live streaming, I want it to be a little bit more hidden, kind of like how Kuaishou does it. Because Kuaishou is probably the biggest live streaming player out there and you could also say they are like a live streaming company, but you definitely don’t feel that they’re a live streaming product.

HANS TUNG: No. It’s a lot more social.

WANG YU: Yeah. If we do something like that, that’s how I want it to feel like. And that’s a challenge but there’s no urgency either. It’s more about growth.

ZARA ZHANG: I think a lot of founders in China, especially the younger founders, tend to have this attachment to what they’ve built and they’re less open to M&A ideas. What is your advice to founders? At what point should you say, I built this but it’s probably better off as part of another company?

WANG YU: I don’t know how blunt I can be. To be just completely blunt, if you do an IPO as a founder, you’re quite far from seeing the money. That’s the major difference. You get a lot of face, but not so much cash. I don’t know if you’re doing a startup for face or for money in the long run. I think most people are for the money.

HANS TUNG: Right. This way you get the best of both worlds. But the trick is finding someone like Tuong Nguyen who can be a partner. Without that, you have to deal with bureaucracy. Then you’re pretty much giving up your baby and taking the cash out and you won’t have much control of the product afterwards anymore.

WANG YU: Yes, exactly.

ZARA ZHANG: For this episode, we experimented with crowdsourcing questions from our listeners community. I’ll ask a couple of questions from our listeners. By the way, here’s a message for our listeners. If you want to contribute questions that Hans and I ask on the show, please join our listeners’ WeChat group or Slack channel at 996.ggvc.com.

Here’s a question from Jenny who is a co-founder of WalktheChat, a WeChat marketing agency. What is the crazy story of managing data in China? What kind of regulatory difficulties have you encountered with regard to data on your platform? For example, users might post revealing photos of themselves. And how do you make full use of data other than for optimizing the product?

WANG YU: Tantan, we try to be a very data-driven company. We ran P1 for many years and we did it in all sorts of wrong ways. But I think in the long run, we felt everything we saw from Facebook made so much sense. So we wanted to operate the product being data-driven. So, run A/B tests. Don’t try to be too top-down-driven. Don’t rely on genius leaders. Get anyone with bright ideas to try out their stuff. And if data-wise it’s good, you launch it. If it’s not, you drop it. And fail fast, fail early. Release early and iterate, that sort of thinking. And aside from that in terms of data, obviously, AI is a big part, so algorithms. And for us, the people you see is based on an algorithm. That’s the key part of our product. That’s obviously a big part of how we use data to try to optimize the user experience for users. But I don’t think of that as having any privacy implications because no one is looking at it. It’s just machine learning.

In terms of other parts, like I said, we manually moderate all user content. So all explicit contents are filtered out. I don’t think you would ever see anything bad on Tantan. But the thing is that since that’s been the culture for so long now, people don’t upload explicit content. I think it’s less than 0.1% of our content that actually is bad in that way. Most of the content we remove, it’s not a person. It’s just a shoe or something. That’s the biggest issue. Explicit content and stuff like that is actually not a big issue. And like I said, spammers, even if they do something, they don’t dare to do anything on Tantan because we have automatic monitoring of user activity. They tend to try to do it on WeChat. Even people saying bad words in chat and so on, it’s a super small percentage of the actual chat. I don’t know if that answers the question.

HANS TUNG: Here’s the next question from Jason Liu, a software engineer at Google. How did you validate your product market fit and get the first round of active users? And what kind of metrics did you use to help you to do product iterations initially?

WANG YU: I think I went through most of that. One part was this offline acquisition of users. One part was that we invited all users on P1 to join Tantan. That’s a unique asset no one else has because that’s basically the best-looking guys and girls you can find in China. We didn’t get too many people to sign up. It was like 20,000. In terms of scale it didn’t make a big difference, but in terms of seed users, you just can’t get anything better. That’s one part. And the rest I described in terms of the philosophy and the operational rationale.

HANS TUNG: I think a lot of people who want to do their own startup underestimate how much learning one has to have the patience to pay for. Without doing P1, you would never have made Tantan work. The idea could be exactly the same.

WANG YU: Oh, yes. We were so far out wrong in so many fields of our philosophies with P1 at different time points that it would just be laughable.

HANS TUNG: And a lot of times, experience from a big company, whether it’s even a Tencent or Ali or Google, may help somewhat, but unless you make your fair share of mistakes and learn from them, it’s not enough.

WANG YU: Exactly. One example: the first two, three years of P1, we were not product-driven nor tech-driven. We were brand-driven. All was about building this high-end brand people would believe in. And we did that quite well, but that’s not how you succeed with scaling an internet company.

HANS TUNG: But without that experience, you wouldn’t have the initial users to do Tantan.

WANG YU: Exactly. There’s no way you can succeed with Tantan with trying to do it brand-driven. There’s just no way.

HANS TUNG: It also feels like no matter what you want to do, you have to do something you personally, passionately believe in so that even if the road you took is different from other people’s route, over time you learn and adjust and everything you did before becomes useful for the next venture.

WANG YU: Yes. Definitely.

ZARA ZHANG: Finally, a question from Ini Wong, a business development professional in Hong Kong who is also Swedish-Chinese. What are the skill sets and values from Sweden that has helped you in building your startup in China? What are the advantages and disadvantages of being Swedish-Chinese?

WANG YU: In terms of first disadvantages, I knew very little about China. And the problem was that I was so bad, I didn’t understand how bad I was.

ZARA ZHANG: You didn’t know what you didn’t know.

WANG YU: That’s a common issue, I think, with most things. I’ve seen many employees or competitors, you’re not good enough to understand how bad you are. It took me seven years to realize that, okay, I don’t understand this market.

HANS TUNG: That’s very honest and fair.

WANG YU: After I realized that, I tried to compensate for that. And it only took a year to start to understand the market much better. But unless you see the problem, it’s hard to solve it. That’s one of the disadvantages. Advantages, I think, like I said, having seen many perspectives of different things, I think you have a much open mind about everything. And Sweden is a very communistic society.

HANS TUNG: Socialist. Socialist society.

WANG YU: Yeah. I think it’s even on communist level.

HANS TUNG: Okay. We’ll see. Maybe that’s a controversial statement.

WANG YU: It’s a culture issue. Everyone is very equal. And that, I think, keeps employees happy. It’s easier to interact with people when you don’t have this bossy attitude. I think that’s one of the things that we have had going for us. We have pretty happy employees generally.

HANS TUNG: You mentioned that you don’t believe in having a genius boss. Everybody can have an idea and use data to test it. If it tested as good, you implement it.

WANG YU: Yeah. If you look at Facebook, most of the stuff that actually made it work were not from Zuckerberg. It’s from just random employees trying out something. The genius of Zuckerberg is trying to build a platform that encourages this and makes it very easy. Back in the days where they were doing just PHP and websites, they could A/B test single lines of code. I don’t think anyone has ever been able to do that except for them.

ZARA ZHANG: And I also think because of your experience living in Western society, you know how dating could be different and how the ways people meet each other could be different. If you only grow up in China, all you see is the Chinese way of interacting.

WANG YU: Oh yes. And also we have gotten a lot of inspiration from Western companies, and I think it’s quite hard to understand them without having my experience from Sweden.

HANS TUNG: I want to ask one more question before Zara goes into the quick-fire session which is, like you said, not many founders have experience living and working overseas in addition to making something work in China. Yet a lot of Chinese models can be exported to other emerging markets around the world. The next new 1 billion users will come from outside of the US and China. What do you think of companies like ByteDance trying to expand in foreign markets? And for you personally, do you feel that either inside Tantan or Momo or something new on your own later, do you want to do something that’s more global in the next 10, 20 years?

WANG YU: The answer to that is just a simple yes, definitely. Once in a time in P1, we tried to define our core values. They didn’t help at all but for what it’s worth, one of them was a global perspective. I think that’s one of the things that makes us different from other companies. We definitely have a global outlook of everything we do, but we have been focused on China so far. We definitely think we have a good shot, both expanding into different areas in social in China and also within dating and social abroad. That’s something we have already started doing some work in, but it’s not the highest priority yet.

In terms of ByteDance, I think that’s a super impressive company. They’re probably the one in China who has implemented this whole Facebook type of operation the best, this whole data-driven, A/B testing, opened up, everyone can try different sorts of things culture and processes the best. They are very aggressive, maybe too aggressive. If there’s anything that would be to their disadvantage, it might be their aggressiveness. But that’s also their strength. We will see how it goes, but it’s definitely a very exciting company and one of a kind I think in the world. There is no one that I’ve seen in the West who are close to their level of aggressiveness.

HANS TUNG: That’s fair. We do see a lot of founders from Latin America, from Southeast Asia, from India beginning not just wanting to learn from US, but increasingly learn from what founders in China have done as well. It’s just super exciting for us to be in the middle of everything and help founders learn from each other. We think that building a global community, global product is a much more interesting way to live.

WANG YU: Yeah, definitely.

ZARA ZHANG: So next we’ll jump into a round of quick-fire questions so you can just say the first thing that comes to your mind. Who is the entrepreneur you admire the most and why?

WANG YU: I would say Steve Jobs. It’s just because he has been able to have so clear visions of what he’s doing and have been nailing them so well and have been able to get his whole team to raise the whole standard to his level and get them to actually ship the stuff on time. I think that also came from his misfortunes that he learned from. He would never have been able to do it if everything just went well.

ZARA ZHANG: What’s a book you’ve read recently that you would recommend?

WANG YU: I have not read too many books recently.

HANS TUNG: Do not have time.

WANG YU: No. San Ti, The Three-Body Problem. I was not too impressed by the first book. And then I was even less impressed by the beginning of the second book. But from the second part of the second book until the whole of the third book, amazing in terms of just the sci-fi part. Wow. I think the people interactions could be better, but in terms of just the sci-fi part, awesome.

ZARA ZHANG: Lastly, what do you do for fun?

WANG YU: I just came from boxing training. I’ve been doing a lot of boxing. Not hitting other people. Mostly trainers with pads. I need to lose weight, so this is super good for that. Aside from that, I don’t know. Watch some movies. Play some games. I’ve basically bought every game you can buy, but I have not played anything really since college days. I used to be an elite Quake player. I played Quake for like 12 hours a day for four years. I was top 10 in the world at a point in Quake 1. But then that took too much time so I quit and haven’t really picked up games too much.

ZARA ZHANG: What do you see yourself doing in 10 years?

WANG YU: 10 years? I have a pretty strong entrepreneurial spirit so I’m probably going to be in some kind of entrepreneurial project.

HANS TUNG: I’m sure you will. But this time will be more global.

WANG YU: Yeah, probably.

ZARA ZHANG: Thank you for your time and we really enjoyed this conversation.

WANG YU: Thank you. It was really fun.

HANS TUNG: Thanks for listening to this episode of 996.

ZARA ZHANG: GGV Capital is a multi-stage venture capital firm based in Silicon Valley, Shanghai and Beijing. We have been partnering with leading technology entrepreneurs for the past 18 years from Seed to pre-IPO. With $6.2 billion in capital under management across 13 funds, GGV invests in consumer new retail, social, digital internet, enterprise cloud and frontier tech.

GGV has invested in over 290 companies with more than 45 companies valued at over $1 billion. Portfolio companies include Airbnb, Alibaba, Ctrip, Didi Chuxing, DOMO, HashiCorp, Hellobike, Houzz, Keep, Slack, Square, Toutiao, Wish, Xiaohongshu, YY and others. Find out more at ggvc.com.

We also highly recommend joining our listeners’ WeChat group and Slack channel where we regularly share insights, events and job opportunities related to tech in China. Join these groups at 996.ggvc.com/community.

HANS TUNG: If you have any feedback on this podcast or would like to recommend a guest, please email us at 996@ggvc.com.

Episode 31: Simon Zhang of GrowingIO: Learning to Grow, Chinese Style

GGV Capital’s Hans Tung and Zara Zhang interview Simon Zhang, (张溪梦), the founder and CEO of GrowingIO, a data analytics startup in China that helps product managers and marketers analyze mobile apps and websites without adding manual tracking codes. GrowingIO now counts over 6000 companies as its customers, including the likes of Didi, Momo, Tujia, and others.

Previously, Simon was senior director of business analytics at LinkedIn in its Silicon Valley headquarters, and before that, worked as a senior manager of site analytics at eBay. In 2015, he left a decade-long career in Silicon Valley to return to China and started his current startup, GrowingIO. But prior to all of this, Simon worked as a brain surgeon in China, and attended medical school in Tianjin. He also obtained an MBA from Baldwin-Wallace College in Ohio. Simon is also the author of the Chinese book 《首席增长官》 (“Chief Growth Officer”) and is a thought leader in the field of data-driven growth in China.

Simon discussed how Chinese engineers in Silicon Valley can crack the “bamboo ceiling”, how Chinese-style growth differs from Silicon Valley-style growth, and why “raising too much money” could create challenges for a startup.


ZARA ZHANG: Hi everyone. For those in the Bay Area, Hans and I will be hosting a 996 anniversary party on Saturday, March 9, in San Francisco. The event will take the form of a China tech trivia night. You will get to test your knowledge of China’s tech industry by answering trivia questions in teams. The winners will be awarded attractive prizes, such as a bundle of the books that out past speakers have recommended on the 996 Podcast. At the event, you also get to meet and hear from some of our GGV fellows on what they learned during their intensive one-week program in Beijing.

This anniversary party is open to all followers of the 996 Podcast and friends in the Bay Area who follow tech in China. The event will be at 7:30 p.m. on Saturday, March 9, in SoMa, San Francisco. The exact location will be included in the confirmation email. You can sign up for the event by following the link in the show notes or by visiting 996.ggvc.com/sf. It will be a fun night and I hope to see you there.

We’d also like to thank our sponsor and partner, OnePiece, for their support for this event. Also, here’s a tip: If you want to win at this trivia night, I highly recommend re-listening to previous episodes of the 996 Podcast, since many of the answers to the questions can actually be found in our show.

HANS TUNG: Hi there. Welcome to the 996 Podcast brought to you by GGV Capital. On this show, we interview movers and shakers of China’s tech industry and discuss how founders from around the world can draw lessons from China’s tech ecosystem. My name is Hans Tung. I’m a Managing Partner at GGV Capital and I’ve been working at and investing in startups across the US, China and other emerging markets for the past 20 years.

ZARA ZHANG: My name is Zara Zhang. I’m a marketing manager at GGV Capital and a former journalist. Why is this show called 996? 996 is the work schedule that many Chinese founders have organically adopted. That is 09:00 a.m. to 09:00 p.m., six days a week.

HANS TUNG: To us, 996 captures the intensity, drive and speed of Chinese internet companies, which have produced many growth miracles over the last decade.

ZARA ZHANG: Also, I highly recommend joining our listeners’ WeChat groups and Slack channel where you can connect with likeminded people interested in tech in China. We organize regular offline events across the world for our followers. You can join these by visiting 996.ggvc.com.

On the show today, we have Simon Zhang or Zhang Ximeng 张溪梦 in Chinese, the founder and CEO of GrowingIO, a data analytics startup in China that helps product managers and marketers analyze mobile apps and websites without adding manual tracking codes. GrowingIO now counts over 6,000 companies as its customers, including the likes of DiDi, Momo, Tujia and others.

HANS TUNG: Previously, Simon was a Senior Director of Business Analytics at LinkedIn at their Silicon Valley headquarters, and before that he worked as a Senior Manager of Site Analytics at eBay. In 2015, he left a decade-long career in Silicon Valley and returned to China, and started his current startup, GrowingIO. But prior to all of this, Simon worked as a brain surgeon in China and attended medical school in Tianjin. He also obtained an MBA from the Baldwin-Wallace College in Ohio. Simon is also the author of a Chinese book, Shouxi Zengzhangguan 首席增长官 Chief Growth Officer, and he’s a thought leader in the field of data-driven growth in China. Welcome to the show, Simon.

SIMON ZHANG: Thank you for having me here, and thanks, Zara.

ZARA ZHANG: So, Simon, you’ve known Hans for a long time. Do you remember how you first met?

HANS TUNG: Yes, I think I met Simon when he was still at LinkedIn or about to leave LinkedIn to explore the possibility of building software in China, even though he has been away for so long. He was figuring out whether he should do a consumer startup or something that’s more enterprise-oriented, and the trade up was that in China back then, consumer startup was the only thing that mattered in the internet space. There are not a lot of proven enterprise examples that worked out. Yeah, that’s his area of expertise, so he’s figuring out, should he work with someone in a consumer startup or start up one with low odds of success, or bet the farm that that enterprise will be a big trend in China?

SIMON ZHANG: That’s exactly right. I remember very clearly when I talk about Hans, he shared a little bit about the China market and the US market. He said, “If you do a B2B in China now, I’m not your investor,” and I remember that quote.

HANS TUNG: It’s not easy. It is so not easy.

SIMON ZHANG: It is not. That’s right, yeah.

ZARA ZHANG: When you started your career as a brain surgeon, at what point did you realize this may not be what you want to do for the rest of your life, and when did you find our passion in data?

SIMON ZHANG: I think this is almost two questions. The first one, I started my career in medical university and then joined a cancer hospital. I think after six or nine months, I figured out that wasn’t exactly what I wanted in my life. And then I told the chief of the department, “I need to leave,” because being a doctor actually is very, I would say, serious a career. I needed to leave that space for someone who really loved the job, but not me just being okay with the job.

And, also, personally, I strongly believe anyone, everyone needs to enjoy what he or she is doing, so that will motivate this person to become the best in the field. So, at that moment, I truly think I didn’t have the passion for being the best doctor in the world, so that’s the reason I left after I think, roughly speaking, a year without anyone’s notice. My family figured it out after seeing me staying in the apartment for two weeks, one week actually. My mom asked me, “Hey, what are you doing here?”

HANS TUNG: Do you have no work? What kind of work did you do down at the hospital?

SIMON ZHANG: Yeah. Is there no patient? Why are you here?

ZARA ZHANG: Why data?

SIMON ZHANG: Why data? Actually, it’s a link to a computer. It was not about the data. It was about the computer. When I was very, very young, that was my toy. I really enjoyed it and starting from a playing video games, I then shifted to computer games and then shifted to internet, very early stage.

HANS TUNG: This was in the ’80s?

SIMON ZHANG: Nineties, and that used this modem to connect to the internet.

HANS TUNG: The early-90s.

SIMON ZHANG: Yeah, almost at $2 per hour. That was the cost. Very early.

HANS TUNG: Yeah, that’s how it was in ’95, ’96.

SIMON ZHANG: Yeah, ’96. I felt this was the most powerful thing that ever happened in my life and I liked it. I enjoyed it and then I wanted to do things in this field. That was in 1998, 1999.

HANS TUNG: Yeah, it was right at the beginning, very early tipping point for Chinese internet to start happening. I remember in ’97 China had less than 10 million internet users. That’s when Jerry Yang visited China and had a picture taken with Jack Ma on the on the Great Wall. That was in ’97.

SIMON ZHANG: That’s the very earliest stage.

HANS TUNG: It was like seven million internet users in China back then.

SIMON ZHANG: Yeah, I remember that part, because before it was 386 or 486 computer models, and that was the first computer I had in my life, and then I decided I needed to do something in this field.

ZARA ZHANG: And you came to the US in 2002, right?


ZARA ZHANG: What prompted the move?

SIMON ZHANG: Because I was very young, I liked American movies and video games, novels, books, but a lot of thing I think finally convert into why America is such a creative country, have so many amazing people, creating so many amazing stories, movies, products and technologies. I just felt this country must have some significant difference from what I knew at that moment. I wanted to learn from them and that motivated me to come to the US at that moment. Yeah, so I think that was the main reason.

ZARA ZHANG: And how did you find your way into the field of data analytics?

SIMON ZHANG: I think the whole world is a hyper-connected behind the scenes, so because those personal hobbies, movies, American whatever, and then at that moment I read a lot of articles about internet, even ecommerce. I felt, this ecommerce is so fascinating, and it has connected the whole world by using internet, and then it also can sell things. Actually, I opened my personal video game store when I was a student. I found this was the best way I could sell things online and I wanted to learn ecommerce. I wanted to do ecommerce. And that’s a reason I started doing some research on how to do ecommerce, how to build a website, because if you want to build an ecommerce, you have to have a database and connect everything together, and I figured it out. I learned and then I wanted to do ecommerce. Then, you see, I shifted my focus from just a computer, internet to e commerce, but for ecommerce I needed to understand data and the database or everything. So, I learned, yeah, and then I started working on this field.

HANS TUNG: And that’s how you got involved in eBay.

SIMON ZHANG: Yes, because I wanted to do ecommerce. Ecommerce at that moment was eBay.

HANS TUNG: eBay and Amazon. Amazon is in Seattle and eBay is in Silicon Valley.

SIMON ZHANG: eBay was the largest at that moment.

HANS TUNG: Yes, at that moment it was.

SIMON ZHANG: Yeah, it was, and I joined them. It was just a personal interest.

ZARA ZHANG: Why did you join LinkedIn after that?

SIMON ZHANG: So, that’s another connection, right? Because I think after three years of working at eBay, I really learned a lot, a lot of amazing people in the department. They were using data to fully operate the site or the business. And the manager who recruited me for that eBay position, he told me, “Simon, this is Silicon Valley. I feel you should go somewhere smaller like a startup.”

HANS TUNG: Right, eBay was already very corporate by then.

SIMON ZHANG: Right, eBay had I think 10,000 employees or something.

HANS TUNG: Which was a lot back then.

SIMON ZHANG: It was a lot, a lot of people. And his name is Heston. He’s a great guy and he told me, “Simon, you should go somewhere smaller.” I didn’t understand what he was talking about. I told him, “Are you kidding me?” I was just getting my promotions in a month. “I feel I could do a lot of things here.” Anyway, he said, “No, no, no, no. You didn’t understand what I meant. You should really go somewhere growing, smaller.” He strongly believed I could do better in a smaller place.

HANS TUNG: Know more, do more and get promoted faster.

SIMON ZHANG: Yeah, and then recommended me to a couple places his friends ran and then I got a couple of offers, and then finally decided to join LinkedIn.

HANS TUNG: Which was very small back then.

SIMON ZHANG: Very smaller, yeah.

HANS TUNG: How many people were there at LinkedIn?

SIMON ZHANG: It was more than 500, definitely less than 1,000, something like that.

ZARA ZHANG: So, you were there for almost five years.


ZARA ZHANG: And you let them build the analytics team to support the company’s monetization. Could you talk about why analytics was important to LinkedIn? And what kind of impact did your team have on the company?

SIMON ZHANG: This is I think the greatest question. Firstly, LinkedIn really respected data. It is it is part of the company strategy or it is part of the company culture. When I was just joining LinkedIn, I remember very clearly, they said, “Growth drives data. Data drives money. Money drives growth.” It’s very simple. I still remember that mode very clearly.

And the second piece is I think LinkedIn really empowered employees in how to use the data. It’s not telling, Hey, Simon, you should do this, this and that, right? You just say, Hey, we want to drive in this type of result and what can you guys can do? And we did a lot of very creative projects and brought significant growth to LinkedIn. About, I think, six months ago Reid Hoffman just published a book called —

HANS TUNG: Blitzscaling.

SIMON ZHANG: Yeah, Blitzscaling. In that, the LinkedIn case he used was the project we delivered at LinkedIn that’s the fundamental internal growth engine to boost the LinkedIn revenue growth, and it’s called product Merlin. It’s like a magician and we built that product internally. I think it has increase efficiency by 3–10 times internally.

ZARA ZHANG: Of monetization.

SIMON ZHANG: Yeah, of monetization, because salespeople wrote me emails saying, “Hey, I don’t know who you are. I really don’t know who you are, but I’m very thankful to you –”

HANS TUNG: Sweet, yeah, not difficult money.

SIMON ZHANG: “– because of what you did, making me upgrade my vacation to Hawaii. Because as a result of your work, I just stay home. Because of your work, my family now goes to Hawaii. Thank you very much.” And I asked him, “What exactly have I done for you?” He said, “I used to close one deal per month. Because of the work that you guys did, I can close three deals in a week. People are chasing me to sign the contract.” Yeah, it was the moment that made me really super, super happy, and the whole team happy. I think that’s the ultimate power tool.

ZARA ZHANG: So, what was the exact reason that the conversion rate increased? Was it because of better targeting?

SIMON ZHANG: Better targeting. Better product and channel fit. Better messaging. Better positioning. The most significant part is the automation. A salesperson, first of all, he wants to talk to Hans, so seriously speaking, he just needs to click three buttons to generate PowerPoint slides. The slides would talk about Hans, GGV, why GGV needs LinkedIn, why the LinkedIn product fits the GGV needs, and who can recommend or liaison between me and Hans, all of that in that PowerPoint.

ZARA ZHANG: A personalized pitch deck.

SIMON ZHANG: A personalized pitch deck which really, really boosts the productivity during the early stage. It used to be two weeks to prepare one, for data analytics to prepare one, but right now it has become three minutes to prepare one.

HANS TUNG: So, data can be just sucked out of the database and be put into that very quickly.

SIMON ZHANG: Yeah. I remember we did some internal data tracking. We found that there were 500,000 PowerPoint stacks that have been done with it, something like that, a year, which translates into almost 2,000 data analysts’ work if we do this manually, and everything is customized for when we’re speaking to our customers. That’s just the beginning, but also, we have seriously worked, connected and then fundamentally changed the way LinkedIn scaled and grew, and it has really made me personally feel proud and happy, because I changed their lives, made them live better.

HANS TUNG: So, you were making a great difference inside LinkedIn. Yeah, many people—and I can relate to this because I’ve worked both in Silicon Valley and China now—have said that there is a ceiling for Chinese and most Asian employees. India may be an exception, but most Chinese employees in Silicon Valley tech feel that there’s a ceiling and it’s hard to move up to leadership roles at VP or higher levels. So, what kind of examples or lessons both positive and negative did you learn while working at LinkedIn as one of the top performers?

SIMON ZHANG: I will start with the positives. I think I will end with a positive as well, because everything has two sides to a story. Number one is, I think the company culture is very important rather than embracing results and performance, and the leadership team can recognize there are so many great people. You need to grow them. I think LinkedIn, at least when I was there, was the place to empower me and give me the opportunity to grow. I think that’s very important for any employee now living in Silicon Valley to find a growing space. However, a growing space is not a free ride or a free vehicle to bring you to the next level. I think, personally speaking, we need to really work hard and deliver better performance than average.

On the other side, I feel the ceiling, the ceiling problem. So, after I came back to China, I understood this a little bit more than when I was there. When I was there, I’d talked about this being just a communication issue; this is just our Chinese being kind of very siloed, not united much. Actually, right now I don’t feel that way anymore or I don’t feel much about that anymore. I feel our Chinese, let’s say, engineers or folks in Silicon Valley, number one, we need to become a T-shaped leader. I think most of time you spend too much time on becoming the expert in this field, but we forget we need to grow our leadership skills.

HANS TUNG: Horizontally.

SIMON ZHANG: We need to grow our management skills. We need to grow our business skills. We need to understand the product, marketing, sales and everything on the customer and the market. If we don’t have those skills, it’s very hard for a person to become the leader for the company, but because he or she will not have the general point of view of how to manage the whole business. I think that’s a very important learning I have.

The second part is, I feel, if we want to grow leadership skills, you’re going to grow management skills. Those kinds of skills are—how do I say it? Maybe that’s not right English term—learnable. We need to learn that. However, if we only learn from our own experience, we will become very fixed mindset people. We have to intentionally expand to our unknown area. That area needs someone really good in this field who coach us, but sometimes when I think of myself, say, seven or eight years ago, I didn’t have the awareness that someone could coach me to become better in that field. Then, when I reached a certain stage, when someone tried to guide me or tell me something I really did not know, I started refusing the lesson, to listen, because those signals were not matching with what I understood. So, I think in this area could be expanded by a much more open-minded mindset. Plus, someone could guide and mentor this person.

I feel right now in Silicon Valley in our Chinese community, there are a lot of more experienced executives or experienced people. If we couldn’t jointly work together, we will end up with much better results, but not just “Simon explored by himself randomly”. Just keep learning from practice. Learning from practice without anyone to coach and guide is kind of —

HANS TUNG: A lot less efficient.

SIMON ZHANG: Yeah, exactly, less efficient. I think the last is our education. I’m not blaming our education system. We weren’t taught much about the methodology of how to learn but taught too much about how to be right on the final results. So, my feeling right now, I think there’s some change that has happened significantly in the past several years. Our Chinese engineers or people who are staying in Silicon Valley, we need to learn the fundamental methodology, but not just how to get the results right. So, I think our education system taught too much about the results, but not teaching us enough how to learn learning.

And, finally, I would say, in the US, we have to get a green card; we have to get an H1B; we have to get meal tickets and paychecks. Those kind of limit people’s ambitions and this desire for being more creative and being more. Actually, right now if I look back, I just had too many fears.

HANS TUNG: Even in LinkedIn?

SIMON ZHANG: Even in LinkedIn, every day, Oh, I’ll lose my job; I’ll lose this, and I’ll lose that.

HANS TUNG: Losing your job.

SIMON ZHANG: Exactly. However, I strongly believe that the US culture really encourages you to have your independent thinking, being creative, being customer-centric, for example, business-oriented. So, it’s okay to speak up. It’s okay to express yourself clearly and then with guts, and that’s what I learned at LinkedIn after nine months. It was the largest lesson I learned in my life. We have to be extremely honest and brutally honest by telling the truth. This, however, I didn’t want because I was sacred or because of the fear or whatever I had in my mind that blocked me off being better. That’s just in my personal life. I’m not saying this should apply to everyone, but I recommend it to others. For example, I would tell them, Hey, these are the lessons I learned. I don’t hope you have the same problem, but that’s what I would recommend.

HANS TUNG: So, when you look at your colleagues of Indian descent over the last two decades, they have done an amazing job, very admirable.

SIMON ZHANG: Absolutely.

HANS TUNG: What are the lessons that we can learn from them? Now you see a lot of them who are senior executives in technology companies and even the academia at Harvard and other places. It just truly remarkable.

SIMON ZHANG: If you look at the top five Fortune 500, especially for tech companies, how many Indian executives are managing the whole business? I would say, communication is just a part of it, very shallow and surface. However, I think deeply culture-wise, they teach business almost across all the levels, and the second is they teach how people collaborate with others. That very important.

I almost forgot—collaboration is one of the most important characteristics of a leader. I think Indian employees know how to collaborate, how to be collaborative with others, how to keep your independence in thinking but also being able to compromise in the final solution. Also, they know how to build a network. That’s very important in the skills, because if you won’t agree on something, you have to a little bit lobby everywhere underneath and then, finally, now reach an agreement. So, I think I had a lot of things to learn.

And, also, my feeling is they understand the ladder a lot better than Chinese employees. Chinese employees sometimes feel if they work hard enough, people will recognize their —

HANS TUNG: Recognize their hard work.

SIMON ZHANG:  — yeah, their hard work. Actually, no, that’s wrong. That’s completely wrong and you do your work. It’s almost like a product/market fit. You only build a great product with other people. No, that’s a failure. You have to promote this product in the right channel and then you need to have this product with the right customer acquisition cost and their lifetime value. You need to figure out all of this. Then, promoting this product is part of the job. It’s not just self-promoting.

HANS TUNG: It’s not self-promoting, right.

SIMON ZHANG: It’s not just playing politics. No, this is how we make a great idea become very impactful.

HANS TUNG: And adopted by other people.

SIMON ZHANG: Yeah, exactly. So, I would recommend that our Chinese learn that. That’s a very important and basic skill for anyone who wants to be successful in a company.

HANS TUNG: Yeah, that’s actually a great lesson not just for our Chinese and folks in Silicon Valley, but it’s a great lesson for anyone young trying to move up the corporate ladder and do more, make more impact on life. Part of the reason that I moved back to the Bay Area in 2014 was because I felt that, like you, I learned a lot from being on kind of a battlefield in China for eight years, and you see so much and see that this is actually and I still think that this is the toughest market in the world to do VC or even build a startup. There are just so many challenges you have to overcome, which we will get to in a second later on in the podcast, that if I learn all these lessons, these lessons are actually not China-specific. They’re great lessons globally and that’s part of the motivation of doing the 996 Podcast. It was to share these kind of lessons. They may start in a China context, but the implication, the application is actually quite global beyond China.


ZARA ZHANG: I think another reason for that phenomena is the self-selection bias. A lot of enterprising Chinese people at Silicon Valley tech companies actually moved back to China to either join or start companies like you did.

HANS TUNG: If Simon ends up being a C-level officer at LinkedIn, would he still have come back to China? Hard to say. Then, this is a part of the challenge that India has. It’s that you have so many great successful Indian executives in the US. Would they be able to give that up just to move back to India? If I were already in the Forbes Midas List five years in a row in the US, would I give it up to go to China? Not so easy. But the interesting thing is that by doing it in both places, the things you will learn become quite powerful in a way that you wouldn’t have if you just stayed in one place.

SIMON ZHANG: That’s exactly right. That’s almost like the story you shared with me, Hans. Remember you shared with me that you did a lot of research on Japanese history?


SIMON ZHANG: You learned a lot. My feeling is that—when you told me that story, at that moment, I connected—if I stay in Silicon Valley for the rest of my career, I will never learn this new language, even this, what we call Chinese. I am Chinese. I came back to the China market. I just learned so much. It’s almost like a new world to me personally. I learned and then, when Hans told me that story, I reflected, The China market for me is almost like the Japanese market for Hans. I was learning in China; he really enjoyed learning Japanese history. I think that taught me how to understand better about our customers, how to deliver something.

HANS TUNG: You decided to come back to China four years ago and you decided to take part in enterprise when it was not clear that if someone who has been away for 10 years could actually build something, an enterprise which is so local, even more local than the consumer market. Against all odds, yes, you’ve built a viable business today. What are the some of the challenges that you had to face and how did you end up solving them one by one? I know you have many lessons, but you can pick two or three.

SIMON ZHANG: We have too many lessons to derive for ourselves.

HANS TUNG: Two or three of the most memorable, most impactful ones.

SIMON ZHANG: I would say, coming back to China, building a startup, building an enterprise startup where being a startup person all of this for me was completely new. I think that the reason we could do this was only because we could hold the personal view. However, if I look back, I would’ve said I should have a better understanding of a product/market fit. I should understand during a different stage what an entrepreneur should do, because this is the first time, I’d built a startup. So, we made a lot of mistakes.

I think the most important one is focus on the customers and the market, but not just focus on the technology we had or the technology dream that we had. Focus on customer and market is the first lesson I would like to share with any who wants to build a startup in any market.

The second lesson I learned is I received too early too much money. Seriously, I raised too much money during the Series A, early stage. That actually clouded a lot of things because we could do marketing, we can do a lot of things—

HANS TUNG:  You could do many things.

SIMON ZHANG:  Yes, many things to boost early growth, however, if I had had less money I would do slightly different. 

HANS TUNG:  How would you do it differently?

SIMON ZHANG:  We’d focus on no marketing in the early stage. Completely focus on customers, and make sure our product filled our customer need in the early stage. Don’t expand too fast.  Control it and make sure everything becomes smooth, product, deployment, service, customer feedback. All the loop had been checked, and then expand.  However, when we had more money, it kind of diluted our focus. At that moment I didn’t even know what was supposed to be the focus.

Even if someone told me, Simon, the product is the only thing you should care about, because it wasn’t resonating with me at that moment, I made a lot of mistakes. So, I would like to share this lesson with other entrepreneurs. They should really focus on customers, or less say the product, then later expand. Actually, this is a lesson a lot of us in the Valley share, and a lot of books and articles are being written.

HANS TUNG:  But unless you do it once, you don’t know what is important and what is not, and what’s the weighting of each.

ZARA ZHANG:  I think a lot of founders, especially in China, see fund raising as a signal for success. Like, as long as we close a round and the valuation is high, we’re a successful company. But that actually creates a lot of pressure and like you said, can dilute your focus. So, there could be a downside to that as well.

SIMON ZHANG:  Actually, that’s a very different type of culture between American startups and here in China.  I think it’s started changing, slowly.

HANS TUNG:  In the U.S. every press, media expert will want their founders not to talk about valuation and money raising too much, because reporters are so jaded, they don’t want to just report on you based on a lot of money. They really want to know what kind of value are you generating? Or that it’s not just a me-too company. It’s a lesson that needs to be there not just in China but also in Latin America, Southeast Asia and India. In emerging markets it’s very easy for people just to pound on their chests when they’ve just raised a large round. It takes more maturity or experienced firms like you to share the lessons.

SIMON ZHANG:  I’m just a little bit bold to share that lesson.

ZARA ZHANG:  So what recommendations do you have for Chinese employees at Silicon Valley tech companies who are interested in coming back to China to maybe found startups?

SIMON ZHANG:  It’s two different types of world. It depends on what they really want. I would say here in China this is a historically important point. People can come back to become someone memorable in human history. This is the place to nurture the next generation’s greatest enterprises, globally. So, I would say someone in Silicon Valley, they’re young, they’re ambitious, they really want to build something creative, this is the market that can nurture the greatest entrepreneur in the next five or ten years. This opportunity, really, they should come back to grab it. I think some of them might have regret. This is a lifetime opportunity for young, smart, well-educated engineers or Silicon Valley Chinese folks who are thinking of coming back.

If, say, after they become a VP or some senior director, or whatever, it’s a golden chance. And also, kids, family, houses, cars, it’s harder and harder for them to come back. Right now, I think is the opportunity for them to play in this field. They have nothing to lose. I’m almost 43 or 45 years old. They are much younger than me. They have nothing to lose, but a lot to gain. Even the process would be very painful. I would recommend for them to come back.

That’s the story I told some of the employees at GrowingIO. I told them this is a lifetime event.  From my heart. I’m not cheating them, I’m not making up some story. This is the place for people to become better. And also, analyze the environment. Think about the question Hans just asked me. Do other companies exactly manage—think about it. Do you want to grow in America, or you want to find somewhere there’s a little less competition? You want to become the first mover? There are a lot of advantage for Chinese people who stay in Silicon Valley. They still can come back, I mean here, to China market. I would recommend that.

ZARA ZHANG:  I think a lot of people are trying to figure out the timing issue. How long should I stay in the U.S. before I come back, because if you stay too short, the premium of what you can bring back is limited. But if you stay too long, you get settled. And people are also worried about economic uncertainties facing China right now.

SIMON ZHANG:  Well, it’s a great question. Think about if Jack Ma never stayed in Silicon Valley and learned anything about capital. He’s one of the most successful entrepreneurs—

HANS TUNG:  In the world.  In history.

SIMON ZHANG:  Yes, globally. I would say that’s kind of a thought, from my personal point of view. I would say timing isn’t the most important. Every excuse will become clear. If one thing we can prove, then we can learn anything. Of course, not in harming people kind of things. We can learn everything. Having an environment, having the requirement to learn is much more efficient than to think about doing something. I would say this is a battlefield. Learning in the battlefield, can gain much faster experience. Better skills.

ZARA ZHANG:  Just being in that environment.

SIMON ZHANG:  Yes. I would say.

HANS TUNG:  I think the questions Zara raised are very legitimate, and we hear them from a lot of folks who listen to 996 or come to our—

SIMON ZHANG:  Nine-nine-six. That’s a great name. 

HANS TUNG:  I think that we also hear from a lot of people who made that concession back. First thing you do is not worry about that you are superior. You cannot think that you know more. You have to be more humble and learn to fit in here in China more.

So, if that’s the case, it is much harder for someone to acquire that domain expertise in the U.S. and thinking that’s worth something when you come back, because most of the time it doesn’t. Even though there you were an AI or machine learning specialist, if you want to come back and stay an AI or machine learning specialist, that’s fine. You can acquire expertise in the U.S. and come back when you have achieved it. But the chance of you becoming a business leader and doing your startup in China? It’s not going to be high, because your mentality is already going to be like I’m an expert, so pay me a premium for being an expert. You choose to come back here to learn to be a founder and business leader.

So sure, you were an expert in data analytics, but that alone was not going to be enough to keep you. You had to become a different person in the last four years in order to build the business you want today. What made you decide to do that, and what specific lessons did you have to learn in order to become a T-shaped leader instead of an expert in data analytics, one of the best in the world?

SIMON ZHANG:  I learned from peoples’ criticism. Because when I just came back exactly like Hans just described, I thought if I was one of the best in that field, then, the parts that I built would be one of the best in this field. Then the company that I would build would be the best, right?

HANS TUNG:  And the customers would be so lucky to be able to use your product.

SIMON ZHANG:  Exactly. And then lucky to work with me. Oh man, what a horrible person I was. So, I would say, you know, I learned from crisis, tough times. I think the whole team learned from that. For example, the T-shape, the number one problem is how to build a team. We used to be result-oriented. Hey, you need to deliver this, deliver that. Fundamentally we found this wasn’t working any more, because we needed to be a team who did things in a consistent way for our customers. Then we needed to be able to have the collaboration and organization aligned.

I think the hardest lesson I learned was we really needed to build a great team, a great organization. The CEO is not just telling people how to build a part, but also understanding the customer, understanding the people and then build an organization. I began to notice that it used to be just a lot of terms in my mind, interlinking part of me. However, like the stuff they build feeds off my knowledge, at the moment I just live within it. However, right now we need to build that. We made a lot of mistakes.

We found a lot of lessons. Actually, employees told me hey, Simon, you’re wrong in this, that and that. I thought I was not wrong, and she was wrong, or he was wrong. But I started trying to analyze when she told me I was wrong, and I couldn’t understand what she meant at the moment. Then I asked a little different type of people, and they told me hmm, I didn’t have that type of problem with her. Only you have that problem with her. I said okay, let me think about that. The problem was I wasn’t aware of the problem I had, and that created more problems. Then I had to turn to myself.

So, I think that after coming back to China I became a little more open. I wish I could be more open for people to give me feedback, more open-minded, change myself.  Upgrade. I think that’s the largest lesson I learned. I still have a lot to learn. Really, a lot. The more I understand what I should do, the more I need to look for feedback and criticism. I think the second part is in business, there is so much great knowledge generated in history because we have not recognized the deficiencies of ourselves. We made a lot of calls based on personal judgement. These aren’t facts.

We have to learn from the facts. We have to learn from doing. We have to learn from making mistakes. I need to be quick, and not just keep making the same mistakes for five years. I think that company would die for sure. We need to learn to fail fast and keep moving.

HANS TUNG:  One of my theories is assume that everybody is similarly smart. To get to the right answer you have to go through a similar number of mistakes and failures and trials in order to get there. It could be Chinese versus Indians, Chinese versus Americans. It doesn’t matter, the race. Everybody is similarly smart, and it takes some number of mistakes to get there.

It used to be that somebody goes through that process and a second team could copy and clone and take a shortcut and still get things right. So, you’d focus on the result, get there very quickly, didn’t have to go through the same number of mistakes. But as more and more these countries and teams are at the cutting edge of what they do, you still have to go back and figure out what mistakes you have to make in order to get the right answers.

Having said that, do you feel that, having worked in China and the U.S., both places, which market is faster at iterating and making those mistakes to get to the final answer sooner, quicker?

SIMON ZHANG: I think you know my answer. Because I’m in this market. I think Chinese really learn so fast.

HANS TUNG:  A lot of Americans seem to feel like the Chinese don’t plan, they just shoot first, aim later. The techniques don’t have the right process. They just break everything and roll the product out before it’s ready. So, you’re fast, it’s a lot of action, but you’re not very efficient.

SIMON ZHANG:  Think about it this way. I would have called this creativities. This is innovation, because I think right now the speed of innovation becomes faster and faster. We cannot just set up the process before we understand what the customer really needs. So then, we try fast. I would say that’s part of the innovation. Chinese way, right now, and of course it’s been boosted a little bit by the funding.

HANS TUNG:  And the size of the market, and so forth.

SIMON ZHANG:  And size of the market, yes. However, I think the competition is faster than we are creating the theories, creating the process, or engineering the whole industrialized structure. That’s not a fit for this in a fast-changing market. We have to try and go fast. Of course, there are some fundamental things, for example, your business model. Your CAC versus LTV. At least the fundamental that the founders should think about that stuff, otherwise they will step into the pitfalls, the world’s pitfalls.

HANS TUNG: Another criticism of Chinese teams from Silicon Valley is there’s no work/life balance. In Silicon Valley they say you want to be innovating for a long time, therefore you want to stay creative, stay fresh. Take time off, step back, think about things, smell the coffee and so forth. And a lot of those are very legitimate practices. In China, what do you see, and what do you practice? Do you worry about work/life balance here? When you see teams work 996, 9 a.m. to 9 p.m. six days a week, sometimes even seven days a week, how sustainable is that? Can you be both efficient and hard-driven at the same time, or do you have to choose in order to stay creative and innovative for a long period of time?

SIMON ZHANG:  This is a great question. When I was working in Silicon Valley, I was working very hard, compared with my colleagues or my peers. I think that was one reason I could get promoted a little bit faster than normal. After I moved back, I found every single company in China, almost, from Baidu, Alibaba and Tencent, everyone’s working so hard. For example, recently we heard of some company in Nianhui 年会 , or annual parties, some founders said hey, let’s change to 986 tomorrow, or something like that. Puts some newsfeed in there recently. My feeling is having a clear goal, keep delivering, is very important in any market.

If your competitors are doing much more work than your 955 company, I’d say this company would have lost. Nine to five, for five days—regular. In the China market you have to work harder than U.S. company to survive in this market.  Even Alibaba, the building is just a couple of blocks from my office. You can see at 11 or 10 p.m., at night, the whole building lights are still on. That’s peer pressure, I would say.

However, on the other side, I definitely think keep a certain level of space where people can have time for deep thinking, truly focus on work, but not just build on by hours. Because it’s not by how many hours we work, it’s still how many great parts and results we deliver. But there should be some balance. Hans, you asked me the question. The first time I moved back to China, we worked almost 007.

HANS TUNG: All the time, seven days a week.

SIMON ZHANG:  We went home around 3 a.m., came back around 9 to 10 in the morning. So, we said hey, we just have office and home, a dorm. The office is a home. So about for almost nine months, we felt we couldn’t even think. We were too tired. And we had to return to 997, but the seventh day is a half-day. Still you feel exhausted, and you have to balance. I wish every company would select that balancing point, but to a certain level.

HANS TUNG: So, what is your schedule now?

SIMON ZHANG:  I recommend some of the founders, they need to have time off. Because when they go somewhere else, company is shut down, their thoughts become clearer than before. And also, when occupied by day to day, it’s very hard to make the right decision. That’s the recommendation I’ve been given by my friends and my peers, sometimes my advisor and coach. So, I learned better than before. So, I would say there is a balance.

HANS TUNG: So, when you’re not on a break, what is the schedule?

SIMON ZHANG:  Still 996 is very normal. I think most of the times I go to the office a little bit on Sunday, when it’s quieter.

HANS TUNG:  Right. So, you can think.

SIMON ZHANG:  I can think a little bit. And I can learn a little bit. That’s not the right habit, maybe, but recently I started managing that a little better because of the story you shared with me. You know, the Japanese story? I think I need to learn a little bit harder from what other people speak. Because I’m always occupied by myself, by my old habit, which means I don’t change.

HANS TUNG:  I’m always fascinated by Japanese history how some of them could achieve Zen and be able to think, reflect, and still be able to act aggressively and quickly as needed. So, how can you do both well? To me, there was never a question you have to choose to be efficient and work 955, or you work 996, 997 and you’re not efficient. I don’t see that you have to choose. I think there’s a way to do both, and that’s a higher form of working, and whoever can do that will be the most effective.

ZARA ZHANG:  I wanted to shift the topic to growth. You wrote a book called 《首席增长官》Chief Growth Officer.  For many Chinese people, it was their first exposure to the concept of data driven growth. At that time, growth as a term was already frequently heard in the Valley, but still relatively novel in China. So, what do you think are the differences between Chinese style growth and Silicon Valley style growth?

SIMON ZHANG:  I think Chinese version of growth is more like the numbers, you know numbers of users, number of GMV or number of… I think Silicon Valley growth means you use science, you use data to grow efficiently, and then you manage your product life cycle smartly. First you focus on maybe your MVP or prototype, and then you become a part of market, at fifth stage you fund retention, at that stage you should not pour a lot of money to boost the number of growth. And after that you figure out a channel fit and then you accelerate your growth. Those are almost exactly what LinkedIn did in the past 15 years, right?  Stage by stage. However, in China, like the question Hans asked me, the market changes so drastically and so quickly, people do not have time to do this in so classic way. I would say Chinese market focuses on dominating the market by using whatever it takes, then become a monopoly, and then you set up the price, and then you set up the business model, you set up the CAC and whatever. Actually, it’s built a lot of great companies. At least some. But recently, I think it’s started changing.

HANS TUNG:  Because the market as a whole is not expanding that much anymore. So, you have to be a lot more efficient in order to survive.

SIMON ZHANG:  Be efficient to survive. And have the right business model, and then to grow naturally or normally. I would say there’s a changing underneath with the economy, everything, the market dynamic is changing. I would not say which one is right, which one is wrong. But I’m just saying right now, it’s time for many, many companies to learn how to run business efficiently. This is a fundamental and can build the long-lasting enterprises in the future. The future is not just two years old, your IPO, done.  No, actually, to build a great company, should have a lot of patience and dedication, it’s a long-term journey. Then I would say the relative theory, part of the tooling we brought to the market, I hope could help a lot of companies and entrepreneurs become long-lasting success.

ZARA ZHANG:  It sounds like that bodes well for enterprise SaaS as a sector in China.

SIMON ZHANG:  Yes. And both the 2C and the 2B companies. But still in the market, there are some companies that are boosted by funding, right? As the business model. I would say being creative is always right. Being fast. It doesn’t matter if in the mature market or in a fast-growing market, being fast is the key. It doesn’t matter where we are, either U.S. or here. Our being fast doesn’t mean being short, short life cycle or short lifetime. Being fast means everything we need to be doing is fast, dominant.

HANS TUNG:  And this is not a popular thinking in Silicon Valley. You don’t hear groups saying we’ve got to move fast, we’ve got to move fast. Everybody favors being more methodical, think it through, plan. But if somehow you could do both, and you learn how to think on your feet, it actually becomes a great advantage, because you know other people are going to be slow. So, if you can move fast and think at the same time, you see everyone else stop moving. It’s actually good.

SIMON ZHANG:  I learn, I learn from Hans now.

ZARA ZHANG:  I think Chinese founders often have a warlike mentality. Like no matter just grab the land share first, and then figure out what to do later.

HANS TUNG:  I think over time, you have to be able to do both. So, you learn how to plan, but you learn how to plan while you’re on the go. That’s how you can be staying one step ahead of your peers or competition. So, it’s fascinating. And you nailed it. How you learn is very important. I think one of the things that I picked up as a trait of a lot of great founders, they figure out how to learn faster, quicker than their competitor, and that’s how they stay ahead.

SIMON ZHANG:  We’re still on the journey of learning how to learn. But it’s fascinating, it’s great. You changed a lot your mindsets

ZARA ZHANG:  Moving on to the quick five questions. Who is the entrepreneur you admire the most, and why?

SIMON ZHANG: I learned a lot from different type of entrepreneurs. I would say that Ed Catmull, who built Pixar, he has so much insight as how to build a creative culture, how to learn fast, how to become eco-right within the company. I admire him a lot. I read a book, actually the book was recommended by the CEO from Pablo.  I asked him, “Hey, what can I learn? Any books you can recommend to me?” He said, “Simon, you can read that Creativity, Inc.  A couple of years ago, I read the book. I learned a lot. It’s fascinating. I met him about two weeks ago here in China. He presented at Jike Gongyuan 极客公园 or Geek Park. He shared a little bit and I admire him quite a lot. Had a dream of building something really unbelievable and then delivered it. Figured out that building a dream is not the key. Deliver the key of building dreams, and it’s just fascinating the mindsight, the methodology, also another culture. Everything. I like him quite a lot.

ZARA ZHANG:  What’s something you read recently that you recommend?

SIMON ZHANG:  I would recommend a lot of very old books. I have one book I like to recommend to anyone to read. I think it’s called The Discipline of Market Leaders. It was a funny story. Let me share a little bit. I bought the book last year in summer from Amazon, and it shipped to my friend who lives in Silicon Valley. I bought some books and he always brought them back. And then he brought it back to me at the end of the year, almost November. I read it, think oh, this is great. A lot of models, talking about product, service, and efficiency. All different type of business models.  The funny part is that in the book, I saw a note from the seller. The seller said “Hey, the books I’m selling are always five to 20 years old. Congratulations. You bought the oldest book ever on my shelf. This book was 24 years old.” It was new, not read. The book talked about how to become a market leader. The focus, you know. You either want to focus on product, focus on service, or focus on efficiency. Those business models have been analyzed and become a theory 25 or almost 30 years ago. To me it was brand new information. I learned a lot. A lot of questions I had three years ago when I was building the company, those answers were available.

HANS TUNG:  That is a very good book.

SIMON ZHANG:  It was a new old book, right?

HANS TUNG:  But it talks about you cannot optimize every single factor. You had to choose one, and you had to figure out the one that you choose, whether it fits your industry and your personality or not.

SIMON ZHANG:  Narrow the market, whatever.  However, that’s resonant with the growth theories, quite well, you know, focus. Typically, entrepreneurs or founders that try to grab a large market, do everything simultaneously for whatever reason—but I just feel the book was very good.  I really recommend it.

ZARA ZHANG:  What do you do for fun?

HANS TUNG:  Do you have time for fun?

SIMON ZHANG:  Go to work. That’s the fun for me. Seriously. I think that’s the fun part. It motivates me to go to work every day. Even if it was tougher yesterday than today. Anyway, besides work, I like to play video games. I used to be a very good video game player. Recently, I’ll play video games with my son. He’s better than me. Sometimes I learn from him. He learns more quickly than me.

ZARA ZHANG:  That’s all we have for today.

HANS TUNG: Thank you very much.

SIMON ZHANG:  Thank you for the invitation. It’s been a pleasure.

If you have any feedback on this podcast or would like to recommend a guest, please email us at 996@GGVC.com.

Episode 30: Doris Ke on Marketing Across the US and China

GGV Capital’s Hans Tung and Zara Zhang interview Doris Ke, a marketer and writer who has had an interesting career across the US and China. Doris grew up in China and went to the US for college, where she attended Bard College in New York. She started her career at Unilever where she worked on brand development, and then joined Michael Kors in New York where she was the social communications manager for APAC. In 2015, she left Michael Kors to become the head of marketing operations at Alipay US, based in Silicon Valley. In 2017, she returned to China to become the CMO of the Chinese startup YCloset (衣二三), which is often referred to as “the Chinese version of Rent the Runway”. She recently left YCloset to start her own marketing startup.

Throughout all of this, she has also been running a WeChat official account with around 100K followers called “doriskeke”, where she blogs about the cultural differences between US and China.

During this lively episode, Doris discussed the cultural differences between working at Chinese vs. American companies, lessons from her viral yet controversial marketing campaign at YCloset, what it is like to live in Beijing as a Shanghainese, and how she used the “growth mindset” to find her boyfriend (now husband).


HANS TUNG: Hi there. Welcome to the 996 Podcast brought to you by GGV Capital. On this show we interview movers and shakers of China’s tech industry as well as tech leaders who have a US-China cross-border perspective. My name is Hans Tung. I’m a Managing Partner at GGV Capital and I’ve been working at startups and investing in them in both the US and China for the past 20 years.

ZARA ZHANG: My name is Zara Zhang. I’m an investment analyst at GGV Capital and a former journalist. Why is this show called 996? 996 is the work schedule that many Chinese founders have organically adopted. That is, 9 am to 9 pm, 6 days a week.

HANS TUNG: To us, 996 captures the intensity, drive and speed of Chinese internet companies, many of which are moving faster than even their American counterparts.

ZARA ZHANG: On the show today we have Doris Ke, a marketer and writer who has had an extremely interesting career across the US and China. Doris grew up in China and went to the US for college where she attended Bard College in New York. She started her career at Unilever where she worked on brand development and then joined Michael Kors in New York where she was the Social Communications Manager for APAC. In 2015 she left Michael Kors to become the Head of Marketing Operations for Alipay US based in Silicon Valley. In 2017 she returned to China to become the CMO of the Chinese startup YCloset or Yiersan 衣二三 which is often referred to as the Chinese version of Rent the Runway. She recently left YCloset to start her own marketing startup.

HANS TUNG: Throughout all of this, she has also been running a WeChat official account with around 100,000 followers called Doriskeke where she blogs about the cultural differences between the US and China. She’s also known as Dao Jie 刀姐 in China because Chinese people pronounce her name as Doris and by the way Dao Jie 刀姐literally means knife sister. I always found this name appropriate because both her personality and her writing are extremely sharp, on point and insightful. Welcome to the show Doris.

DORIS KE: Hi everyone.

ZARA ZHANG: So, you chose a very different career path from the vast majority of Liuxuesheng 留学生 or Chinese students who study abroad. Most of my friends who went to college in the US found jobs in finance, consulting or engineering after graduation, but you went into FMCG and marketing; why?
DORIS KE: Yeah, I think to be honest, one of the reasons why is actually I couldn’t get one. I went to a liberal arts college. It’s Bard College, it’s not like a big university like Harvard or Yale, so I wasn’t really –

HANS TUNG: But it’s still a good school.

DORIS KE: Yeah, it’s a good school but it’s famous for art and all of my friends, they’re like really into philosophy and art. They want to be artist when they graduate so we are not like one of those target schools, so that’s the actual real reason. Then the second reason is really when I was doing an internship when I was in college, I didn’t even bother to go to one of those banking jobs because I just felt like that was really boring to me. I actually went to one of the consulting firms, Roland Berger, during my junior year and all I was doing was doing cold call, paperwork and research on the glass industry. The next year I was doing a Coca-Cola internship and I compared the difference and it was really big.

One is you’re just doing numbers. Crunching numbers and trying to analyze the industry while on the other hand, while I was at Coca-Cola, I did consumer research and I changed the products, and the marketing campaigns. I really see the impact I’m making on people. So, I felt like I really wanted to do some job that’s making a real impact versus just crunching numbers. That’s just my personal opinion. That’s why I chose to do marketing and I went to Unilever in the end.

ZARA ZHANG: When you went to Unilever you actually turned down an offer from P&G?

DORIS KE: Right.

ZARA ZHANG: How did you approach that decision-making process?

DORIS KE: When I decided to go into the marketing industry, I did research on what are the best companies to go to. Procter & Gamble and Unilever were definitely the two best companies. They’re like the marketing schools and so I applied for Procter & Gamble China and then Unilever US because Procter & Gamble US couldn’t sponsor a H-1B for me but Unilever at that time, had this innovative program called Shanghai Management Trainee Program in which they put Chinese people, graduates, two years in the US and then the third year they sent you to China to become a manager. Versus Procter & Gamble, they just sent you back directly back to Guangzhou. I was like, “Guangzhou, I have never been. I’ve heard Dim Sum is good, but probably not offend me. I’m Chinese to be honest.” I’m kind of like, “Guangzhou, really?” So, I debated really hard because Procter & Gamble is my dream company. Unilever in the US, that’s really attractive.

Then I talked to one of the Unilever directors and he gave me this point of view which was really helpful to me even to now. He told me that Procter & Gamble hires 30 marketers every year and so to now the already have 500 and Unilever only hired 10 Chinese in the US to be marketers in the US. Do you want to be one out of 500 or one out of 10? Your uniqueness is going to define how valuable you are in the future. That’s why I was like, “Oh yeah, that sounds right.” I turned down Procter & Gamble, although I was literally heartbroken to turn it down, but I went to Unilever in the end.

HANS TUNG: One of the reasons we have you on the show is that you had experience doing marketing which is very localized. It’s very localized domain knowledge in both the US and China.


HANS TUNG: That’s still rare enough. The second reason is that you made adjustment of coming back to China and localizing the Chinese community after spending quite a bit of time outside of China. On those two fronts, how easy is it? How much leverage do you get from knowing how to do marketing in the US to China? Then as you learn how to do marketing in China, how do you localize and reintegrate yourself back into the Chinese community?

DORIS KE: That’s a great question. Lots of people actually ask me that. Actually, you don’t get a lot of leverage from working in the US. Lots of people, after working in the US for a while, they return to China and they’re like, “Oh my God, it’s completely differently. I should have come back to China earlier.

HANS TUNG: Are you saying you should have taken the P&G job?

DORIS KE: I should have taken that, to be honest. I regret it so much. Sorry, Unilever. But to be honest, I went to Unilever then I went to Michael Kors and then I went to Alibaba. That’s when I got to adjust to the Chinese culture. That’s when I came back to Beijing two years ago to join YCloset, I wasn’t really that culture shocked because in Alibaba I already had the culture shock.

HANS TUNG: So, Ali is better than Unilever.

DORIS KE: Right. So, Unilever taught me a lot of systematics, structured thinking.

HANS TUNG: Multinational way of doing business.

DORIS KE: Right, business sense. How you calculate the ROI, cost of goods sold, margin and profit and all of that but in China the media is different, consumers are different and then the budget is different. In the US, I mean, when I was at Michael Kors, I had millions of dollars in the budget to make videos. When it comes to YCloset they’re like, “Sorry, we don’t have that.”

HANS TUNG: You’ve got to be innovative.

DORIS KE: What is budget? There is no budget, sorry, just use your mind, be creative. So, I think that’s the huge difference. I really appreciate my experience in the US because I got to be really structural and plan ahead, be strategic versus in China you just need to be flexible and you need to navigate around resources to get things done and that’s very different.


ZARA ZHANG: In 2015, you made the move from New York to the Bay Area to become the Head of Marketing Operations for Alipay US. I recently read the book Ali Tiejun 阿里铁军 which means “Ali Iron Army.” It’s a book about the B2B sales team at Alibaba which is very famous for its training and methods and just army like culture. A big takeaway from the book is that this culture will probably be very difficult for internationally minded Millennials to adjust to.

DORIS KE: It is.

ZARA ZHANG: Because, the company puts a lot of emphasis on culture and has a lot of practices that are almost military in nature and doesn’t really promote self-expression. So, what was your impression on the Ali culture after you joined? What were the most unexpected things as someone who had just moved from the glitzy world of New York marketing?

DORIS KE: Yeah, I think that was really memorable. I will never forget about that experience. I think Alibaba is great. It’s great because the execution of Alibaba is all doing it so fast and smooth. It’s all because of that culture that’s cultivated but it’s really hard for me who has had the US education, who has been trying really hard to try to express myself when I went to the US and then to Alibaba it’s this other –

HANS TUNG: There’s no need to, just follow and execute.

DORIS KE: It’s reverting back to myself again. I have a couple of really, I would say shocking memories, like really interesting memories when I went to Alibaba. The first thing is when I was in New York, you know the lifestyle of New York you are in high heels, you’re head-to-toe dressed up and then you’re meeting celebrities. That was my New York life. Then went I went to Alibaba the first thing is I went to Silicon Valley. Silicon Valley and New York, that’s already a big difference.

HANS TUNG: Yes, even for Americans in America, yes.

DORIS KE: Right. So, I was like, “Oh my God countryside.”

HANS TUNG: Countryside.

DORIS KE: Bubble tea was like my night life in California.

HANS TUNG: Nothing happens after 10:00.

DORIS KE: Right. Then half of my time was in Hangzhou. That was another culture shock. Basically, you have mountains and tea.


DORIS KE: Last second, I was in high heels in New York and next second I was doing “Double 12” campaign for Alipay. I told Zara before, we were putting ribbons on my forehead and then drinking alcohol and then smashing the cups on the ground and then lots of drugs. I literally remember, we need to write down the KPIs on a wall, on a global map because we were doing global Alipay. Then I need to sign my blood on it. I was like that was really interesting.

HANS TUNG: It seems that way.

DORIS KE: Yes. Then we were wearing the slogan t-shirt that says, “Gan 干.” Then I was trying to explain to my US colleagues –

HANS TUNG: Just like Nike’s “Just Do It”, that’s all.

DORIS KE: I was like, right, just do it. That also means “fuck”. Why are we wearing that? So, that was a really fun experience, yeah. Some other experiences that –

HANS TUNG: What prompted you to leave the good marketing in New York to join Ali in the countryside of Silicon Valley?

DORIS KE: Because I think Alibaba is the future and then Silicon Valley is also the future. When I was at Michael Kors, I think most of the time we were doing traditional marketing whereas you get a contract with a celebrity, you make a fancy video, we put lots of budget behind it and then you have lots of stores opening. Whereas I was reading Zero to One, Growth Hacker and things like that and I was seeing California there are so many companies they just grow from zero to a million without any budget all because of growth hacking. I was like, “Wow, that’s so different.” I was also seeing Alibaba, in China there are lots of crazy things happening like Taobao or Alipay and so I feel like I shouldn’t just surround myself into this fashion world where everything looks fancy, but I don’t really see the business point behind it, and I don’t see it being sustainable and so I want to learn new things. That’s why I went to Alibaba in California. Half the time I can learn growth hacking from the US side and half time I can learn the military style from Chinese style.

HANS TUNG: [crosstalk] discoveries?

DORIS KE: That’s a perfect fit.

ZARA ZHANG: What was your biggest takeaway from your time at Ali?

DORIS KE: There are so many takeaways. First of all, I think the culture which you just mentioned in Alibaba is really interesting. Everyone in Alibaba is always super pumped. They never slack off. That’s something I’ve never seen before. I was always trying to figure out how they did that, like what’s the HR system that you can motivate people like this? I literally remember one of my co-workers she just gave birth a second ago and the next second she’s on DingTalk. I was like, what? Wow, what kind of HR system supports that? I think that’s really amazing.

The second part is really the ops. There’s a saying in China. I don’t know if it still works right now, it’s by Baidu tech.

ZARA ZHANG: Tencent’s product.

HANS TUNG: Tencent’s product and Ali’s operations.

DORIS KE: Tencent’s product and Ali’s operations. So, I was on the operation side and really when I was on marketing it is more about spending money and how to create the brand awareness and then impressions. But in ops, it’s really about ROI, how you make the most impact out of this budget.


DORIS KE: So, that’s what I learned most from Alibaba.

HANS TUNG: Very good. Yeah, someone who has figured out a way to combine east and west in Silicon Valley, what prompted you to come back to China and join a startup.

DORIS KE: Yeah. I always wanted to go back since day one, right. What made me stay in the US is because I felt like US in terms of brand management and marketing is way ahead of China back then, so I wanted to learn the logistic style of marketing. Then after a couple of years I felt like I already absorbed most parts of the US marketing culture and lessons. I really want to do something that’s, you know, what I built. In that sense, it’s like Michael Kors the brand is already there. In Alibaba it’s already there. What I did was that I basically took that brand and make it a little bit better maybe. But YCloset, it’s a fresh new idea and brand, nobody knows about it and I kind of want to prove whether I really know marketing or not by maybe I should do something from zero to one. I kind of want to show my muscle and try to challenge myself again, but this time not in a big platform like Unilever and Michael Kors or Alibaba but in a platform, nobody knows about without any budget and see what I can achieve.

HANS TUNG: Before you joined YCloset you hadn’t been doing marketing in China before? You had been working at Ali but doing US and some China, but mostly US and so do you think that because of your experience with Michael Kors and YCloset is in the fashion business and because of your training at Alibaba it helped you get a job that you know for sure that you can do marketing in China?

DORIS KE: That’s actually because my WeChat account. I’m very real. I was like, “I’m not even sure I can do China marketing, but she trusts I can do it.” Actually, I really admire the founder of YCloset, Stella. She read my blog. I mean, my WeChat account. I was writing a lot about marketing and cultural differences between China and the US, how I did marketing at Alibaba and Michael Kors and all of that and she really has this trust in me that she sees my potential. She’s like, “Why don’t you be my CMO and I trust you.” She didn’t even interview me that much, she just said, “Come join me.” I felt like she gave me the trust, maybe I can do something big together and so that’s why I joined.

HANS TUNG: If you look back, what made your WeChat unique? What were the things that you wrote that your followers mostly responded to the most?

DORIS KE: I think two things. One is a real experience how a Chinese working in the US looks like. The first post that made me popular is when I wrote about my job at Michael Kors and being a Social Communications Manager in New York City fashion world and being Chinese. That was like, how I experienced all the culture shock and how I struggled and got past that. That was really popular. The second thing is really comparing difference between China and the US. I wrote about the difference between bloggers between China and the US and how they’re different and how fitness differs from China and the US and all that. Right now, I’m writing how beauty bloggers differ from China and the US.

I think when I was writing my articles all I was thinking was what is my niche point? Lots of people know beauty bloggers in the US, lots of people know beauty bloggers in China but they don’t know the difference between them and how they impact different businesses in different worlds. I think being someone who is the bridge of US and China, what I should bring to the table is really see the difference and then inspire different worlds how other people are doing the same business. That’s really popular on my platform and we attract the Chinese world.

ZARA ZHANG: I think writing is all about finding what’s the unique perspective that you have. You’re not the only Chinese person doing marketing in New York but you’re the only one who bothered to write about it so that makes a difference. A lot of people writing, it gets great response just because other people resonate with what you write. Most people just don’t bother to write so if you make the effort and be disciplined and just keep writing that is actually really rewarding.

DORIS KE: Yes, yes.


DORIS KE: Then when I was doing Michael Kors that was actually the rise of the year of WeChat official platform in 2014.


DORIS KE: I really saw the benefit of writing on WeChat and how it got to Michael Kors. I was thinking if I write a blog under my name and about my content, I could also benefit from that. That’s why it really got me motivated to write.

HANS TUNG: I want to point out that when Zara encouraged us to do 996 Podcast, I wasn’t sure how popular it would be. I think like you said, if you’re willing to write something or produce something and it resonates with other people a lot of people didn’t bother to do it at all. You also took advantage of the fact that a new platform just emerged and you’re among the first that did it on the platform that suddenly became very popular. Also, you are where you are because of the different jobs that you make a decision to take that gave you exposure both to US and China. A lot of people don’t do that. They tend to want to advance in their career and get better doing something that they started and do not want to change from that track because that’s how you get promoted very fast. But in the long run, by having different jobs in different locations it may require restarting and readjustment and in the long run that gives you more perspective to be a much better bridge.

DORIS KE: Right.

HANS TUNG: A lot of people think it’s easy to be a chronical bridge. I don’t think so at all. You have to have enough knowledge of how each system works in order to create value. Being a bridge if you’re just up charging information is less interesting. Creating value is much harder.

DORIS KE: Right, I totally agree.

HANS TUNG: At YCloset what were the things that surprised you the most and what were the things that were most satisfying about the impact you were able to make because of your cross-border experience?

DORIS KE: What I was really surprised by was I really didn’t know – that was my first job in China doing marketing and also the first time in a startup. All before that it was really big companies. There were many shocks, and so I’m not sure if it’s because YCloset, or because it was China, or because it was a startup.

HANS TUNG: Too many variables.

DORIS KE: There were too many variables at the same time. I should have done one variable at a time. It was too many variables. I was shocked that lots of systems are not built, so we don’t even have a solid data tracking system, so we see growth, but we don’t know where it comes from. Then there’s not a planning system. There are lots of things like that. But really what I found is it’s really common in China among startups and so what I really wanted to build was bringing the mature systems from the US but at the same time being flexible in China so not to be too America style. You still need to be China style. That was my shock.

Then, I was really proud because as someone who just came from America, I was really localized. I managed to build my own team and then also I grew the user base 10 times from a paid user standpoint. Then I actually built lots of successful campaigns that drove the growth and also brought in the idea of growth hacking from the US but combined with the Chinese style which is also called Liebian 裂变 which is cost efficient. I don’t know if Americans understand that.

ZARA ZHANG: Like, viral growth?

DORIS KE: It’s like viral growth and referral program and all of that with the WeChat system. I was really being able to combine the western and the eastern style. That was really something that I was proud of doing.

HANS TUNG: Got it.

ZARA ZHANG: I think growth in China is usually heavier than the US. In the US people kind of build a great product and wait for people to come. Whereas in China, you actually have some really heavy Yunying 运营 or operations behind it.

DORIS KE: You usually pay people to use your product, right.

HANS TUNG: In the US there’s a lot of growth hacking but there’s not a lot of operation.

DORIS KE: Right.

ZARA ZHANG: It’s more data driven in the US.

HANS TUNG: More data driven, that’s right.

ZARA ZHANG: Data, and tech, and product driven whereas in China it’s like human driven and money, I guess. So, did you do a lot of that and what do you think were the takeaways on the best practices?

DORIS KE: From an operations standpoint?


DORIS KE: From an operations standpoint I was doing lots of WeChat group management ops. That’s like community based and that’s something really Chinese style that you basically need to make a poster and then put it in the groups so that people can make it viral and then inviting more people to join the groups. Something like that. That doesn’t exist in the US. But we also did like lots of red packets in YCloset where you refer a friend and both of them can get RMB 50 or something like that. Or, we just invented lots of incentive tools like that to motivate people to share, or to use more. I don’t think that’s really common in the US. In the US you just have the Rent the Runway, you have lots of dress on the platform and then people are just going to rent. But in China we have something called Jiayiquan 加衣券it’s basically like a dress coupon where if you have it you can rent one more dress in your bag. That’s something we created for Chinese users.

ZARA ZHANG: You had no budget, so how do you deal with that challenge? How do you be scrappy and creative and do things without spending a lot of money?

DORIS KE: That’s a good question. When I say I don’t have a budget, I actually mean I have a limited budget, but it is not like I don’t have any. It’s basically how do you get the best ROI out of it. The first thing is really how you get free traffic and then also make the most out of your traffic. So, for example I would talk to lots of platforms like, for example, Alipay. Then I know they have lots of traffic and what they need. Then I just talk to them about a collaboration between YCloset and Alipay. That’s how we got lots of traffic to be honest.

The second thing is when you get the traffic you need to increase the conversion rates. We did a lot of A/B testing. That’s also common in the US to see how you really increase conversion rate not to waste the traffic. Then the third thing is that when people become a user, we try hard to make them sure to refer so you get the viral growth out of it. Basically, the idea is the same but just in the Chinese system you need to use different tools, incentives and platforms to make that happen. Also, we made a very controversial video.

HANS TUNG: That’s our next question. If you have a limited budget you have to do something out of the ordinary and so what was it, how did it work out and what was your lesson takeaway?

DORIS KE: The reason why I did that is I did all the growth hacking stuff like I told you, but the conversion rate was still very limited because of a couple of reasons. First of all, people don’t want to wear the clothes that other people have already worn. They don’t want to share. The second thing is nobody knows about YCloset, like what is it? Even though I can see I can wear so many cloths in a month, but I don’t trust this platform and so low brand awareness and trust. The third thing is that they just couldn’t figure out how to rent clothes on YCloset and so lots of education cost there and that leads to high customer acquisition cost.

Basically, I figured out the root of the problem is a marketing issue. You need to make people trust you, be aware of you and then know what the hell you are. That’s why I really insisted on making a video or a marketing campaign to make people be aware of what YCloset is and what benefits it can actually bring to you. That’s going to lower the CAC later on.

HANS TUNG: Right. That seems innocent enough.

DORIS KE: Then I went off to convince the CEO that we need to make a video. But usually, when you say that, “I need money to make videos,” CEOs are going to be very insecure. Like, “How much do you need? What impact am I going to get out of this video?” I couldn’t ask for a lot, but I need to make this video viral and also at the same time have it really clearly communicate what the value prop of YCloset is. So, I thought about doing something that’s really controversial to trigger the buzz and talk online. No matter online or offline I just want to make people talk about this concept, so it needs to be some insight that’s really sharp.

I did lots of surveys on YCloset and users and what occasions they were using. I see the result is that they all use YCloset for work and the cause is that at work they feel really needed to dress properly.

ZARA ZHANG: Differently every day?

DORIS KE: Right. Differently every day, otherwise especially in cities like Shanghai people are going to laugh at you like, “Oh my God, you didn’t change clothes again?” That’s why they need lots of dress. I took lots of observations at work and I see that this is the deep motivation and that’s why I made a video about women at work and how they dress properly can dramatically lead to career advancement.

ZARA ZHANG: Lead to career advancement.

DORIS KE: Even eventually at force. I made it really dramatic and also that’s really similar to one of the TV shows that’s popular in China which is called Huanlesong 欢乐颂.

ZARA ZHANG: Ode to Joy.

DORIS KE: Ode to Joy, right. So, that video eventually became so popular and viral in China. There are two sides of people talking about it. One side is, “Oh my God, this video is so funny. It’s really interesting I never knew such a product existed.” The other side is like, “Oh my God, you’re talking about appearance leads to career advancement? Did you even go to the US?” I was like, “Okay, that’s not what I meant.”


DORIS KE: I actually meant in China there’s lots of occasions people don’t dress popularly. Like when you meet clients, you’re in gym clothes but someone else who is properly dressed can actually get lots of notice from clients. I made it really dramatic and it led to lots of controversy. But no matter which side they’re on, they all download the YCloset and become a user and so that’s a good number. But yeah, I got lots of attacks doing that controversial video.

HANS TUNG: How does it feel when you yourself become popular and controversial in a topic of things that you know that’s not who you are, but people are talking about you in that context? How do you deal with that?

DORIS KE: I had a huge struggle inside. I was like, “Growth and your belief, that’s like oh my God which side do I try? The KPI and my value side?” I’m like, “One side I want to make my job successful without a budget I can make success happen.” Then the other side is like, “That’s a little bit controversial, that’s not what I believe in.” When I wanted to do marketing, I wanted to build a brand that’s positive and make people feel better and now I’m making a video that is making people feel worse. That is the first thing that was like a super shock to myself.


DORIS KE: Yeah. Even to now I’m still thinking about it.

HANS TUNG: Did you ever write a blog post on your account? On your WeChat account?

DORIS KE: Yeah, I wrote one back then to defend or to really tell why I’m making this video and what message I wanted to deliver. But I didn’t write about the struggle or the dilemma after that.

ZARA ZHANG: Would you have done the same thing if you had the chance to do it again?

DORIS KE: I would do that video but then I’m going to create a second video after that.


DORIS KE: That video is going to create all the controversy and buzzy and mystery. Then the second one is like revealing why she actually got the career advancement. It’s like in addition to all the appearances, all the properly dressed thing, she also worked very hard. That’s going to become a series of video and then we can actually continue the IP.


DORIS KE: That’s something I really regret I didn’t do.

HANS TUNG: Right, but that’s a very good lesson?

DORIS KE: Right.

HANS TUNG: A very, very good tip for what could have been done.

ZARA ZHANG: So, for the company itself it’s referred to as the Chinese version of Rent the Runway, why did you think that this model could work in China? The shared closet concept was very new and Taobao is so powerful and works so well and stuff and is so cheap. What was your opinion on this model?

DORIS KE: That’s actually from my personal experience on Taobao I could buy lots of stuff but not really so many dresses that are fit for me. In the US have you have lots of good choices, you can go to Zara, or you could go to Michael Kors or there’s lots of other boutique stores that are okay. But in China there are low cost level there are luxury level but in between there are not many options. If you go to Beijing, where are you going to go to shop? I don’t even know where to go. I think there are still a lot of opportunities in terms of fashion and apparel out there.

Then I told you that at work lots of people have troubles wearing different clothes every day. Your closet is limited. Your space is limited. How are you going to buy so many clothes? I think the problem, the pain point is there it’s just how are you going to solve it.

ZARA ZHANG: Alibaba also made a strategic investment into that company?

DORIS KE: Right.

HANS TUNG: Switching gears a little bit, I’ve lived and worked in nine different cities and I want to say New York, Silicon Valley and Beijing are amongst my favorites. There are more but those three are definitely standouts. For you, what are your observations on these three cities and how are they different when it comes to people, their working styles and values? Especially within the tech industry do you see any similarity or are there mostly differences?

DORIS KE: New York is definitely my favorite city. I think New York is fun because people there they have this energy around them. They can go to work and be very hardworking, but they still have a nightlife. They go to clubs or to bars, and they go to a show or galleries during the weekends. But from a romantic relationship standpoint, I don’t think New York is the best place.

HANS TUNG: Why not?

DORIS KE: I think lots of women would admit to that.

HANS TUNG: Too much competition?

DORIS KE: No, there are too many douchebags in New York. Too many bankers.

HANS TUNG: But here it’s hedge fund guys, traders.

DORIS KE: Right. Not doing solid things just doing – I don’t like that. Whereas, Silicon Valley there are lots of tech guys who are smart.

HANS TUNG: They are boring.

DORIS KE: They’re boring? That’s true.

ZARA ZHANG: They’re trustworthy.

HANS TUNG: They’re very reliable.

DORIS KE: Very, very reliable. That’s why I found a husband in Silicon Valley. He was trustworthy.

HANS TUNG: I hope he’s not hearing this.

DORIS KE: They don’t even know how to spend money. They just work their hearts out and be smart. That’s good. I like Silicon Valley. But it’s actually different from my imagination. I thought everyone there is like startup style, Elon Musk.

HANS TUNG: Like Elon Musk or Jeff Bezos or Mark Zuckerberg.

DORIS KE: Yeah. But I don’t know if I came out in the wrong groups or what. They just talk about buying apartments, investing in stock.

ZARA ZHANG: Green cards.

DORIS KE: Right. Having two kids at home and which apartment they’re going to buy in Palo Alto, what’s the house rise. I just don’t think it’s really cool. So, I was disappointed. I was disappointed, I learned a lot and then I came back to Beijing. Beijing is really fund. Beijing is like a combination of New York and Silicon Valley.

HANS TUNG: You’re from Shanghai, so. And you live around in Beijing.

DORIS KE: You know, all my friends are not hanging out with me anymore because they’re like, “a Shanghainese in Beijing? What’s wrong with you?” It’s like someone grew up in Paris and ends up in Silicon Valley, it’s just very weird. Because I moved from Silicon Valley to Beijing, I feel like Beijing is okay.

HANS TUNG: Beijing is an improvement.

HANS TUNG: It’s very relative.

DORIS KE: Every time my parents visit me, they’re like, “Oh my God, my poor baby.”

HANS TUNG: You’re not eating well. You’re not living well.

DORIS KE: “It’s all dirty. Oh my God. Oh my God, you can’t stay here anymore.” So, yeah, that’s really weird. Shanghai is like all the restaurants are like celebrity style and blogger style. Beijing is just Luchuan 撸串, you know. How do you say it?

ZARA ZHANG: Skewers.

HANS TUNG: Skewers from the streets?

DORIS KE: Luckily, I’m a workaholic so I don’t really – I’m not into those lifestyle things so I like Beijing more.

HANS TUNG: Now that you are not at YCloset anymore, you’re doing your own startup, did you ever think about doing your own startup in Shanghai instead of Beijing?

DORIS KE: My own shop?

HANS TUNG: Your own startup?

DORIS KE: My own startup? I still chose to stay in Beijing because I think the startup, the dynamics and environment is so much better here. People are motivated. We talk a lot about growth and then how to make growth happen. But in Shanghai they just ask me, “How many houses did you buy?” “Oh, two, that’s not enough.” “Did you find a husband?” “Where is he from?” “He’s from Wuhan not Shanghai? Oh my God, what’s wrong with you.” I’m not going to go back to Shanghai.

HANS TUNG: A lot of people in the western world thing that Shanghai is more the international city and is more likely to have startup, is more free but a lot of people out there don’t know that Beijing has the most number of startups and most number of tech IPOs in China. From your perspective is you would choose to have your own startup in Beijing is actually quite interesting.

DORIS KE: Yeah. I just feel like if I go back to Shanghai, I will probably get off my work ethic too early.

HANS TUNG: And go home afterwards or go out for dinner and party.

DORIS KE: Right.

ZARA ZHANG: In terms of marketing, you’ve gone through a whole gamut. First you marketed an American product to Chinese audience at Michael Kors. Then you marketed a Chinese product to an American audience at Alipay. Then you market a Chinese product to a Chinese audience at YCloset. Out of these which one did you find the most challenging and why?

DORIS KE: I think it’s definitely YCloset. I think the easiest one is Michael Kors because it is such a big brand and it is fashion. Then marketing an American brand to Chinese is a bit easier because in the past they’re not many fashion brands available in China. Then Ali US is such a big platform so although lots of US companies don’t know about it, I can just show them videos, and press releases and they’re going to be like, “Wow.”

HANS TUNG: They’ll get it afterwards.

DORIS KE: Like, the Amazon of the east side. But YCloset, nobody knows about it and then people don’t get the idea. It’s like a new brand, a new product, a new concept and a new platform and so I think that’s the most challenging part. Also, being the first job I got in China definitely is the most challenging one.

ZARA ZHANG: Maybe you could talk about your current startup, what does it do and what is your vision?

DORIS KE: Yeah. When I look at my past, I felt like all my interests or the products I was interested in are all for females. Consumer products, fashion products, or YCloset, that’s still apparel but in a tech company environment. So, I always see this rise of women in China, being more independent and being just different. Then their needs are going to change vastly these years, especially after the viral or controversial campaign at YCloset which I made, is that I realized women are different. They’re thinking about different things. That’s why I really want to focus on her economy and do research on it and how in the western world how they’re approaching her economy and how in China people are doing that and what are the new products or what are the new business that we can get from this change from how women think differently.

So, I’m doing a combination of marketing and media company. On the media side I still write blogs about different companies. For example, Marie Dalgar which is a top Chinese cosmetic company, how they did growth and marketing and I compared beauty bloggers between China and the US and see what are the potential business ideas that you could have. Then when lots of startups start doing that, probably most of the entrepreneurs are female, they’re not sure how to build a startup, how to grow and they’ve asked me to help them. Then I can use my growth hacking skills and all my experience to help them. I think it’s going to be the future of Chinese style of consulting or media firm is you have a content media platform to gain traffic, to gain all the trust.

HANS TUNG: Build credibility.

DORIS KE: Right, build credibility and then people are going to come to you for help and for services and even for FA or consulting of ideas, community groups, study groups and I’m going to build all that to support the her economy.

HANS TUNG: As you spend increasingly more time in China, do you find women executives or women founders have a chance to be themselves more or make bigger impact here or less than their counterparts back in the US whether it’s New York or Silicon Valley?

DORIS KE: I think definitely in China.

ZARA ZHANG: More in China?

DORIS KE: Yeah, more in China.

HANS TUNG: How so?

DORIS KE: I definitely think the female leadership is going to bloom in China because of several reasons. The first thing is because of the single child policy, lots of girls are raised like guys, like boys. For myself, my parents never thought of me as a girl, they always treated me like a boy. I used to play basketball, or sports, all of that. So, I don’t think I am any weaker than guys. I find lots of peers like them. The second thing is that the Chinese education system doesn’t support so much masculinity. So, girls tend to be better. I mean, they can actually perform better than guys. In the western world they guys need to do sports and all that.

HANS TUNG: Football, and soccer.

DORIS KE: In China you just need to have a good score. Then actually girls are better –

HANS TUNG: At academics.

DORIS KE: At academics, right. So, that’s why there are so many excellent women out there right now rising in China. The third thing is back in the history of China, because it’s cultural revolution I think lots of people, it’s called Tongzhi 同志, right back in the day.

HANS TUNG: Comrades.

DORIS KE: Right, and you don’t say it’s a female comrade or a male comrade, it’s just comrade everyone is equal. So, I think women get to have more equality actually in China in the future. I definitely see that happening. I saw lots of female entrepreneurs already rising up, YCloset for example. Also, The Look, Abox, there are lots of cosmetic companies already rising.

HANS TUNG: Right. Interesting.

ZARA ZHANG: You’re very connected Jiediqi 接地气, to the land, as we say out of all the Haiguis 海归 I know. Do you have any tips for how to adapt to China quickly as someone who returns from the US?

DORIS KE: I would say cut down the number of times you use English, especially when you mix it. It will just make people hate you. So, I almost forgot how to speak English until you guys invited me on to this. I use lots of buzz words also.

ZARA ZHANG: Like Bihuan 闭环 (close the loop), Jiangwei Daji 降维打击, Liebian 裂变 (viral growth), Hongli 红利 (dividend).

DORIS KE: Jiangwei Daji 降维打击, and Hongli 红利. I’m so familiar with these words. That’s actually the words that make investors trust you more.

HANS TUNG: A lot more.

DORIS KE: They’re like, “Oh, you’re not that American. You actually know Chinese style.” So, that’s what I usually teach people, “Learn this vocabulary before you come back to China.”


DORIS KE: Then second is really be openminded. Don’t feel superior. I actually think people who never went abroad, there are so many of them that are so much smarter than people who went to the US and start there elite, but you’re actually not. I just think you always need to learn more and be openminded.

HANS TUNG: Those are two very good advices. So, you’re a very prolific writer in Chinese and you have published many articles on WeChat as we mentioned earlier and some of them have become very viral. You also have written a lot on topics of US and China cultural differences like we discussed so far on the show. One of these as Zara told me, is that you also used growth mindset to find your boyfriend, now husband. What does that mean and how have you applied what you have learned to your private personal life as well?

DORIS KE: I always like to think about lots of things and see whether there are some theories in common behind that. So, when I was thinking about growth hacking in a product, you basically find an MVP and then you do A/B test, and then you find the first scenarios to test it and you improve it until you find the PMF. Then in terms of your romantic relationships, that’s similar. I almost got married after I graduated when I was with a boyfriend from Fudan University. I should have mentioned all this. I have like a big mouth.

HANS TUNG: It’s insightful.

DORIS KE: But I felt like, “Oh my God, what if I regret it later? Is he going to be the best one? Is it PMF?”

HANS TUNG: Probably not a good fit, right?

DORIS KE: You don’t even know. Like, I just felt like I need to do some A/B test.

HANS TUNG: So, did you date multiple people and find out?

DORIS KE: I was like, “How about we take a break?” He was like, “No, let’s break up.” I broke up with him and that’s when I went to New York and I had some dates with different styles. I actually made notes like, “This is western style. This is Chinese style. This is banker style. This is tech style.”

HANS TUNG: You tagged them.

DORIS KE: Then I went out with them and see how I felt, and I definitely know which are the type of guys I definitely don’t like, like bankers are douchebags, never. They are so proud of themselves. Then later I found out – I carved out what my target audience looked like.

HANS TUNG: What’s that tag?

DORIS KE: The persona is like he needs to be not bad looking. He needs to be smart and then he needs to like startups so we can talk a lot about that. I like good looking guys to be honest, that’s very bad. Then he needs to be honest, not like lying, so trustworthy.


DORIS KE: So, all of these characteristics I found out that’s probably a guy in Silicon Valley doing tech job. Then, I’m like what kind of companies? That’s actually a coincidence, I went to Uber to do a collaboration between Alipay and Uber and Uber has all the tech actually called China real team.



HANS TUNG: In San Francisco, that’s right.

DORIS KE: In China because all their data system is in US, it couldn’t have engineers in China. Then all this group is Chinese, smart, tech guys, interviewed, filtered already by Uber.

HANS TUNG: Thank you TK.

DORIS KE: Thank you TK. It’s very targeted. I didn’t even think about that, but when I went to Uber and I was doing this recap with them in a meeting then my husband walked in. Back then he was not my husband and he’s like really honest and pointing out all the mistakes he made, what information he should have and he’s good looking. I was like, “Oh my God, that’s the guy.” That’s how I knew my boyfriend. Then later I setup a celebration dinner with Uber.


DORIS KE: I arranged it. All my wing women were over there and they’re like setting us up and he didn’t actually know that I set all this up. Then we got to know each other and then later we got married. That’s my story. Looking back, I just made fun of it, “That’s just like growth hacker, growth mindset.” You shouldn’t just marry someone because your age is there and then regret afterwards. You should just do as many tests as possible and then know what are the guys you’re really into, what are the guys you should really not date. Then just be happy with the guy in the end. I think that’s a very good story.

ZARA ZHANG: Great tip.

HANS TUNG: Very good tip.

ZARA ZHANG: A quick-fire question: what’s a habit that you think has changed your life?

DORIS KE: I think writing actually. I write things in my high school, I write blogs. But back then it’s not a public blog, I just write to myself because very time I’m angry, I’m frustrated, I’m confused I always write down to talk to myself. That’s a habit that really changed my life.

ZARA ZHANG: What did you do for fun?

DORIS KE: I’m not a fun person.

HANS TUNG: Very purposeful.

DORIS KE: What do I do for fun? I used to write for fun.

ZARA ZHANG: But now writing is your job.

DORIS KE: Now writing is my job.

HANS TUNG: Writing is your purpose.


ZARA ZHANG: What’s something you read recently that you recommend?

DORIS KE: Poor Richard’s Almanac.

HANS TUNG: Wow, you find that interesting?

DORIS KE: I just think it’s very helpful. To me, I’m a marketer, I don’t know investment that much and then how people make decisions to invest.


DORIS KE: Lots of people talk to me about this book and says, “It’s a really deep book but you should read it.” I read it, it’s really interesting because he talked about you should always do things that’s within your capability not beyond your capability. Also, instead of just studying marketing, to do marketing you should study all other subjects such as math, physics, finance, investment and all of that so that you can have a very robust knowledge system. I definitely agree with him. That’s why I actually jumped around from brand management to communications to ops, to right now it’s media. I think everything is related. They have a similar system behind it, and you should always learn more stuff and so that’s really helpful.



ZARA ZHANG: That’s all the time we have for today. Thank you so much for making the time. This was really fun.

HANS TUNG: Yeah, thank you. It was indeed very fun.

DORIS KE: Thank you guys.

Episode 29: Orion Zhao of Moka on Being a Sea Turtle Entrepreneur and SaaS in China

This is a cross-over episode between 996 and Founder Real Talk, which is a biweekly podcast hosted by GGV managing partner Glenn Solomon.

Glenn and Zara interview Orion Zhao (赵欧伦), the co-founder and CEO of Moka, a fast-growing HR SaaS startup in China. Moka helps companies increase the efficiency of their hiring process by providing a CRM software solution. It currently has hundreds of customers in China, including the likes of Xiaomi, Sougou, Burger King, and Levi’s. Moka has completed its Series A+ fundraising round and is a GGV portfolio company.

Orion is originally from China and graduated from Berkeley in 2013. He then spent close to two years working as a software engineer at Turo before returning to China in 2015 to start Moka with his co-founder Li Guoxing who is also a Chinese overseas returnee from Stanford.

Orion discussed the challenges he faced as a “sea turtle” (海归) entrepreneur, why his experience joining a business fraternity at Berkeley came in handy in China, how he manages employees who are older than him, and the status quo of China’s SaaS market.

ZARA ZHANG: Hi listeners! For today’s episode, we have a cross-over show with our sister podcast, Founder Real Talk, which is hosted by our managing partner Glenn Solomon based in Menlo Park. Glenn has led many of GGV’s investments in enterprise SaaS companies in the US. Founder RealTalk is a biweekly podcast where Glenn interviews founders and startup executives about the challenges that they face, and how they’ve grown from tough experiences. This episode is an interview with Orion Zhao 赵欧伦 the founder of Moka which Glenn and I recorded in Beijing. 
Also, we’ve had two very fun 996 Community meetups in the last month, one in Beijing where we had over 200 attendees, and one in Shanghai where we had dinner with 40 of our listeners. We frequently host offline events where you can meet not just members of the GGV team, but also other like minded folks who are interested in tech in China. All of these events are announced in our listeners’ WeChat groups and Slack channel. You can join these at 996.ggvc.com. Enjoy!

GLENN SOLOMON: Hi everybody. I’m excited today to have Orion Zhao as our guest. And we also have my colleague Zara Zhang as our guest host. Orion is the founder and CEO of Moka which is a fast-growing HR SaaS startup in China. GGV invested in Orion’s company in the pre-A round in late 2016 and the company’s been growing fast ever since. Moka helps companies increase the efficiency of their hiring process by providing a CRM software solution. It currently has hundreds of customers in China including the likes of Xiaomi, Burger King, Levi’s and many other recognizable names. I’m also really excited because this is the first time we’ve interviewed a China-based founder or CEO for Founder Real Talk. In fact, we’re recording this in Beijing as we speak.

Orion is originally from China but graduated from Berkeley in 2013, so he’s now a returnee to China. He spent close to two years after his years at Berkeley working for Turo in the Bay Area before returning to China in 2015 to start Moka with his co-founder who’s also an overseas returnee from Stanford. So Orion, welcome to Founder Real Talk.

ORION ZHAO: Thanks for having me.

GLENN SOLOMON: So first question for you, maybe start by telling us a little bit about the company. Tell us about Moka and why you decided to start it.

ORION ZHAO: When I first came back to China, I actually had no idea what I was going to do. I was thinking about maybe joining a company or I could start a company. So I was looking for opportunities. I was working at Turo, so we did a lot of anti-fraud stuff. So I was looking at Ant Financial which does a lot of credit analyzing and stuff. And I realized that they don’t put a lot of emphasis on their recruiting side, their career side. That got me interested because in the US, companies all have really fancy career sites. I went to talk with a bunch of HR people in China, and I realized that they have some real pain points besides the career page such as collaboration between HR and their hiring managers and the interviewees. And also they had problems collecting all the talent banks. And lastly, they had problems analyzing their recruiting data. So I found those pain points are real. Then I looked at the market and there’s no really good product solutions out there. So I decided to build one myself.

ZARA ZHANG: Has it always been your plan to return to China or did it happen organically?

ORION ZHAO: I think more organically. It was not planned. Long term plan, I was thinking about coming back to China eventually. But it sort of happened when I was feeling, “I feel like I learned a bit in the US already. I want to come back and see what’s going on in China.” I guess it wasn’t really planned out.

GLENN SOLOMON: So when you decided to start Moka, you had already come back to China and realized this problem that you just mentioned. It wasn’t like you understood that problem while you were in the US?

ORION ZHAO: Yeah. I was anxious in the US. I saw the big run of financing happening in China, so I knew the market was really hot. But I didn’t know what was going on there and I had this fear of missing out. I felt like, “I’m in San Francisco. Everything’s going well. But what are the opportunities in China?” I’m trying to understand in the US but the environment’s just so different. So I decided to take a leap of faith, not knowing anything, and come back and then look for problems to solve. I originally gave myself six months to discover what to do. Actually it only took me two months to find the idea of Moka.

ZARA ZHANG: I had the same feeling. I think that FOMO is universal to all Chinese students who study abroad these days. You read all the news, all your WeChat Moments, all your friends doing interesting things. And everyone’s coming back.

GLENN SOLOMON: What were some of the challenges you faced coming back as a returnee. Did you feel like the time away actually took you further away from what was going on in China and really understanding the market? Or were there valuable lessons learned in Silicon Valley that you could bring back? Was it more a positive or a negative?

ORION ZHAO: It’s a really good question. I think there’s positives and I think there’s also some, not negatives, but things that I need to improve more. I guess I would start with the things that I learned a lot that helped me in the US. The one thing that I learned in college was networking. I was lucky to join a business fraternity in Berkeley called Beta Alpha Psi. Through that experience I learned networking’s actually really important and I think I learned some of the skills. So it helped me to know how to network. And that goes to the downside of being a sea turtle or returnee. I have no connections here in China. I don’t know who to call to discover problems. But I do have the skills to network. So I would ask my friends, “Can you make this intro?” or “Can I talk to this person?” and then get that person to introduce me to another person. So I do have the skills, but I don’t have the resources. But I feel like my education in the US really helped me have the skill to learn, have the skill to network. Those things are more valuable and go longer term. But the resource really hinders me on recruiting. I have no connections in China, so I don’t know who are the reliable coworkers or colleagues to hire. That slowed us in the beginning. It was really hard to recruit. As I gradually built my network, now I know more people in China.

GLENN SOLOMON: So you eventually could overcome that challenge just by working hard at it, but it wasn’t easy.

ORION ZHAO: It was not easy. I think in the first year of Moka, I probably interviewed 500 HRs who I’d never known. I would go onto recruiting websites and send my resume. They would ask me to interview for positions, and then I’d say, “Oh, actually–”

GLENN SOLOMON: “I want to interview you.”

ORION ZHAO: Yeah. “I’m discovering these ideas. Do you have this pain point?” And I’d start the conversation that way.

GLENN SOLOMON: That’s creative. So, if you look at the market in China, particularly for SaaS and cloud-type solutions, how would you define what stage of the market we’re in in China? And you’ve seen the US, so how do you contrast that with the US?

ORION ZHAO: I think in China, the SaaS market’s really early. In China, there’s software companies, but they’re mostly on-premise. And the SaaS wave just started in 2014 or 2015, so it’s really new and early. Whenever I go back to the US or Glenn introduces me to ATS companies who are in a similar space to us, I feel like ATS, which stands for Applicant Tracking System – that’s what we do – I feel like ATS in the US is a commodity. Everybody uses it and they understand the value of it. But in China, I have to educate the people, even for senior levels. When we talk to some CEOs, they won’t even understand the value behind the software. And then we take time, “You can really increase the efficiency. You can collect all your data and do your business in a more data-driven way.” So I think the market’s very early.

GLENN SOLOMON: What kind of challenges has that presented? If you’re in an early market, you can’t just rely on the fact that your customer’s going to understand what you do. They’re not going to have budget for what you sell. How do you deal with that?

ORION ZHAO: I think it goes three ways. The first challenge would be raising funds. Most of the investors in China have never had success investing in enterprise companies. So most of them don’t see the upside. They don’t think it’s a big opportunity. So raising funds is challenging in the enterprise space or in the SaaS space in China. That’s number one. Number two is recruiting talent. There’s no successful SaaS business in China. In the US, you can say, “Oh, there’s Salesforce. There’s Workday.” But in China, there’s no such big companies. And talent would not come to us. They would rather go to Alibaba or they would go to Tencent, Weibo or WeChat. So the second challenge would be talent. Lastly would be acquiring customers. It takes time to educate them. And also, their willingness to pay is relatively low. But in the market we see it growing tremendously. Those are the three challenges I guess.

ZARA ZHANG: So who was your first customer and how did you find them and convince them?

ORION ZHAO: There’s a really cool story about this. I was not even ready to launch the product in a commercial way. I think it was April 2016. I got a call from a recruiter saying, “Can I try the product or can we buy it?” I was like, “We were in beta. How did you discover us?” We were posting a recruiting post on a technical discussion board, and that recruiter also recruits people on that technical board. He saw, “According to the description of the company, this is something interesting that I want to use.” So he called me up and asked me for a product introduction, like a PPT. And I had nothing. I had no introduction stuff. I made that overnight and sent it to him, and after a month we closed the deal. That’s our first customer.

GLENN SOLOMON: That’s awesome. It also probably gave you an indication, like, “Okay. There’s a market here.”

ORION ZHAO: Yes, definitely. A very strong indication.

GLENN SOLOMON: You mentioned one of your big challenges has been recruiting a team, but you’re over 100 people today?

ORION ZHAO: Yeah. 130.

GLENN SOLOMON: When we invested, you were 20 or 30 people, so you’ve grown by over 100 hundred heads since we invested. You’ve obviously overcome that issue. How have you done that? And what are some of the tactics you’ve used to get the best people when you’re competing with the likes of Alibaba and companies like that for talent?

ORION ZHAO: I think it still remains challenging, but there are some techniques that I can share. I guess one thing is, ask for references. I think I actually read this on some US blog or maybe Quora. You ask someone you think is very smart and ask them who would be the person they would refer, and then talk to that person. And then ask for another referral. That person will probably be pretty good. I use that technique all the time through my networks. And one thing is to be very persistent. Once you find a talent that’s really good, stay in touch and always try. They will feel like you’re very sincere about it and also very persistent about it. Over time, as the company grows in a positive way, they will eventually join. In the early days it’s really risky, but later on they will see the progress.

GLENN SOLOMON: It sounds like for you recruiting has been very personal. You are out there yourself, hand-to-hand combat, trying to close the best candidates. Now, about this time – 130 people, 150 people – our experience is it gets harder for the CEO, or founder in this case, to be centrally involved in every new person coming in. How are you going to scale that?

ORION ZHAO: That’s a really good question. I guess I have two ways to solve that, not entirely, but to help the situation. The first one is you have to have a really strong HR team. It’s really important to have recruiters who are dedicated on recruiting, especially when you’re growing really fast. So we had this mistake earlier this year. In the first half of this year, we only had one recruiter. We didn’t know how hard it would be to recruit a huge team. We thought one person would be enough. But now we realize that’s not the case and we now have four recruiters. We quadrupled the team and it’s really helping us to move the funnel and move the needle. So the first answer would be having a really strong HR team and recruiting team. The second part is on culture and leading by example. I go out of my way to hire my direct reports. I’m very persistent. And that shows a good example to the other hiring managers. They will go out of their way to hire their direct reports. And I think having that sort of mentality and culture in the company, that hiring is not only the recruiter’s problem, but also the hiring manager’s job, is really critical.

GLENN SOLOMON: I’m guessing you use your own product as well, right?


GLENN SOLOMON: That must help.

ORION ZHAO: Totally. I think it helps a lot. Actually, we successfully rediscovered some of the talent that we interviewed early on, and have them on board now. When we were only about 30 people, people were scared to join an early startup. But we still kept their records in the system, and we had all the interview comments. And when a recruiter joined us, they would look into our system and see, “Early on, Orion liked this person. Why don’t we nudge them again?” And we actually closed two of the talents.

ZARA ZHANG: Do you hire a lot of Chinese overseas returnees or do you prefer more local talents?

ORION ZHAO: We actually don’t have too many overseas returnees in our case. We don’t really have a preference. We only look at the skill sets and stuff. But I guess on the manager level, I personally prefer to have local people because they have the connections. So it will be easier for them to recruit their team rather than like us. We had to build a network all over again.

GLENN SOLOMON: As you’ve been building out your team, have you hired some pretty senior-level folks?

ORION ZHAO: Totally.

GLENN SOLOMON: What’s the market like in China for senior talent? Are you using the same techniques to find those people as well or do you have to do executive searches to find the right people?

ORION ZHAO: I think the techniques are the same. But one thing I noticed is different from the US is that in the US, senior talent care about equity and they understand it. In China, they don’t understand that much. And I think the reason behind it is because not many people have made money through equity. They were mostly just earning cash. So in the China talent market, I think senior leaders have a relatively poor understanding of how equity works. Last night I was trying to explain my offer to a senior leader, a technical leadership role in Beijing. Even though he was been working for more than 10 years, he still cannot really understand how equity works, how vesting works.

GLENN SOLOMON: And this is a technical leader?


GLENN SOLOMON: I think there’s actually some similarities to the US. The value of equity is difficult to convey to some engineering folks in the US as well. But there’s more of a culture of people knowing that you can make a lot of money if your company does well and you’re an equity owner. That piece, people have figured out.

ORION ZHAO: In China, not the case.

GLENN SOLOMON: Interesting. So, as you think about your own life and your experiences so far, we talked a little bit about the fact that you were in the US and you came back to China. Do you think that’s making you a better leader? If you had to do it all over again, would you make the same decisions or try something different?

ORION ZHAO: To the first question, I think it did make me a better leader in a lot of ways. I will come back to that later. The second question: would I make a different choice? That’s hard to say. Maybe I would stay a little bit longer in the US to have more management skills and see Turo growing bigger. I guess more experience might help, looking backwards, but it’s hard to say whether I would make the same decision. To the first question, how my experience and education in the US made me a better leader, people in the US value innovation a lot and people tend to think about how to create value long term. I think that mentality helps a lot.

GLENN SOLOMON: Have you had turnover in your company or have most of the people stayed who you want to keep?

ORION ZHAO: We did have some turnover, yeah.

GLENN SOLOMON: So why do you think that’s happening? One thing I observed in China is that the war for talent is as severe as it is in the US, maybe even more. So you do see people picking up and leaving companies pretty quickly and – maybe it’s the FOMO thing – trying to find the next great thing. How do you prevent your employee base from thinking about their next job and focusing on what they need to do to help Moka build something special?

ORION ZHAO: That’s a really tough question. I think probably a lot of founders have that same challenge. A couple of techniques that I think are important. First, hire leaders that are really charming and know how to lead a team. They can really have the folks under them working hard, but at the same time feeling like they are learning new stuff. Leaders who are thoughtful about training people and making people grow. That’s the number one piece, have really good managers. The number two thing to do is pay market price. When you see a person is growing and making contributions, make sure they’re also compensated well. Those are probably the only two things that I think can help the situation.

GLENN SOLOMON: How about culture? Do you guys intentionally build your culture at Moka and, if so, what is your culture and how important do you think that is to attracting great talent and then retaining that talent?

ORION ZHAO: I think that’s a really important piece too. We really care about culture. In the very early days, me and my co-founder, we would write down what’s the culture. Over time, we would come back to see, “Is that still the right culture that we want to keep.” In Moka we have six items. First is ownership, second is excellence, third is be open, think different, customer-centric, and lastly will be candid and straight. So I think culture is critical to maintain people in the company. We do it through all-hands. We do bi-weekly all-hands. And I feel like the younger generation of Chinese talent really enjoy that. Our company’s really transparent and they won’t find that somewhere else. So that definitely helps us to retain talent. Because our company stays very transparent, people get a lot of exposure. They feel safe. They know what’s going on. They know how much money is left in the bank. They know the revenue is growing really fast. I think that’s a key element.

GLENN SOLOMON: Does that make it unique in China to have these all-hands frequently and have a lot of transparency? In theory it sounds good, but have you ended up having some unintended consequences of being so transparent and open? Do people leave because they get scared because they have too much information?

ORION ZHAO: Some people got scared at first, but then they got used to it. That’s something that I found very fascinating, the power of culture. I have a direct report who was born in 1978, so she is 40 years old. So a lot of habits are really stubborn. She is not that open-minded. After joining the company for half a year, she started to realize that she is changing. During our one-on-one, she asked me, “It’s been a year in Moka and I’m sort of lost. I feel like I’m changed, but I don’t know whether it’s positive or negative.” And I told her that, “I think it’s a good change because you’re becoming more open. You talk with your husband more openly. You talk with your colleagues more openly. You’ve become happier than your last job.” Because in her last job, people were not supposed to say things publicly. They are supposed to say good things in public, but not bad things. So she would hide some negative emotions which made her suffer. So I feel like the power of culture is really strong.

ZARA ZHANG: You’re part of the post-90s generation of founders, those born after 1990. How do you manage people who are older than you?

ORION ZHAO: That’s a good question. There’s some principles in management that I enjoy summarizing from time to time. One principle I really like is that the only one way to lead is to lead by example. So I act the way that I want my leaders to act. I will use the same standard to them as well. Another thing to manage them or lead them is through personal caring. I do one-on-ones a lot. I think some Chinese companies don’t do one-on-ones, but I feel like a one-on-one is really personal time where you can show that you care for that person a lot personally, their family, career growth and stuff. Those are some techniques.

GLENN SOLOMON: That sounds very compelling. So, I get to see you in the US pretty frequently. You come to the US quite a bit and I can see your networking skills at work. You do a good job of building out a broad net. You cast a wide net of people that you’ve gotten to know who are, in one way or another, helpful to you. Why have you done that? Why do you spend time in the US, what do you get out of that, and is it something you’d recommend to other founders here in China?

ORION ZHAO: I totally would recommend it. Especially in SaaS, the business that we’re in, we’re years behind the US market. So those founders or senior leaders who are in the SaaS business in the US, they have seen it all. They know the pitfalls. They know where they should emphasize, where they should spend their money, where you should focus. So talking with them really helps me avoid some pitfalls. I definitely recommend it. I can give a concrete example. Recently, we were thinking about building PaaS stuff. Through talking with senior leaders at ServiceNow–

GLENN SOLOMON: Like platform-as-a-service?

ORION ZHAO: Exactly. Platform-as-a-service. Because later down the road when we serve enterprise, they will have customization needs. So when talking with senior leaders at Workday, ServiceNow, and Salesforce, you understand how they build their PaaS systems, and that really helped us to avoid some pitfalls.

GLENN SOLOMON: Do you find that people are generally pretty open when you ask to talk to them?

ORION ZHAO: I think so.

GLENN SOLOMON: That’s great;

ZARA ZHANG: When you first started the company, did you model yourself after any American company or was it more of an idea that came to you?

ORION ZHAO: I think it was an idea that came to me. Like I mentioned, I didn’t really plan it. But after the idea came, I did look into the US market to see, “What does the market in the US look like? Is it a viable business?” So I did find companies like Greenhouse, Lever who were really hot on press back then, like 2015 when I started Moka. Those are some of the companies that we are very similar to.

GLENN SOLOMON: Thinking a little bit about Moka longer term, you guys are growing super fast right now, which we’re really happy about as a shareholder. How do you keep that going and what are some of the concerns you have that keep you up at night as a result of that really fast growth?

ORION ZHAO: How do we keep that fast growth? I think it’s through talent. I think talent’s really, really important. We do have a good strategy going after the market because the Chinese market has a huge demand for HR software. But the thing is, building HR software is not an easy job. So I think the biggest challenge, or what keeps me up at night, is the talent. I spend 60-70 time recruiting my senior leadership. So that would be Moka’s biggest challenge and mine.

GLENN SOLOMON: As you think forward, if you’re able to continue to grow effectively, what does success look like? How will you know when you can say, “I’ve done what I wanted to do with Moka.”?

ORION ZHAO: The vision of the company is to empower companies through HR technology. We’re going to roll out more and more offerings. After recruiting, we’re probably going to do onboarding and organization management and payroll and performance, similar to Workday’s offering. I guess a mid-term milestone, like four-year, will be to hit a scale where we’re able to IPO in the US. That’s in four years. That’s just a small step. And later, we’re just going to continue to grow and add more product offerings to the product line.

GLENN SOLOMON: Have you guys added new products yet from your main ATS product line?

ORION ZHAO: We haven’t added a whole new suite yet, but we did add an AI feature which was pretty big on the talent rediscovery part.

GLENN SOLOMON: How hard is it to add a new product, particularly to a SaaS business like yours?

ORION ZHAO: I think it’s pretty hard, especially in China. That’s one thing that’s different from the US in China. We pretty much have no good enterprise product guys in China because there’s no successful enterprise products. So it’s really hard to get talent. We have to train our talent. We have to tell them how to think long term, how to say no to customization needs. That’s the challenge in building enterprise software in China.

GLENN SOLOMON: Have you thought about trying to bring in product managers who have experience in the US, who are maybe more used to that kind of environment? Or are you yourself trying to get some more connections to really smart product people in the US?

ORION ZHAO: Yeah, definitely. I think that would definitely help. Actually, one of the reasons why I was in the US two months ago was trying to recruit product and technical leaders. I think that would help, but it’s really hard to recruit people from the US because normally those senior leaders already have families. It’s really hard for them to move back to China now when they are in a stable situation. But it would be helpful and we look forward to having some senior leadership, or maybe just junior people, from the US join us on the product and engineering side.

ZARA ZHANG: When and how will you go global?

ORION ZHAO: That’s a tough question. We’ve been thinking about it. We think the US market’s very interesting, but our product’s still not at the stage of maturity. It’s still iterating very fast. So maybe three to five years, but it’s really hard to say. And building the local sales team and marketing team will be a big challenge. I have to have the China market done first and then maybe think about the US or global.

GLENN SOLOMON: So for now, it’s focus on the China market, win China, and then go from there?


GLENN SOLOMON: I think that makes a lot of sense. It’s hard enough for companies in mature markets to go global, and you’re in a market where it sounds like you have a lot of work to do to keep growing it. The good news is, it’s wide open. So you could get very big just focusing on China. And as you expand into new products, that should give you the opportunity to really become quite a big company.


GLENN SOLOMON: The metrics that companies use in the US to measure success with SaaS, both internally and for the financial markets and investors, are pretty well known now. And you guys have adopted a lot of those metrics. Do you think that makes you unique in China or do you think Chinese companies have caught on to what the US SaaS market’s metrics people care about?

ORION ZHAO: I think it does make me sort of unique. That’s one thing that GGV definitely helped us with a lot. I don’t think a lot of founders in the China market understand how those metrics work. So I think GGV having a global view definitely helped us to know what to measure. For example NPS, ARR, retention churn, LTV, CAC, all those things I measure and we do it rigorously. So when I go out fundraising, we’re quite unique to the investors in China. They rarely see this very detailed, very rigorous metrics monitoring.

GLENN SOLOMON: So you’re teaching them versus the reverse?

ORION ZHAO: Yes. Sort of.

GLENN SOLOMON: That’s great. Orion, this has been awesome. We’re at the stage of the episode where we’re going to go to the hot seat questions. Zara and I are going to fire some questions at you. Just say the first thing that comes to your mind. First one, tell us about an entrepreneur or a founder that you have respect for and why.

ORION ZHAO: I think Bill Gates. He gave me the inspiration for entrepreneurship.

ZARA ZHANG: What’s a book or another piece of content that you enjoy reading that you recommend to other founders?

ORION ZHAO: I think High Output Management by Andy Grove.

GLENN SOLOMON: That’s a great one. An oldie but a goodie. How about for those listeners who may be coming to China some day, what’s a good place you’d recommend to come visit when you’re in China? Apart from the Moka headquarters.

ORION ZHAO: Yeah. Moka headquarters would be a recommendation. I think the Forbidden City is a very cool place to visit.


ORION ZHAO: Yeah. In Beijing.

ZARA ZHANG: What types of roles are you hiring for at Moka and how can people reach out if they’re interested?

ORION ZHAO: Oh, thanks. We’re hiring a lot on the product side, so product managers and also engineers and designers. If they’re interested, they can reach us at hello@mokahr.com.

GLENN SOLOMON: And if you apply through that, you’re going to be in the Moka ATS.


GLENN SOLOMON: Awesome. Orion, thank you so much for spending time with us on Founder Real Talk. This is a great episode and a great way for our listeners to get initiated into the China market. Thank you.

ORION ZHAO: Thanks for having me.

ZARA ZHANG: Thank you.

HANS TUNG: Thanks for listening to this episode of 996.

ZARA ZHANG: GGV Capital is a multi-stage venture capital firm based in Silicon Valley, Shanghai and Beijing. We have been partnering with leading technology entrepreneurs for the past 18 years from Seed to pre-IPO. With $6.2 billion in capital under management across 13 funds, GGV invests in consumer new retail, social, digital internet, enterprise cloud and frontier tech.

GGV has invested in over 290 companies with more than 45 companies valued at over $1 billion. Portfolio companies include Airbnb, Alibaba, Ctrip, Didi Chuxing, DOMO, HashiCorp, Hellobike, Houzz, Keep, Slack, Square, Toutiao, Wish, Xiaohongshu, YY and others. Find out more at ggvc.com.

We also highly recommend joining our listeners’ WeChat group and Slack channel where we regularly share insights, events and job opportunities related to tech in China. Join these groups at 996.ggvc.com/community.

HANS TUNG: If you have any feedback on this podcast or would like to recommend a guest, please email us at 996@ggvc.com.

Episode 28: Chuhai: Why Chinese Entrepreneurs are Targeting Emerging Markets Across the World

GGV Capital’s Hans Tung and Zara Zhang discuss the trend known as “Chuhai” (出海), or Chinese founders targeting emerging markets outside of China, such as Southeast Asia, India, Latin America, and more.

As the mobile Internet market in China reaches saturation, an increasing number of Chinese entrepreneurs are now eyeing other developing markets where mobile Internet is just starting to take off; in fact, many of these countries are seeing their Internet sector dominated by Chinese companies. Factor Daily recently reported that 44 out of the 100 top apps in India (Google Play) are made by Chinese companies.

What are the reasons behind the “Chuhai” wave? How can they best recruit local talents and bridge the cultural gaps? How can they avoid the same mistakes that the US Internet companies made when then came to China?


ZARA ZHANG: Hi everyone. We’re excited to announce that GGV Capital recently launched a new podcast in Chinese called Startup Insider, or Chuangye Neimu 创业内幕 in Chinese, which is produced by my colleague Lily based in Beijing. Just like 996, Startup Insider features interviews with top founders and executives from China’s technology scene. Imagine a 996 podcast, but in Chinese. The first episode was with Liu De who is the SVP at Xiaomi 小米 and head of the Xiaomi ecosystem. If you’re a Chinese speaker, I highly recommend checking out this show on Ximalaya 喜马拉雅. You can find it by searching Chuangye Neimu 创业内幕or Startup Insider.

HANS TUNG: Hi there. Welcome to the 996 podcast brought to you by GGV Capital. On this show we interview movers and shakers of China’s tech industry as well as tech leaders who have a US-China cross-border perspective. My name is Hans Tung. I’m a managing partner at GGV Capital and I’ve been working at startups and investing in them in both the US and China for the past 20 years.

ZARA ZHANG: My name is Zara Zhang. I’m an investment analyst at GGV Capital and a former journalist. Why is this show called 996? 996 is the work schedule that many Chinese founders have organically adopted. That is, 9 am to 9 pm, 6 days a week.

HANS TUNG: To us, 996 captures the intensity, drive and speed of Chinese internet companies, many of which are moving faster than even their American counterparts.

ZARA ZHANG: Hi everyone. On this episode we’re going to continue our new series where Hans and I will talk about a topic of interest currently. Today we wanted to cover a phenomenon called Chuhai 出海 which literally means going overseas. It’s a phenomena of Chinese entrepreneurs targeting emerging markets around the world. Hans and I and the entire GGV team have been paying attention to this trend for a long time now. I recently relocated to the Beijing investment team and I’ve seen with my own eyes how so many of the startups we’re seeing these days are in this category, where Chinese entrepreneurs are going outside of China to target consumers and users in emerging markets like Southeast Asia, India, Latin America, and even Africa. If you look at the app store rankings in many emerging markets, many of the top-ranking e-commerce and social apps are actually developed by Chinese teams. So Hans, when did you start to realize that Chuhai 出海, or Chinese companies going overseas, could be a big opportunity?

HANS TUNG: I’m probably the first VC in the world that coined the phrase Chuhai 出海. That was back in 2013. I saw a few things that happened in 2012 that made me decide that this area, Chinese companies expanding overseas, could be a huge opportunity for the next 10 years. Three things happened that gave me the sense that this could be an emerging trend. One, when WeChat came out in 2011. The product is so well designed, you feel that this is a product that at least can expand out of China to the rest of Asia. And over the next 18 months, it started to happen. WeChat was willing to make a push into Taiwan and Southeast Asia and India. And today, it’s doing well in some of these countries, including India.

The second thing that happened that caught my attention was Xiaomi 小米. I was part of the team that, as early investors in Xiaomi, helped Xiaomi to recruit Hugo Barra to leave Google and join Xiaomi. This happened in 2013 and we started talking to Hugo as early as 2012. The fact that Hugo was willing to leave as Head of Product for Android to join Xiaomi was a seminal event, I think, not only for Xiaomi, but for the Chinese tech industry. You have an established talent trained overseas, tuned in to where emerging markets are because he was born in Brazil, joining a Chinese company. To this day, I think, his followers on Sina Weibo 新浪微博 outnumber his followers on Twitter. That was the second data point that I thought was interesting, that a Chinese handset player could expand and build a market beyond China.

The third data point that was interesting was that Alibaba was actively looking for ways to partner with SoftBank in Japan, and also looking at expansion and investment opportunities in Southeast Asia, which culminated with their investment in and future acquisition of Lazada in Southeast Asia. And that wasn’t just Alibaba 阿里巴巴 and Tencent 腾讯. Other companies had been trying to do e-commerce and gaming beyond China as well, most recently with ByteDance expanding to social networking. So starting in 2012, these few data points gave me the sense that the Chinese internet sector had already gone through four generations of founders in the internet space. The amount of learning had accumulated. And China is a country with four or five tier cities. So there’s really nothing that has happened elsewhere in the world that doesn’t have a similar condition somewhere in China already amongst those four or five tier cities. So I thought that Chinese companies, once the teams become more globalized and understand foreign cultures better, have the skill set and the requisite knowledge of how to scale and build interesting internet companies outside of China. That was the key reason why I decided to move back to the Bay Area from Beijing, and I’ve been doing investments in this area ever since over the past five or six years.

ZARA ZHANG: Staying in Beijing for the last few months, just from talking with a lot of other VCs and people in the circle, I have a palpable sense that people think mobile internet penetration in China has pretty much reached saturation, so it’s very hard to have that exponential growth that we saw maybe a decade ago. That’s another reason that is pushing a lot of Chinese entrepreneurs to go outside of China, to other markets where mobile internet is just starting to take off.

HANS TUNG: Back in 2013, I did a calculation that Chinese smartphone users, internet users, were roughly around 300 million, PC internet users were roughly about 600 million, and over the next five or six years, both would reach saturation point. And then when the world number of internet users expanded to three or four billion, the next two billion would have to come from outside of the US and China, specifically Southeast Asia, India, Latin America, and to a lesser extent, Africa. So it’s not rocket science, if you know where to pay attention, that at some point in the future, this trend would come. And I thought that Chinese internet founders are ready to take on the opportunity.

ZARA ZHANG: You’ve said before that you can imagine Chinese entrepreneurs moving to Jakarta, but it’s hard to imagine American founders wanting to go all the way there. Why do you think that’s the case?

HANS TUNG: You may have the knowledge of what to do in the internet space, but it’s very difficult to go after an emerging market from your home city because time zone differences and lack of feel of what’s happening on the street makes you less effective when controlling it remotely from back home. So to be effective, Chinese founders or American founders have to be willing to spend time in emerging markets on the ground. And if you look at where American founders are willing to go or send people to, Canada, the UK, parts of Western Europe, Australia, new Zealand, to a lesser extent even Singapore, are obviously places that people are willing to go. They’re easy to move a family to. It takes a lot more commitment to ask people to go to Jakarta, to KL, or even to different parts of China, let alone Latin America and Africa. So just by the ease it takes to move around makes it harder for American companies to expand globally. And looking at the Chinese founders, you can see people working in Southeast Asia, living in India, or even moving to and traveling to Latin America. And you’ve started seeing other opportunities in Africa. So there are more places that Chinese founders and teams are willing to go to and move to and that gives them an advantage to compete on a global basis.

ZARA ZHANG: So why do you think we say that emerging markets will look a lot more like China than the US as mobile internet takes off in these places?

HANS TUNG: When you look at the GDP per capita in India or Indonesia, it’s roughly about $3,000 per person per year. If you look at the GDP per capita for Latin America, specifically Mexico and Brazil, it’s roughly about 9,000, 10,000 per person. 15 years ago, when we started actively investing in China, GDP per capita was roughly about 3,000. And that’s where India and Indonesia are today. If you look at Chinese GDP per capita today, it’s roughly about 9,000 now, comparable to Mexico and Brazil. So it’s very difficult for an emerging market just to copy a model from the US and try to localize it because the stage of development is different for different countries. China spent the first 10 years copying models from the US, but they had to do so much more customization and innovation to make it work for emerging markets. Alibaba and Tencent initially looked like AOL and ICQ Messenger and eBay, but over the first 10 years of Chinese internet history, both became very different companies because the Chinese market is very different. Users have different needs. So as a result, we feel that Chinese consumers have trained Chinese founders and companies to be able to deal with other emerging markets better as well.

At the same time, Chinese teams, in general, are less internationalized than the European and American teams. Chinese teams’ grasp of English and global UI is quite different, so the Chinese teams also need to add more talent that are more globalized to help them to leverage the knowledge they know from China as well. To some extent, we also feel that Chinese companies should avoid the mistakes made by the American companies, and should be more willing to make minority investments or controlling investments into local companies and help them to become local champions. At the end of the day, if an American team or a Chinese team are more willing to transfer knowledge they know and empower local founders to do more, that’s usually a formula that works out better. If you look at Chinese companies such as Alibaba, they took investment from Yahoo, they worked well with some of the Yahoo executives such as Jerry Yang, and that helped them to be able to get validation and focus more on innovation in the home market. So if the Chinese companies and US companies are willing to do that with local champions in Latin America, Southeast Asia, and India, I think that in the long run, they will create bigger outcomes together.

ZARA ZHANG: I think emerging markets across the world are starting to look at Chinese companies instead of Silicon Valley ones for inspiration. This month alone, we have met or heard of the Pinduoduo 拼多多of India, the Toutiao 头条for Southeast Asia, the Meituan 美团 for Turkey, the Yunji 云集for India, the Alipay 支付宝 for Africa, and the 51 Credit 51借贷 for Brazil etc. And if we look at the unicorns in Southeast Asia, pretty much all of them are modeled after a Chinese tech giant. Garena is like Tencent 腾讯 , Tokopedia and Lazada are like Alibaba 阿里巴巴, Go-Jek is like Meituan 美团 , Grab is like Didi 滴滴 , and Traveloka is like Ctrip 携程. And a lot of these Chinese companies have actually invested in these companies as well. So do you think China offers a much better model to replicate for these markets, and what do they need to pay attention to when they try to draw inspiration from Chinese companies?

HANS TUNG: That’s exactly right. Little-known story: when I was investing in China back in 2011, 2012, I was introduced to a company in India called Snapdeal. Back then, they were a Groupon clone trying to find their next biz model. I talked to them about Taobao 淘宝, Tmall 天猫 and JD 京东 . They ended up picking Tmall 天猫 as a model, even though I thought Taobao 淘宝 would be a better fit for them. Then there’s another company called Flipkart that I also put a small amount of money in through another fund. Both are personal investments. Flipkart has since become sort of the Amazon of India and been sold to Walmart. So as early as 2011, 2012, you already started to see some of the emerging markets companies coming to China trying to learn about what the Chinese companies had done in the PC era. The examples you cited were some examples that happened in the mobile internet era. Both in the PC desktop internet era as well as the mobile internet era, we have already seen a lot of founders from Southeast Asia and India coming through China twice a year, sometimes more frequently.

And what’s amazing is that it’s not just the founders that have come. Even the VCs have come. The top VCs from both Southeast Asia and India have come to Beijing and Shanghai, and sometimes they know our portfolio even better than some of our peers in China do. It’s amazing how much they’re willing to study and the amount of knowledge they have. And the sophisticated questions they ask us remind us a lot of what the Chinese VCs and founders did 15 years ago looking at what had happened in the US. VC is a business of recognizing patterns, and it’s very interesting to us that what happened in China 15 years ago is repeating in these other markets.

And what do they have to pay attention to? I think that in every cycle of innovation and growth, you go through certain phases. The initial phase is just try to copy the model that’s worked elsewhere. Over time, as the local teams gain more experience and confidence, they start to realize that some of the problems that they’re solving are common to what’s happening in different parts of China. But at the same time, there are going to be material differences. And so when they are different, how do you apply the differences to your advantage and leverage what you know to create something that’s more localized and fits the local market? That becomes key. If you look at the example of Alibaba 阿里巴巴, if they just copied eBay and charged 15% commission like eBay did, they would never be big. The fact that Jack Ma 马云 ’s willing to make that free so that they can attract more sellers than anywhere else – and when you have more sellers, you have more SKUs – makes it easier for Taobao 淘宝 to become more popular than EachNet 网易 /eBay. And coming up with the local innovation of Alipay 支付宝 , which functions as an escrow service to guarantee that transactions are safe and secure and minimize disputes, is also another great localization that Alibaba 阿里巴巴 did without the benefit of having credit cards and PayPal. So these are the kinds of changes that I’m sure the Indian companies and Southeast Asian companies and Latin America companies are making. And that’s what will make them successful, when they can do that well.

ZARA ZHANG: When I meet Chinese founders, sometimes I sense this hubris that because something worked in China, of course it will work in all these other emerging markets. But a lot of times, the infrastructure is not in place, like mobile payments are not in place or the logistics network is not as strong. WhatsApp is not like WeChat 微信. There’s still a lot of differences. So I think that’s another factor that people need to pay attention to. With these other markets, even though they’re developing fast, there are a lot of conditions that are not in place like they were in China.

HANS TUNG: Right. That’s a great observation. 15 years ago, a lot of American teams showed a lot of hubris when it came to China as well. Sometimes we even see that happen today. They think that whatever works elsewhere around the world should work in China too. Unfortunately, some of the Chinese founders have that same degree of overconfidence as well. And when you do that and you don’t show enough respect for the differences in local markets, you’re in for a rude awakening.

ZARA ZHANG: So what advice do you have for Chinese Chuhai 出海 companies that are trying to hire for local talent to understand these markets better?

HANS TUNG: I think they need to start with hiring local Chinese who have lived in those communities for a long time. For example, if you look at Shopee in Southeast Asia, Forrest and his partner were able to recruit Chris to join them to run Shopee. Forrest himself moved to Southeast Asia after getting his MBA from Stanford. He was born and raised in Tianjin, and his wife wanted to live in Singapore, so they started a business in Southeast Asia. That was in the gaming space. They became sort of the Tencent Games of Southeast Asia. And when they decided to go after e-commerce as well, they were able to recruit Chris to join them. Chris is someone who had worked at Lazada before, and even before that, moved to Singapore when he was in middle school. So he’s someone who grew up through the Singapore education system and had a lot of friends locally. At the same time, he still remained quite Chinese and stayed connected to what was happening in China. If you can recruit talent locally that understands both China and the local market, then they are able to figure out the similarities and differences and make adjustments accordingly. So having people who know the local markets well but at the same time have Chinese roots is the first kind of executive that Chinese companies should hire in order to leverage. Over time, many of the people that report to Chris are from Southeast Asia itself. You have to have local teams that understand how the local consumer tastes are different, but at the same time, you continue to leverage lessons learned from China to help you to stay ahead of your competition. Teams that are more cross-cultural and cross-disciplinary and know the differences and similarities and are able to make the right adjustments will most likely succeed best.

ZARA ZHANG: And what about the other types of talent? In markets like India, there are not a lot of Chinese people who moved there a long time ago. There’s less of that.

HANS TUNG: In places like India, it’s easier to see that a lot of talent from Huawei 华为, ZTE 中兴 , Alibaba 阿里巴巴, who have operated a business there on behalf of these Chinese companies, end up either coming out or joining startups that are tackling those markets. So if you don’t have overseas talents who have lived there for a long time, the next best thing is to hire Chinese executives who have operated in those markets for five to ten years to help you get started. But over time, the ability to recruit and build a local team is critical. If you can do that on top of the Chinese knowledge you have, your chances of succeeding will be much higher.

Having said that, should companies that have done well in China expand to Southeast Asia or India on their own? Initially, they should probably try. But by the time they start going into those regions, there will be companies there that want to be the local version of what you’re doing. So be open to partner. After you compete and get a sense of how the local competitors behave and how strong they are, it actually makes sense to explore strategic investments and be able to partner. The more you’re willing to partner, that should grow the pie bigger as well.

ZARA ZHANG: I think there’s a lot of power in combining founders of very different backgrounds into one team. There are a lot of cross-border e-commerce companies that are trying to leverage the Chinese supply chain to sell to these emerging markets. But the people who understand supply chain in China tend not to understand local consumers in these markets and vice versa. So if you have two people who are very good at each being co-founders together, it can be a very powerful combination.

HANS TUNG: One of the best investments that I made was probably Wish. The co-founders came from Eastern Europe and China, met in school in Canada, and were trained professionally in California before teaming up to do Wish. So you have people from different parts of the world, both technologists so they have a common background. And at the same time, they were willing to add a local team in Shanghai that we helped them to get started, and they were able to hire a lot of folks from China to help with the supply chain. That seems to be the formula we’ve seen in other places and other categories as well. Founders with different backgrounds willing to partner with different skill sets, willing to work together, are more likely to build more successful cross-border businesses.

ZARA ZHANG: So I guess one tip for prospective entrepreneurs is to step out of your comfort zone and make friends from other backgrounds, perspectives, or skill sets. I think it will always pay off in the end.

HANS TUNG: Yes. When we give talks at different MBA programs, whether it’s in China or the US, we highly encourage people from different disciplines to get to know one another. The example you gave for e-commerce, it makes sense for someone who’s a supply chain expert to work with someone who’s better in consumer-facing areas. In the area of enterprise, we also see teams do better when they have a strong salesperson that knows how to get SMBs to adopt the technology, plus someone who has a very strong software or SaaS development background to be able to architect the product and understand the pain points of people in different verticals. When you have founders from different disciplines that can work well together because they went to the same school or worked in the same firm professionally, they can bring complementary skill sets to the table and the chances of them succeeding is much higher.

ZARA ZHANG: As investors, we’re faced with the question of whether to pick the Chinese founders or the local ones. For example, there are two companies doing exactly the same thing. How would you choose between a Chinese team versus a local team?

HANS TUNG: That’s usually a very tough choice. In different categories, whether it’s social networking or gaming or e-commerce, it’s difficult to say which one is better than the other. We have seen successful examples from both camps in each of these categories. When it comes to social networking, it’s easy to generalize and say the local team will understand local markets better. But then you see someone like ByteDance, Toutiao 头条 , and Douyin 抖音 that came out with TikTok 抖音国际版, that’s done very well internationally with a team that’s mostly based in China. Musical.ly is another good example. Musical.ly beat a lot of local teams in the US and Europe with a product that was designed by teams in Shanghai with an LA operation to back it up. So even in social networking where we think that local teams should win, you can see counterexamples.

When it comes to e-commerce in Southeast Asia, Tokopedia is doing well. It competes against Shopee. And a lot of communities are torn as to which one will win out, Tokopedia or Shopee. So even in e-commerce where having the supply chain managed from China should be helpful, you can still see local teams compete effectively. So I think it’s very difficult to generalize which camp is better. It comes down to execution and how fast the founders are willing to learn. I see founders from Tokopedia and Bukalapak spend quite a bit of time in Hangzhou – one was invested by Alibaba and the other by Ant Financial 蚂蚁金服 – to spend time learning things. So I think the key differentiation is not whether it’s a local team or Chinese team, it’s really how fast the teams learn about what they don’t know.

ZARA ZHANG: So what are some examples of successful Chuhai 出海 companies and what do you think was the key to their success?

HANS TUNG: I think the original Chuhai 出海 company that has done well is Huawei 华为 . I think Huawei 华为 is amazing. They have gone from a telecom equipment player to become a consumer-facing handset maker building a global operation. A lot of Chuhai 出海 people that you and I have met came out of Huawei 华为 and ZTE中兴 . You see that they’re well-trained and can do things. Increasingly, when you look in the pure internet space, one has to say that Toutiao 头条 and Douyin 抖音 have done an amazing job with TikTok 抖音国际版. And ByteDance is an impressive company that can expand beyond China. In the e-commerce space, both Shopee and Wish have shown that if you have the ability to understand local markets as well as training in the Chinese supply chain, you can build a very successful business in the e-commerce space as well. I think these are some of the names that people will watch for a long time because they all have what it takes to do something interesting.

Lastly on Xiaomi 小米, I think India has become the fastest-growing market for Xiaomi and they’re number one in India now. To see a Chinese brand do well in a country that, historically, has not been as friendly or open to Chinese ideas is remarkable. And I think that a lot of credit goes to Manu at Xiaomi India who has done an amazing job of building a brand that touches the hearts of hundreds of millions of Indian consumers. How to hire the right GM for that local market and empower them to really localize the way he or she sees fit is an art, not a science. But Xiaomi seems to have cracked the code for India so far.

ZARA ZHANG: In terms of picking markets, we’re seeing a lot of activity in Southeast Asia, India, the Middle East, Latin America, and a little bit of Africa. Each of these markets have different characteristics. India is a huge market, but the middle class is a bit smaller and the ARPU is very low and it’s very competitive. The Middle East has a lot higher ARPU, but the population might be a little bit smaller. So when Chinese founders try to pick a market, what do they need to pay attention to?

HANS TUNG: Different stages require different kinds of companies. For India, the companies from China that do well tend to be the handset makers because that’s the first thing Indian consumers will need to buy to get online. Whether they have a lot of money to spend after they buy the phone or not– it takes time to be able to ramp up disposable income level in order to buy more things beyond their phones. So it happens in stages. For Southeast Asia, the e-commerce market is less competitive compared to India because the American players are not there as much. It’s really Chinese companies competing against the local players, some of which are invested by Chinese companies anyway. It’s interesting. Alibaba owns Lazada and is also an investor in Tokopedia. And Ant Financial, its affiliate, is an investor in Bukalapak. So three of the top e-commerce companies in Indonesia are all Alibaba-related. And it’s just fascinating to see Chinese e-commerce companies doing well in Southeast Asia.

When you look at which markets Chinese companies should go after, I feel that there are enough markets out there where both GDP per capita is high enough and the population base is big enough, and that’s actually Latin America. This is why I think that Didi 滴滴 did the right thing to acquire 99 in Brazil and leverage that platform to grow through Latin America. If you look at Brazil, Rio and Sao Paulo are two of the top three cities for Uber worldwide outside of China. Latin America is actually a market where not as many Americans are willing to go. You see more European-trained executives there. And Chinese companies actually have an advantage of being there if they’re willing to work with local players and local champions.

So Latin America is a market where you don’t see a lot of Chinese companies today. But you will later because the GDP per capita is high enough – in the $7,000-10,000 range – and also the population size is about 600 million plus, with Brazil and Mexico taking half of it. So that’s a market that I think we will hear about more going forward. Right now, going to India, Southeast Asia, and the Middle East is easier from China, so you see teams doing that. But each of these three regions may have its own limitations. And the local teams in Southeast Asia and India are learning so quickly that the advantage that Chinese teams may have is getting less and less. So for the next five years, I still see Southeast Asia, India, and the Middle East as the most popular places for Chinese teams to go, but the upside may not be as high as it could have been five years ago. And I think the upside that people are missing is Latin America.

ZARA ZHANG: And it takes a lot more hours to fly there, so it’s probably more rewarding if you can do it.

HANS TUNG: We did a calculation. It takes anywhere between 26 to 30 hours to go from Beijing to Sao Paulo. It is not an easy trip, so it favors the teams that are willing to make that happen. This is why I admire Didi so much for being able to do that.

ZARA ZHANG: And I think Tencent also invested in Nubank.

HANS TUNG: Yes. They invested in Nubank about a month ago. It’s the biggest investment that a Chinese company has made in Brazil, and in Latin America in general. You’re going to see more China to Latin America initiatives happen, especially given where CFIUS is with the US. It’s very difficult for any Chinese company to go to the US market.

ZARA ZHANG: So, if we talk about the Chinese tech giants, BAT – Baidu 百度, Alibaba 阿里巴巴, Tencent 腾讯 – and the baby giants, TMD – Toutiao 头条, Meituan 美团, and Didi 滴滴- I think we came to the conclusion that ByteDance has the highest chance of becoming a global internet company by offering its own services, not just by investing in others. Do you think that still holds true? I think what they’ve done in India with Helo is very impressive. Helo is their vernacular short video app for non-English speakers in India and has gained a lot of traction lately.

HANS TUNG: I think ByteDance wants to keep a low profile, so I won’t talk about them too much. But what they’re doing is very impressive. I also give Didi a lot of credit for being able to make that acquisition in Brazil and leverage that regionally within Latin America. I think both companies are showing that Chinese companies can expand beyond China, but it just takes a lot of work. Both teams also have a lot of room for improvement and growth by becoming more internationalized and localized in the key regions. I think, in general, the Chinese teams have enough skill set and drive and experience to win internationally. What they lack is the understanding of the local markets and tastes and needs. Japan is a market we haven’t talked about very much, but Toutiao 头条 and TikTok 抖音国际版are doing well in Japan. So over time, as there are more innovations coming out of China, there are even opportunities in markets like Europe and Japan that are more developed.

ZARA ZHANG: To finish off, GGV actively invests in Chinese founders targeting overseas markets, as well as local founders in emerging markets. So if you are an entrepreneur or you have friends who are working on this category, we’re always open for conversations. Hans, do you want to add on to say our investment strategy and thesis in this space?

HANS TUNG: We have offices in San Francisco, Silicon Valley, Beijing, Shanghai, and from early next year, Singapore. That’s five offices. People have asked us whether we’re going to have offices in India or New York or Latin America at some point. We will see. But we definitely have teams that look at all these markets. For us, we have investment theses around four buckets. That’s commerce and new retail, internet services including social networking, on-demand services, and O2O services like transportation and so forth. The third bucket is enterprise. And the fourth bucket is deep tech, frontier tech. In any of these four buckets, we’re actively looking for investments across these regions because we see similarities in information arbitrage and knowledge-sharing that our team can bring. So if you have any interest, feel free to contact Zara or myself on WeChat.

ZARA ZHANG: We talked about how founders should try to meet other people of different backgrounds and skill sets. One way of doing that is to join our 996 meetups across different parts of the world. You can join the communities at 996.ggvc.com/community and all of our events and meetups will be posted there. We’re looking to host a lot more in other parts of the world like Southeast Asia and India going forward. Thank you for listening.

HANS TUNG: Thank you.

Thanks for listening to this episode of 996.

ZARA ZHANG: GGV Capital is a multi-stage venture capital firm based in Silicon Valley, Shanghai and Beijing. We have been partnering with leading technology entrepreneurs for the past 18 years from Seed to pre-IPO. With $6.2 billion in capital under management across 13 funds, GGV invests in consumer new retail, social, digital internet, enterprise cloud and frontier tech.

GGV has invested in over 290 companies with more than 45 companies valued at over $1 billion. Portfolio companies include Airbnb 爱彼迎, Alibaba 阿里巴巴, Ctrip 携程, Didi Chuxing 滴滴出行, DOMO, HashiCorp, Hellobike 哈啰出行, Houzz, Keep, Slack, Square, Toutiao 字节跳动, Wish, Xiaohongshu 小红书, YY and others. Find out more at ggvc.com.

We also highly recommend joining our listeners’ WeChat group and Slack channel where we regularly share insights, events and job opportunities related to tech in China. Join these groups at 996.ggvc.com/community.

HANS TUNG: If you have any feedback on this podcast or would like to recommend a guest, please email us at 996@ggvc.com.

Episode 27: George Yan: From Microsoft China to Clobotics

GGV Capital’s Hans Tung and Zara Zhang interview George Yan (严治庆), the founder and CEO of Clobotics, (扩博智能). Founded in 2016, Clobotics is a computer vision startup that seeks to make traditional industries more intelligent. It is headquartered in Shanghai and Seattle with offices in Beijing, Dalian, and Singapore. It currently serves two industries: traditional retail and wind energy. Clobotics owns over 40 patents and has raised $21 million in VC funding. GGV was an early investor in Clobotics in 2017, and our managing partner Jenny Lee is on the board. 

Prior to founding Clobotics, George spent 16 years at Microsoft in the US and in China. As the vice president and general manager of marketing and operations for Microsoft Greater China, he contributed to the double-digit growth for the region’s $3 billion business. He was also responsible for the inception of Microsoft Cloud business in China, and led a massive team in landing Microsoft Azure and Office365 in China within less than 10 months, making Microsoft the first world-wide cloud service provider to land its service in mainland China. Before Microsoft, George worked at Goldman Sachs and McKinsey in the US. He holds a master’s degree in financial engineering from Columbia.

George discussed how to find the “right timing” to leave big tech companies to become entrepreneurs, the lessons he drew from helping Microsoft land in China, and what it’s like to run a startup that is global from Day One.


ZARA ZHANG: Hi everyone. If you will be in Las Vegas for CES, the Consumer Electronics Show, on January 8th, we would like to invite you to the 996 CES meetup. Join GGV Capital, our co-host ZhenFund, global founders, and world class leaders for an evening of cross-border networking, insights, and fun. Our managing partner Hans Tung will have a fireside chat with exclusive VIP guests you won’t want to miss. For more details and to register for the event, please visit ces.ggvc.com. And this is a reminder that all of our events and meetups are announced in our 996 WeChat groups and Slack community. I highly recommend joining these groups by visiting 996.ggvc.com/community.

HANS TUNG: Hi there. Welcome to the 996 Podcast, brought to you by GGV Capital. On this show, we interview movers and shakers of China’s tech industry, as well as tech leaders who have a US-China cross-border perspective. My name’s Hans Tung. I am the managing partner at GGV Capital, and I have been working at startups and investing in them in both the US and China for the past 20 years.

ZARA ZHANG: My name is Zara Zhang. I’m an investment analyst at GGV Capital and a former journalist. Why is this show called 996? 9-9-6 is the work schedule that many Chinese founders have organically adopted. That is, 9 a.m. to 9 p.m., 6 days a week.

HANS TUNG: To us, 996 captures the intensity, drive, and speed of Chinese Internet companies, many of which are moving faster than even their American counterparts.

ZARA ZHANG: On the show today we have George Yan, or Yan Zhiqing 严治庆 in Chinese, who is the founder and CEO of Clobotics, or KuoBo ZhiNeng 扩博智能 in Chinese. Founded in 2016, Clobotics is a computer vision startup that seeks to make traditional industries more intelligent. It’s headquartered in Shanghai and Seattle with offices in Beijing, Dalian, and Singapore. It currently serves two industries, traditional retail and wind energy. Clobotics owns over 40 patents and has raised $21 million in VC funding. GGV was an early investor in 2017, and our managing partner Jenny Lee is on the board.

HANS TUNG: Prior to founding Clobotics, George spent 16 years at Microsoft in the US and China. As the Vice President and General Manager of Marketing and Operations for Microsoft Greater China, he contributed to the double-digit growth for the region’s $3 billion a year business. Jenny and I have known him for over 10 years. He has also been responsible for the inception of Microsoft cloud business in China and led a massive team in landing Microsoft Azure and Office 365 in China in less than 10 months, making Microsoft the first worldwide cloud service provider to land its service in mainland China. Before Microsoft, George worked at Goldman Sachs and McKinsey in the US. He holds a master’s degree in financial engineering from Columbia. Welcome to the show, George.

GEORGE YAN: Thank you. Thank you, guys.

ZARA ZHANG: The majority of your career was spent at Microsoft. What was it like to help a US company run its China operations? And what lessons did you learn about how US companies can go to China?

GEORGE YAN: It was a great experience running the Greater China team. Basically, I’m an engineer and I was born an engineer, so having that engineer discipline and attention to details and the logic to apply to a business world, I found myself able to transition into that role pretty naturally. But the business is so vast for Microsoft. The portfolio extends from the consumer business to hardware to services to cloud to licensing etc., and that gave me a great view of all aspects of the business, as well as how we would need to tweak different knobs to make each one of the businesses successful. So I found that that type of experience was super helpful to lay the ground for me to jump into the startup world.

ZARA ZHANG: I wanted to dive into the details. How did you manage to launch Microsoft Azure and Office 365 in China within such a short period of time? And how did you deal with the regulatory challenges?

GEORGE YAN: I think with a lot of luck to be honest. It’s understanding the Microsoft ecosystem, the business, the technology behind it. By spending a lot of time on the engineering team in the US, I vastly understood how an engineering product needs to shape itself to be here in China. And spending more than 10 years in China, I have a good feel for what the government and the regulators are looking at when a multinational like Microsoft wants to land a service in China. Also, that was the right timing for China getting a lot of weight behind the cloud, and the infrastructure of the internet booming, and wanting to have a multinational cloud provider here to be in the playing field. So I think we were lucky that we were at the right time, the right place, with the right people, and able to be very level-headed with the government about what it takes and how we would need to shape our technology and change our features and write our code differently in order for the product to be localized and able to operate here in China.

ZARA ZHANG: So could you talk about Clobotics? Just give our listeners an overview of how it’s helping to transform traditional industries.

GEORGE YAN: Sure. On the retail side, we’re focusing on digitized products. We think that offline retail today is unfairly challenged because it’s really hard to connect the people with a product in the retail store. And how would you connect those dots through the product in the middle? Recognizing the product is a very hard problem because, at any given time, there are hundreds of millions of different products out there in the market. So how can a person recognize their product so that they can have the interaction that you have so naturally online but don’t have offline? We believe that’s the problem that we want to solve. Digitizing the physical world starting with retail products. And once you do that and once you can build customer interaction building to business interaction with a product, then you have a very different model for how offline retail generates their revenues going forward.

ZARA ZHANG: So what does your product look like in the store and who uses it?

GEORGE YAN: If you were to go into a Walmart store or even a mom-and-pop store in Xi’an, likely when you open up a Coca-Cola fridge, you will see our IoT device stuck on the door. Basically, it’s two cameras looking in so they will understand what products have been taken out of the shelf. And we do local processing on the edge. So there’s a small on the edge chip that does deep learning algorithms to recognize what products been taken. Only the bits that change get sent back to the cloud, but at the headquarters, you’re able to see all the product movements in over a million or a million and a half coolers out in the market. So, basically, giving the headquarters that transparency and that view into how these point of sales devices are working at real time.

HANS TUNG: Traditional retail and wind energy are two very different markets. What’s the commonality between the two that allows you to build a product that can service both? And at some point in the future, do you have to choose which one to focus on more?

GEORGE YAN: That’s a very good question. That’s the question that keeps me awake at night. Essentially, when we got into this business, we saw that the fundamental technology blocks are the same. It’s going to be hardware, it’s going to involve some type of software, it’s going to involve computer vision, it’s going to involve automation. And we fundamentally believe that these technologies should be applicable in very different industries. We went into wind energy first because we had backgrounds in drones, in hardware, and also in computer vision. So entry into that space gave us that natural barrier and the acceleration that we needed to be number one in the market.

So, after two years in this industry, we shipped our first product, and we’re already the China leader in doing autonomous inspection for the wind turbine industry. When we look at the second industry, we see that the retail industry is a trillion dollar industry with still very little technology. And we believe that if we can provide the technology for the offline retailers and the CPG companies, they will use that as tools and weapons to actually have a fair fight against the guys like Amazon, etc. So we want to see how this industry will get shaped in the future, but that takes a longer time. And in order for us to be there when that battle happens, we’ve got to make sure that we can survive on this revenue stream and be a leader in certain spaces that we are sure of. So we look at wind turbine as more of a defensive play. We look at the retail space as an offensive acceleration play for the long term.

ZARA ZHANG: So what kind of industries will you go into next?

GEORGE YAN: We have plenty of things on our plate for us to chew. Our goal is to be number one in those two fields, and I think it’s going to be a while before we can pat ourselves on the back and say we are. So we’re not looking at a third industry. Our strategy is to have a defensive play and an offensive play, and that’s already complete. And we just have to go super deep in these areas to see how we can help these enterprises to extrapolate better value and better productivity from it.

HANS TUNG: Do the wind energy companies have more money to pay you?

GEORGE YAN: They do have a pretty significant budget for the operations and maintenance area. This is actually a $25-billion market, and there’s 450,000 turbines worldwide. So if you do the math, that averages out to $65,000 that they spend on operations and maintenance alone per turbine per year. And today, we’re only scratching the surface. We’re only getting $300 out of that $65,000 that they’re spending. So there’s a lot of technology innovations that we can do to make sure that we get a larger pie. And also the pie itself will get bigger as the technology innovations happen in the wind turbine industry.

HANS TUNG: So what’s preventing you from just focusing on that first?

GEORGE YAN: Again, it takes time for a commercial business to really accelerate. And for us to do that part well, we have already taken the right set of groups to be able to churn and move forward. This is not a game where if you have 10 people, you can go to 10 turbines, and if you have 100 people, it’s 100 turbines. It’s actually just that core set of people that’s churning at the customer sites and fixing bugs and improving products etc. So we’re not increasing the team. We’re just accelerating and making sure the product gets better. And that time is not going to go away by adding people. So for us, we know the trajectory is there and we will have to go deeper. By going in deeper, we’ll just have to take that time.

ZARA ZHANG: Could you talk a little bit about your technology and how it’s differentiated from other solutions?

GEORGE YAN: The requirement for our technology on the retail side is scale. Anybody today can take 10 or 20 pictures, do some labelling, put it into an auto ML engine from a large company, and turn out a fairly decent model that can get 90% or 95% accuracy. But that’s not interesting. It’s great for a demo, but it doesn’t work in a real environment. We’re talking about millions of products that we have to recognize. And on a weekly basis, there are hundreds and thousands of products that get updated, so new things that you have to recognize. So the platform that you provide to capture those images, label those images, find the SKUs that you’re looking for, then building the models and pushing the models in a very small form factor, into IoT and into your devices, that’s our bread and butter. And that’s something that’s really hard to chase or to leapfrog. I always use an example of the things that we previously did at Microsoft. During the search war, we always thought that with more money, with more hours, with more talent, we’d be able to catch up with Google. But we found that that was not the case because that was a data game. They were in the market first.

HANS TUNG: They had a lot more data than you.

GEORGE YAN: Exactly. So it doesn’t matter how much talent and how many hours you add onto it.

HANS TUNG: Right. You’ve got to have the data to train your algorithm.

GEORGE YAN: Exactly. So we believe for us today, we saw this big problem and we’re in there first. We’re capturing data. We’re building better algorithms around it. That gives a first mover advantage for us to scale many, many, many years later on.

ZARA ZHANG: Clobotics is only around two years old, but it already has offices in five cities across three countries. Why do you want your business to be global from day one?

GEORGE YAN: It’s all about talent. I think that talent from multiple different backgrounds coming together will come up with sparks, and these are the insights that I want when we build the team together. And by running global development teams for Microsoft for many, many years, that’s just part of our DNA. And that gives that “unfair advantage” of having the best people in the US and in Asia and in China etc. all coming together and working on the pieces that they’re good at. And today, machine learning, AI in general, is a super hot market, so being able to tap into other markets that haven’t been washed through multiple times gives us an advantage, from a resource and economic perspective, over some of the competitors as well.

ZARA ZHANG: Speaking of talent, you guys have a killer engineering team. Around a quarter of them hold a PhD degree, and over 80% of the team overall has a master’s degree or higher. Many team members come from prestigious Silicon Valley companies like Microsoft, Google, Amazon, Facebook etc. What tips do you have for recruiting technical talent in China? And when you pitch Clobotics to these talents, what do you use to convince them?

GEORGE YAN: I sell them our Clobotics dream but in Chinese, so they understand that we’re about staying here but we can also go global. And the dream has to resonate. I tell the person to close their eyes and imagine the offline retail industry five years from now. If a person walks into a store and the store is no longer aisles after aisles and racks after racks, it’s more of an experience play. When you put on your AR glasses or when you look through your mobile phone, that table in front of you with multiple products now suddenly starts talking to you, starts giving you more information, starts to tell you that there’s alternative products that you can get as well. And by clicking it, you’re getting more personalized information or personal discounts. That’s where I see the offline retail space going. Does that person want to be part of that journey? Does that person want to tell their son and daughter that their father or mother was part of that journey, was part of the mission that changed how the retail industry worked? We believe that if that resonates with a candidate, then more than likely I’m going to get that candidate to join us.

HANS TUNG: In my almost 20-year career in VC, I’ve met many professionals with amazing backgrounds in multinational firms for a long time. Most of them who work in the US tend to stay in the US. And the ones working in China tend to stay in MNCs for a long time as well. So when you and your co-founders, who come from being in multinationals for such a long time, came to do a start up, what changed for you? What was the thing that switched for you to decide to take that risk after all these years? And then, as you start building a company — you’re no longer part of Microsoft, no longer part of a big company; now you have to sell yourself and build your own brand — what are the lessons, both on the positive and negative side, that you can share that will be helpful to our audience?

GEORGE YAN: I think the most important takeaway through my two and a half years in the startup world is I started to recognize that I know nothing. And that’s super, super key for a person to be able to face themselves and admit that you know nothing. If you’re a large fish in a small pond, you get into a position where you think that you know everything. You can execute, you can do anything with your eyes closed. And that’s no longer interesting. So get yourself out of that comfort zone into a newer space because there’s a bigger world out there.

HANS TUNG: But a lot of people don’t want to do that. They enjoy being a cog in the machine at a multinational firm where they know exactly what to do and get paid well doing it. What changed for you and your co-founders?

GEORGE YAN: I think we’re just built differently. There’s going to be lots of these people that are built differently. If you look at the CEO, same thing, right? I think it just takes a special breed of people that become CEOs. Not everybody is fit for that role and we’re okay with that. We recruit a lot of people from multinationals and sometimes they say, “You know what? I like my comfort zone. I’m going to stay there.” That’s totally cool. But out of 10 people you talk to, you’re going to find one or two people that have that spark. All you’ve got to do is give them that nudge and they’re going to leave that comfort zone and join us. And the experience that they get in the next two or three years is going to be totally different. It’s an eye-opening experience for that person, I guarantee it.

HANS TUNG: Any specific incident you can recall that changed for you personally?

GEORGE YAN: Yeah. It was actually at the GGV LP event four years ago. I was sitting at the back table looking up at the startup CEOs giving speeches. Some of those guys are great at articulating their mission. Others not so good. But you can feel the passion that they have in the way that they’re telling the story. And I looked deep down into myself and said, “Okay. Am I just going to be a person who has a fast track to the C-Suite in a large company? Or do I want to do something bigger?” And when I said that to myself, I felt like I also had a mission. I also had a vision where I could digitize the physical world. I’m willing to converge the two together. And I have the talent, I have the tools, I have the people, I have the support, I have the worldview to make that happen. So why not take the plunge and try it?

HANS TUNG: That’s a good tip. For our next annual meeting, we’ll make sure we have the future George Yans and the Claire Chens of the world come to our event and be motivated.

ZARA ZHANG: What was your biggest challenge once you came out of a big company and started to pitch yourself? What kind of challenges did you face?

GEORGE YAN: I think it’s about being able to recognize that now without the big brand, without the reputation, people are going to look at you a little bit different. You have to be okay with that. The pride or the extra accessories that you had with a large company, all that stuff goes away. Today you have to build that reputation. You have to use both your hands, roll up your sleeves with your co-founder and do it from the ground up. And that realization was a shock to me. When you’re going to places where people roll out the red carpet for you, you have time scheduled for you etc., and everything now you have to do it on your own. That shock took five seconds. After that you know that you’re in a different place, the battlefield’s different, the things you do have to be different. The agility of adjusting yourself for the new environment, I think any startup CEO needs to have that and have it quickly.

ZARA ZHANG: You have so many offices across so many geographies. How do you divide up responsibilities across them and how do you minimize the communication costs?

GEORGE YAN: We try to build these themes, a group of folks that are deep in certain areas. And we try to hire around the leaders. For example, the head of our US office is a renowned computer vision scientist and has been in the startup world as a CTO. So we build computer vision capabilities around him. And you can see that, because he has gone down the path previously, the senior talents and the junior talents and also the fresh hires and the interns can all start to come together in that area. So we’ve become this pot of folks who are very deep in certain areas. If you look at our China infrastructure team, these guys are ex-startup or ex-Internet guys, so they know how to quickly roll out a platform and scale to millions and millions of services over a very short time. So we try to go where the talent is and try to hire around where that talent pool has the right DNA and build from there.

HANS TUNG: You have had exposure to both B2B and B2C business models. When you guys were thinking about Clobotics, what made you decide to do this model that’s 2B in nature?

GEORGE YAN: I think in China, the previous internet or mobile internet etc. has been a rush of consumerization of online spaces. And, to be honest, that’s not something I’m very good at. It’s not in my DNA. I’ve been on the enterprise field for all of my career and I keep on watching and waiting. I believe the next wave of change is going to happen on the B2B side. And it’s going to happen with deep technology companies that can help push the business model, working with the traditional industries to help them transform. That’s where my bread and butter is at. You’ve got to do something that you’re good at in a place where all the cards are stacked against you, so we’ve got to find the things that we’re most comfortable with. It’s global, it’s deep technical, and it’s able to scale into services that other people can’t.

HANS TUNG: Knowing what you know now, when you look back at your career in Microsoft, what things do you think you learned that help you do what you are doing today? And what skill sets do you wish you had learned, either on your own or through elsewhere, that would have better prepared you for the role you have now?

GEORGE YAN: That’s a very good question. We were just talking about that in the team yesterday. I spent 12 years on the Microsoft engineering team. I believe I spent a little bit too long of a time there. I would cut down to about eight years so that I learned how to build a product a couple of times and how to scale a product. And I would leave the last four years to go to a company like Alibaba. Because I believe in the earlier days of Alibaba, the agility for you to change, the ability for the pressure to be on a person to deliver, and then to be versatile enough to be in different roles, that type of pressure is what I’m experiencing today. And I’m learning from scratch. But if I had that company where everybody had similar values and everybody had a similar movement, I believe that I’d be more prepared, that I would have a better preparation for where I’m at today.

HANS TUNG: That’s very good advice for our audience. Thank you.

ZARA ZHANG: What advice do you give to entrepreneurs who are debating whether they should train at a big company first or just jump straight into starting a company?

GEORGE YAN: Just from my personal experience, I think that training in large companies— I look at Microsoft as Huangpu Junxiao 黄埔军校. This is a place where you can move into multiple roles. I started as a engineer, then I was in product management, then I ran a large engineering team, then I came to China, then I ran the China business. So large organizations are able to give you these multiple roles and you can excel in these roles. And if you think about it, it’s actually very low risk. You really don’t have much to lose by trying new things in large companies. You don’t have to worry about these 70, 80 people that are with you. You don’t have to be worried about their paychecks. It’s basically a free trial that you try to get as much out of as you can while in these companies. And you’ve got to tell yourself that once you’re ready, jump. Even if you think that you’re almost ready, jump. Because you’re going to have great VCs like GGV and Hans that can back you and help you to really close the last mile, to get you out of that door. Everybody needs a kick-in. And my kick-in is sitting at the GGV event. And sometimes you just have to look straight into Hans’ eyes and Hans says, “Go.”

HANS TUNG: Or Jenny’s.

ZARA ZHANG: How did you know it was the right moment for you after spending so many years?

GEORGE YAN: It’s actually an evolution. It’s not a revolution. I’ve been preparing this thing for the three years, as I was talking about. I believe that the market, the technology, and my experience is now at the place where I think I’m ready. So it just becomes a natural progression of where I want to take my career next with the people that I enjoy working with the most.

ZARA ZHANG: So when you left Microsoft, did a lot of people come with you to join your new venture?

GEORGE YAN: For the record, no. I think you’ve got to have your own road. Once I’m on that road, once I’m telling people my vision, there’s other people, whether it’s in Microsoft or other places, who knew my reputation in the industry and decided that they want to share that dream with me. So everybody has to take their own path and it’s going to be a different timeframe. We welcome anybody from multiple backgrounds who share the same dream to come in at any time during the journey to be with us.

HANS TUNG: I think your advice to get people who are working at big companies to take risks is very important. A lot people think going to a big company is where they’re going to end up and stay. So they’re actually afraid of taking risk, of losing their job. But if you view it as a training ground, battlefield practice sessions, you can actually learn a lot if you approach it with a different mentality and mindset.

GEORGE YAN: Exactly.

ZARA ZHANG: You have served a variety of roles in your careers, first joining the engineering side, and then going to the operational side, and now CEO. Could you talk about your takeaways from these various roles?

GEORGE YAN: These roles are different, but your fundamental principles and how you approach and solve a problem are the same. Coming from a technical background, you’re always very logically trying to dissect a problem into multiple areas, and doing tradeoffs, and making sure the logic supplies the decision-making process. I think that’s just built into me. And I’ve been trying to apply the same skill sets whether I’m in an engineering role or running a product or coming to China. But I quickly found out that in a startup world, it’s not always the case. Therefore I actually have a circle of ex-CEOs, or even CEOs that are currently serving today in companies that are smaller than me or bigger than me, that I talk to on a daily basis. We bounce ideas off each other to make sure that I don’t get blindsided by things that I’ve been avoiding or overlooked. I think that’s critical. Again, recognizing that you don’t know anything and building a vast support system around you for those guys to give you ideas and advice and even just challenge your strategy and decision-making process. I found that to be very, very helpful.

HANS TUNG: As you were assembling your co-founding team, how did you think about who to recruit and what role they should be playing on your team? And how do you complement each other?

GEORGE YAN: I actually didn’t do any recruiting. Most of us had worked together for the past eight to ten years, so we knew each other well. We knew that once this co-founding team came together, we’d have a good chance of achieving something great. So it was a natural progression. And once you took the first step, everybody said, “We want to take the same step.” So it was a very natural path to get there. I think that’s probably one of the benefits for an older person like us, that we have that experience in large companies. So you have a track record. And a track record means a lot. So the advice I would give to the younger guys is make sure that you really cherish your reputation and your track record, whatever you do. Because all that stuff is going to add up and build who you are going to be later on.

ZARA ZHANG: You run a cross-border company across the US and China. How do you deal with the cultural differences and the communication costs? And how do you make sure everyone stays on the same page when you have such a diverse team?

GEORGE YAN: Write it down. A lot of times, by talking, things get missed. A person who’s not there gets missed. By passing words back and forth, things get missed. But once you write it down, it’s on paper. And you quickly realize that when you write things down, you actually have even more structured thoughts. Even things that you thought made sense don’t make sense on paper. So you actually spend more time tweaking it and doing more to make sure the ideas are solid. So we have a writing culture. We use Microsoft OneNote so everybody can contribute to the same service and we can see how our ideas progress over time. Writing it down is the top tool that I would recommend for everybody to do.

ZARA ZHANG: Do you think people work the same hours across your different offices or do you see a difference?

GEORGE YAN: Wow, the questions are getting harder. I think the hours are different, but people are constantly thinking about the problem that we’re solving. We don’t have office hours and we don’t have punch cards. We don’t track how long or how short people work. But you can see through the activities, whether it’s on WeChat or it’s on WhatsApp or on email, you know that people are constantly trying to solve a problem. And the problem’s not going to go away. So whenever you feel like you’re rested, whenever you feel like you’re ready, whenever you feel like the timing’s right, people will jump in. Because a startup is a self-motivating and self-driven service. It’s not just a paycheck. The paycheck that we give them today, any of these guys can walk out of here and go to a com company and get 2X and 3X pay. They’re not here for that. They’re here for that vision. So the faster that we can achieve that, the better prepared we can get, the better it is.

HANS TUNG: How many people do you have in the US now?

GEORGE YAN: We have 12 people in the US. A lot of those guys are pretty senior, very seasoned guys. And, to be honest, those guys also have less financial burdens as well. So these guys, if they believe in your vision and they want to spend time there, the amount of productivity that they come out with is just going to be enormous. It’s going to be super cool.

HANS TUNG: And how many people do you have in China?

GEORGE YAN: We have over 60 people in China. It’s spread over sales, marketing, operations, and engineering. That’s the big piece of it.

HANS TUNG: So what we have seen so far is that some of the engineers in China tend to want to just get going and start building stuff and then reset if it doesn’t work, get feedback from the users and iterate again. The architects in the US, in general, show some tendency to plan, get in sync, test the product before they roll out. It’s more deliberate. How do you reconcile their differences so they can be cohesive and productive for you?

GEORGE YAN: It’s a very good question. We have something called the prototype gurus. The prototype gurus basically help people to really put together that vision. People can see what that looks like six, ten months down the road. But also, we’re fortunate that our business is a scale business. It’s not something that you can just write and give it out and the customer gives you feedback. You can do that today. But how do you scale that service? It’s all about deep engineering, infrastructure work. And that part actually is going to take time. And this is where the US, the guys with a lot of experience, even our CTO who has done this for Bing search, comes in, so the infrastructure that we build today can scale to millions and millions of SKUs that we have to recognize. And our customers are multinational customers, so their expectation of our services, our SLAs, are super high. When customers are putting heat on you to say, “The stuff that you give us—”

HANS TUNG: Better work.

GEORGE YAN: “Better work. You’d better make it work.” That pressure gets on and we want to do the right thing, so we don’t want to waste engineering resources to rebuild and re-architecture. So that culture, fortunately, is very fitting to our background and business.

ZARA ZHANG: What advice do you have for US tech companies who are thinking about entering the Chinese market?

GEORGE YAN: It’s going to be challenging, to be honest. And I can tell you the multinationals haven’t even figured that out yet. It does take a special breed of people who not only look Chinese but understand the China environment, understand the local culture here, know how the US operation works and are able to learn and quickly adapt to the local environment here. It takes a special person or a special group of people to deliver that here. So take your time entering China. It’s not a place where you stick a flag and say, “We’re in China.” You’re going to get slaughtered. So take your time, find the right talent, even groom the talent if you have to. But this is a three- to five-year journey. And, by the way, if somebody finds a secret formula, you should sell that to Microsoft or Amazon or anybody else because they haven’t really figured this out yet.

HANS TUNG: You went through this with Microsoft. Knowing what you know now, what would you have recommended the management team do differently to be more successful in China, whether it’s on the enterprise side or on the consumer side with MSN Messaging?

GEORGE YAN: Ouch! I think on the consumer side, the timing wasn’t right. The team had a different agenda. It was a different DNA. So that part was not going to happen either way. But on the enterprise side, if a large corporation would truly carve out an engineering team dedicated for China and make that China leader responsible not only for sales and marketing, but for engineering, for research, for investment. You make that a true CEO for China, I believe the dynamics will be very different. And that’s still something that none of the multinational CEOs are willing to take a bet on.

HANS TUNG: Maybe except KFC.

GEORGE YAN: Through a joint venture.

HANS TUNG: What kind of person would have succeeded as a Microsoft China CEO in charge of the entire operation including engineering and product? If you were sitting in Redmond and you had to pick someone to be the first Microsoft China CEO, what would he or she look like in terms of background and temperament?

GEORGE YAN: I think I’m a very good choice.

HANS TUNG: But what is it about you that Redmond should have seen?

GEORGE YAN: It’s the things I was saying previously. They need to understand the product, spend a lot of time in corporate, understand how business is run in China, understand the intricacies of government and also regulation policies. But I think when I left Microsoft, even if I was given the role, I wasn’t ready. But having gone through two or three years in the startup world, I feel I’ve learned so much and seen so many things on the ground level, I would say that I’m much better prepared than I was four years ago.

HANS TUNG: Interesting. So you’ve got to have both.

GEORGE YAN: Exactly.

ZARA ZHANG: So now we’ll jump to the final part of the interview which is a round of rapid-fire questions. The first one is who is an entrepreneur you admire the most and why?

GEORGE YAN: I’ll give you two. Chairman Mao and George Washington.

HANS TUNG: Be controversial. Okay, go for it.

GEORGE YAN: Look, I think Chairman Mao is a great entrepreneur. He had a great ideology. He had, I would say, mediocre people. He had very few tools. And he’s able to attack this area he believed in and turn it around and use whatever resources it took in the long game to create what China looks like today. I think that entrepreneur spirit, if you read his writing, it’s always a part of his DNA, his genes. So I respect a person for being able to take that plunge. We’re changing an industry. He changed the world. And similarly with George Washington. When he comes in and says, “Hey. We’re going to do something great.” Again, a great ideology, but very mediocre people, very few tools, all the cards stacked against him. But he took the long road and built what is the United States of America today. I’m a history buff, so when I read these things about how they were able to conquer these difficulties, it makes me think that the things I’m doing are not too difficult.

ZARA ZHANG: What’s a book or article that you read recently that you recommend?

GEORGE YAN: I keep on recommending Principles. Principles is a great book because you basically distill all of these learnings, all of these things that you say, “I wish that I could write those things down.” He wrote it down. He was able to put it together in a book and share it with you. So this is not a book that you read once and put on a bookshelf. This is something that you should carry with you all the time and just flip through the chapters. And there’s going to be these aha moments in these chapters where you say, “If I took a different path, if I’d looked at a person differently, if I knew that person’s background, I might behave a little bit differently and talk to that person differently.” All these things are so resonating and so useful. It’s something that should be pocket book sized and carried by all CEOs all the time.

HANS TUNG: So what do you think about when you get up in the morning? What motivates you to get up in the morning every day? And also, what are the things that keep you awake at night?

GEORGE YAN: The thing that motivates me is that today, 80-something people and some time later it will be hundreds or thousands of people that share the same vision and want to help traditional enterprises to digitize the physical world. And if that dream spreads around, I believe that not only will the world be very different than what we see today, but the wave of changes that we’re going to experience is going to be bigger than the internet wave. It’s going to be bigger than the mobile internet wave. It’s going to be bigger than the cloud wave that we have seen. Digitizing the physical world is the ultimate game where you bring all the talents and all the resources together to shape how we are going to see things differently five to ten years from now.

HANS TUNG: And what keeps you up at night?

GEORGE YAN: It’s going to take a long time to get there. And I need to have the right talent, the right resource, the right customers, the right product to serve the customer. It all comes together to make that happen. It’s a long journey. So I need GGV and the likes to back me up and make sure that we all can achieve that dream together.

HANS TUNG: We’re happy to.

ZARA ZHANG: What types of roles are you hiring for and how can people reach out if they’re interested?

GEORGE YAN: I think in a startup, people define their role. I actually don’t have very clear job descriptions. I have engineers. I’ve sales marketing guys. I’ve operations guys. And when a person comes in, they look at what we’re doing, and they tell me how the job description should be built. That’s how it should work. If you’re looking at a job description, I can get you on www.microsoft.com. There’s a whole bunch of jobs listed there. You can find one for your suiting.

HANS TUNG: So last question: what you do for fun? I know you don’t have much time for fun these days, but I still ask the question.

GEORGE YAN: I’m a saltwater aquarium fanatic. I have a saltwater tank at home. It’s an ecosystem on its own. It has LPS, SPS, it has live corals, it has Nemo. All the things that you can imagine in the sea, I have in my tank. And it’s delicate because you’re basically shrinking the sea into your living room. And the right chemical balance and the right tweaks that you have, the right bells and whistles, alerts to make sure the potassium and calcium are all correct and the right levels, that’s my chemistry lab. That’s something that I can focus on to take my mind off what I do in the startup world. It calms me down. When you look at the fish swimming in the water, you see the starfish and you see the corals waving back and forth, that gets me into a different environment where I can distill, and think, and process, and be better prepared for tomorrow.

HANS TUNG: What were your working hours at Microsoft and what are your working hours now?

GEORGE YAN: I would say the working hours are not different. Microsoft, for me at least, was my own entrepreneur experience. If you look at me coming into China as the first person working on MSN, if you look at me going from engineering to sales marketing, working on cloud which Microsoft or any other company hadn’t done before, jumping into the CEO role, no one had done it before. All these things, I’m taking that as an entrepreneur experience. Just trying it without a lot of risks. So the hours I put in were not your regular hours. I worked six days a week. Whenever there’s a customer call, I’m there. I spent all the time with the sellers going to a customer to see how we would close the deal, how we would structure a deal, how we would get government on our side etc. I looked at it as experience. So that experience continues into the startup world.

HANS TUNG: Except now you work seven days a week.

GEORGE YAN: Exactly. And with more risk. And I need to be more careful because we’re playing with your money and our own money.

ZARA ZHANG: George, thank you so much for being on our show.

GEORGE YAN: Thank you. Thank you for inviting me. Thank you. Take care.

HANS TUNG: Thanks for listening to this episode of 996.

ZARA ZHANG: GGV Capital is a multi-stage venture capital firm based in Silicon Valley, Shanghai, and Beijing. We have been partnering with leading technology entrepreneurs for the past 18 years, from seed to pre-IPO, with $6.2 billion in capital under management across 13 funds. GGV invests in consumer new retail, social Internet, enterprise cloud, and frontier tech.

GGV has invested in over 290 companies with more than 45 companies valued at over $1 billion. Portfolio companies include Airbnb, Alibaba, Ctrip, Didi Chuxing, Domo, Hashicorp, Hellobike, Houzz, Keep, Slack, Square, Toutiao, Wish, Xiaohongshu, YY, and others. Find out more at ggvc.com.

We also highly recommend joining our listeners WeChat group and Slack channel, where we regularly share insights, events, and job opportunities related to tech in China. Join these groups at 996.ggvc.com/community.

HANS TUNG: If you have any feedback on this podcast, or would like to recommend a guest, please email us at 996@ggvc.com.

Episode 26: Yan Li and Token Hu of NIU on the Journey to IPO

GGV Capital’s Hans Tung and Zara Zhang interview Yan Li and Token Hu, the co-founders of NIU, or 牛电科技 (a.k.a 小牛电动车) in Chinese. NIU designs and manufactures smart and high-performance electric scooters. It is currently the largest lithium-ion battery-powered e-scooters company in China and a leader in Europe in terms of sales volume in 2017. As of June 30, 2018, NIU had sold more than 430,000 smart e-scooters in China, Europe and other countries.

NIU’s vision is to become the number one brand for urban mobility, powered by design and technology. Before NIU, smart electric two-wheeled vehicles did not exist in China, and two-wheeled vehicles were perceived low-end. The company has changed that perception with their smart e-scooters and premium brand.

NIU just went public on the NASDAQ in mid-October. GGV led NIU’s series A back in 2015 and has backed the company in every round since then, all the way through its IPO. Our managing partner Jenny Lee is on the board. We are very excited to have Yan and Token with us on this episode, almost fresh off the plane from New York.

Yan and Token discussed how NIU became a lifestyle brand in China, the ups and downs during their amazing startup journey, and what it was like to take a Chinese company public on the NASDAQ.


HANS TUNG: Hi there. Welcome to the 996 Podcast, brought to you by GGV Capital. On this show, we interview movers and shakers of China’s tech industry, as well as tech leaders who have a U.S.-China cross-border perspective. My name’s Hans Tung. I am the managing partner at GGV Capital, and I have been working at startups and investing in them in both the U.S. and China for the past 20 years.

ZARA ZHANG: My name is Zara Zhang. I’m an investment analyst at GGV Capital and a former journalist. Why is this show called 996? 9-9-6 is the work schedule that many Chinese founders have organically adopted. That is, 9 a.m. to 9 p.m., 6 days a week.

HANS TUNG: To us, 996 captures the intensity, drive, and speed of Chinese Internet companies, many of which are moving faster than even their American counterparts.

On the show today, we are extremely excited to have Yan Li and Token, co-founders of NIU, or NiuDianKeJi (牛电科技) in Chinese, on our show. NIU designs and manufactures smart and high performance electric scooters. It is currently the largest Lithium-ion battery-powered e-scooter company in China, and a leader in Europe as well in terms of sales volume in 2017. As of June 30 this year, NIU had sold more than 430,000 smart e-scooters in China, Europe, and other countries around the world.

ZARA ZHANG: NIU’s vision is to become the number one brand for urban mobility, powered by design and technology. Before NIU, smart, electric two-wheeled vehicles didn’t exist in China, and two-wheeled vehicles were perceived as low end. The company has changed that perception with their smart e-scooters and premium brand.

HANS TUNG: NIU just went public on the Nasdaq in mid-October this year. GGV led NIU’s Series A back in 2015, and Jenny Lee, our colleague, joined the board. We have backed the company every round since then, all the way through its IPO, and we are now the largest VC shareholder in the company. We are very excited to have Yan and Token with us today, almost fresh off a plane from New York. Congrats on your IPO and welcome to the show.

YAN LI: Hi. Thanks, Hans and Zara. We are very, very honored to be on the show.

TOKEN HU: Yeah. Actually GGV is helping us a lot. Especially like yesterday, I introduced my product to my God, Tony Fadell [laughter]. It’s like a dream come true for me.

HANS TUNG: Yeah, so you’ve been a fan of Tony Fadell for a long time?


ZARA ZHANG: So how does it feel to take a company public on the Nasdaq? What was your most memorable moment for your New York trip?

YAN LI: Very exciting. Very exciting. I think the most memorable moment for me and Token was actually— well, we didn’t realize the Nasdaq Bell is actually digital now [laughter]. So we were holding hands together, pushing that bell, pushing that button. It’s on a digital screen [laughter].

HANS TUNG: That’s right.

ZARA ZHANG: You were imagining a physical bell?

YAN LI: Yeah. We imagined a physical bell. And they had a physical Gong at the end. But it is not as fun as that digital one. So that’s most memorable for us.

TOKEN HU: For me it was just too exciting. I just forgot how to talk. And Yan was holding my hand, pushing the screen. It was just like, yeah.

HANS TUNG: Yan, you have a background in private equity and you also worked at KKR before joining NIU. Can you talk about your transition from an investment professional to a startup executive?

YAN LI: I think it was very interesting. At KKR I was with KKR Capstone. It’s an operation of KKR where we’re airdropped into the portfolio companies that we invest in and then become sort of a full-time or part-time executive within the company. And I think NIU is the company that has the most technology and the most exciting work I have ever taken. At KKR, I managed more traditional companies like call farms as well as liquor companies. When I got the chance, when Jenny extended the offer to be part of the NIU family, I looked at it — this is the most high-tech company, the most cool product — and I was super excited. The transition was easy, and it’s been just as exciting for the last four years.

HANS TUNG: Right. How did you get to meet Jenny and the company?

YAN LI: Well, it was through introduction. I had heard of Jenny and GGV in the past. I had heard of Hans as well, so happy to meet you as well. And there was an introduction through other VCs who sit on the board. I still clearly remember I met Jenny at Starbucks in Shanghai. We had a two hour chat. It was very interesting and very exciting.

ZARA ZHANG: So who are your customers and why do you think they’re buying your products?

TOKEN HU: According to our big data analysis of all the information we’ve got, our users are daily commuters. At NIU we’re not doing a toy for the users. They are aged between 25 and 35, the majority of our customers. And also in our database we can see that their daily trip is around 20 km. And monthly trips is between 300 and 350, which means it’s their daily commute vehicle in their life. We are trying to help them avoid all the traffic jams, all the slow city movement. We’re happy to see that we’re literally changing their lives from super rushed city traffic to freedom.

YAN LI: Just to comment on that, I think we appeal to young users. And by young, I don’t mean age. If it’s 25 to 35, I think Hans and I are already out of the picture [laughter]. Literally yesterday I was talking to some of the GGV LPs and they all love our products. And one LP said, “The people who love your products are the people who have a young mentality.” And I think everyone has a young mentality at this point. Everyone feels young inside. So we want to make sure that when people are riding our scooters, they help to remind them what freedom is, roaming free in the city. I think that’s one of the emotions we try to bring to our users.

HANS TUNG: Is that the reason why you guys have become a lifestyle product and brand in China?

YAN LI: It’s not the reason, but I think it’s what the lifestyle represents. We are the first lifestyle brand in China in this two-wheeler market, and we hope to become a lifestyle brand in all urban mobility markets. And I think we’re on on the way to doing that. Token can talk about the accessory part. I think we have some amazing accessories.

TOKEN HU: Yeah. When you’re building a brand, it’s not only about your major product. It’s building an environment for your users for their daily life. It’s not only about riding a scooter, it’s also about having your product with your brand philosophy in their daily life. And right now we have a really strong approach in accessories. We have different categories like riding gear or brand apparel. For example, the t-shirt I’m wearing today is really hot in our community. We want to have a full life circle around our users.

YAN LI: And just advertising. For the people who haven’t got a NIU scooter, they can get accessories. The t-shirt is on sale on our website, www.niu.com.

HANS TUNG: Excellent [laughter]. Good salesman.

TOKEN HU: Normally our users get NIU accessories first. For example, they have an existing e-scooter and they want to try our accessories. They’re thinking about changing in the next few years, but after they purchase our accessories, they immediately become NIU riders.

ZARA ZHANG: So in terms of geography, where are they? Are they in first-tier cities or lower-tier cities?

YAN LI: Oh, we cover a wide range. We’re in 150 cities in China and also 23 countries internationally. Because we’re really trying to solve this urban mobility issue. We see traffic congestion not only in first-tier cities, we see it in the Tier 3 cities, Tier 4 cities as well. So if our product is able to solve users’ pain points, I think that is what allows us to penetrate in more depth into China as well as internationally. And lastly, being the most stylish scooter out there adds an excitement point to our users. Riding a scooter is not just your daily commute. It’s actually a demonstration of your personality, a demonstration of your beliefs. I think, regardless of where you live, people want that.

HANS TUNG: The company’s only four or five years old. How do you guys figure out a way to enter and penetrate so many different markets?

YAN LI: I think a few things. First of all, I think the product is unique, being a Lithium-ion based battery scooter. A Lithium-ion battery is very light. It’s actually portable, very easy for people to take home to charge. So that solves a big pain point. And the design is unique. Our M Series is the first mobility product that has ever won seven international major awards in terms of product design. This is in the last 20 years. To give you an example, for the U.S. IDEA Award, the I-D-E-A, we won the silver medal and the bronze was the BMW new 5 Series.

HANS TUNG: Wow. Very impressive.

YAN LI: At first when we got the silver, we were sort of disappointed.

HANS TUNG: Until you find out who’s number three.

YAN LI: Yeah. We were like, “We didn’t get the gold.” But then we saw, “Okay. BMW 5 got the bronze.” At least we feel a little better. And then it is about services. We have more than 570 stores in China now, and globally we have like 700 sales points. We actually want the services to carry us through to penetrate the Tier 4, Tier 5 cities. Because when people buy those scooters, they need good after-sales services, and we have branded stores to provide that service. I think that makes people feel like they’re getting a holistic experience. Not only the product, but actually through the entire usage cycle of our product. That’s what we are trying to ensure here.

ZARA ZHANG: So Token, what is the design philosophy behind your scooters?

TOKEN HU: I always have this question. I talked about it with Tony yesterday and he gave me really good feedback, which is that design should have a tyrant. Right now, a lot of companies are talking about when you design a product, it should go through all the surveys, focus groups, and everything. I have been in the consulting industry for many years. Those things are your gods. But the final product should be from your life. The people in our R&D team, even our management team, are riding our scooters every day. We got this guy, the former PE guy, on a scooter. If you’re the first-hand user and you’re riding daily, you’re designing products for yourself and solving your own problems. It’s better than if you want to entrepreneur something and make some money. It’s a huge difference. This is a key secret sauce for us.

ZARA ZHANG: Could you also talk about your background and how you came to join NIU?

TOKEN HU: Yeah. My background is complicated. High school dropout. The first job I got was dishes in a restaurant—

HANS TUNG: Washing dishes?

YAN LI: So for the international listeners out there, it’s actually very difficult to be a high school dropout in China.

HANS TUNG: Very difficult. It’s not easy.

YAN LI: I think in the US it might be easier.

HANS TUNG: Yeah. Maybe it’s kind of cool in the US, but in China it’s not easy.

YAN LI: But Token managed it.

TOKEN HU: I’m not encouraging people to drop out early because we were lucky. We had just been through the whole internet industry, growing super fast. I started learning from the internet, and eventually in 2007, I got to Microsoft. Afterwards I jumped to the top company, it’s called Frog Design. It was founded by Hartmut Esslinger, who created Apple’s design language. I was learning there for four years, literally learning my language and all my professional skills at my work. It was quite a dynamic life for me.

HANS TUNG: Right. This is why you respect Tony Fadell so much as the founder of iPod and the co-founder of iPhone.

TOKEN HU: Yes, yes, yes.

ZARA ZHANG: How did you meet the NIU team?

TOKEN HU: Actually, I’m the guy who had the idea in the beginning. In the first year I just spent time on it myself. But it’s a huge product. It’s not only about design and R&D. You should really think about the manufacturing, the marketing, the sales, after-sales, everything. And I visualized that I’m not the right guy to hold the whole company because I truly know myself. I’m good at some things and anything else I can learn. I met a guy who introduced me to his friend Li Xiang, the founder of AutoHome. And he introduced his friend, Huang Mingming. And then—

YAN LI: And then the venture, the VC guys, the Jennys, they came and helped us to set up the team.

HANS TUNG: So how do the two of you divide up your responsibilities?

YAN LI: I mean, we draw a line here, right? Obviously, I don’t want to claim that I’m the creative guy [laughter]. That would be the wrong thing to say, right? So draw a line here. Token’s sitting next to me on my right, so on my right, this is all about creativity, all about product, technology, that’s all there. This side would be all about numbers, all about how to get the product to the users, how to make sure users are satisfied with our services, about execution and the more business side.

TOKEN HU: If you take a picture, it’s like suit guy and hoodie guy [laughter].

YAN LI: Which is exactly what we’re wearing today.

ZARA ZHANG: So there are so many things you could design in the world. What especially about scooters excites you?

TOKEN HU: I first had the idea in 2009. During that time I was living in Shanghai. From my apartment to the office it was 4 km across Huaihai Road, which meant no chance of getting a taxi and waiting for five or six buses that I couldn’t even squeeze into.

HANS TUNG: Yeah. Always full.

TOKEN HU: Yeah. And no subway. I had my motorcycle but, every day, all the gears and everything. I also tried riding a bicycle, but when I showed up sweaty in the office, my boss was pissed off. So I tried to find a way to solve my own solutions. I looked around and thought that e-scooters were a good solution. But during that time, they were all really bad quality and design. I thought I was the coolest product and technology guy. I would never use those products. So I thought, okay, I’m doing the products for all the top 500 companies, doing innovation for them. Maybe I can just do it for myself. That was the start. To truly solve my own problem. When I did the first scooters, all my friends said, “Come on, Token. I need one.” Guys like the Creative Director from a huge advertisement company, the VP of a tech company. I just thought, okay, these guys would never think about riding a scooter. But when they see really cool stuff, they will buy it. That’s the thing.

HANS TUNG: Right. Makes sense.

ZARA ZHANG: So we all know that hardware is hard. How do you deal with the whole supply chain and manage this huge operation that’s a lot of operationally heavy stuff?

YAN LI: Well, first of all, we don’t want to take the entire credit. Yesterday at GGV’s event, Tony Fadell said it perfectly. He said he actually envied Chinese entrepreneurs because here in China, there’s a very good manufacturing base and very good hardware manufacturers, whereas in the US there’s a shortage of that. Looking at the China market, annually there are about 30 million electric scooters. Most of them are lead-acid, but they’re still scooters. So upstream supply chains, there are a lot of manufacturing suppliers to provide the key components. One of those key components is the Lithium-ion battery, and that manufacturing is also abundant in China, driven by the electric vehicles rush. So we’ve been benefiting from those trends.

Having said that, we had to spend a lot of effort in terms of upgrading the quality of our suppliers because those suppliers used to provide parts to traditional lead-acid scooters, most of which don’t have very high quality requirements. So we have to have a very strong quality management team to actually sit on our supplier’s manufacturing line and inspect their quality to help them to improve. And that was literally the effort we put in. So it wasn’t about shortage of manpower, shortage of materials. It was shortage of high quality stuff.

HANS TUNG: Right. Raising awareness.

YAN LI: The team we hired to manage our supply chains, we hired them from Huawei, some from automobile companies.

TOKEN HU: Honda, Suzuki.

YAN LI: Right. And some from consumer electronic companies. There’s a guy that manages our quality that used to be a quality guy for a high-precision meter equipment company. So let’s think about that. He’s taking that quality standard and adapting that to the scooter industry. So that was basically how we got our quality improvement here.

HANS TUNG: It’s smart to take a B2B standard and put it into the B2C market.

YAN LI: Thanks. I think that’s a great way to summarize it. Next time I’ll use that sentence [laughter].

TOKEN HU: Also the thing is, in China, we always have really good manufacturing in all the different industries. We have a really diversified supply chain. Some of them from the motorcycle industry, the car industry, even the mobile phone industry. We’re using all the chips. We’ve got the benefit from the smart watch business because they have a huge quantity of all those chips. They have super mature manufacturing. In NIU, we are not designing the chips, but we always say that technology is really cold. Our job, our innovation is to integrate every cold technology to deliver a warm experience to our users. That’s the key point.

HANS TUNG: Got it. So on the sales and distribution side, originally you were selling e-scooters online as an e-commerce company. And then you evolved and added offline stores as well. What was the thinking in terms of doing that, and how did you quickly have stores in so many different countries and cities?

YAN LI: It’s a great question. It wasn’t driven by sales, it was actually driven by services. Because when we initially sold online, we were a big hit. In 2015, when we first did the JD crowdfunding, we broke the JD crowdfunding record in China.

HANS TUNG: I remember that.

YAN LI: Yeah. We did about RMB 72 million of sales in 15 days. I think, world record we were ranked number six. It was very hot. But what happened when our user got a scooter? Because it is, as Token mentioned, it’s a commuting device. It’s not a toy. So they use it on a daily basis. When you use those things on daily basis, you will need to have it serviced. You know, you may get a flat tire or something. And at that time, our service network was through a third party, not through our own service network. So the user felt like they had a high-end product, but when they received a service, it was a really cheap, knock-off service [laughter]. And there were complaints, because Chinese users—

HANS TUNG: They’re vocal.

YAN LI: They’re very vocal. I mean, it’s not a reserved culture anymore. People are very vocal. Then we realized, we said, “Man, we need to build our own services.” And as usual, those branded services naturally evolved to become sales as well. So that’s how the decision was made. And how it spread in China and globally was, we didn’t look at our distributors as distributors. We don’t even call them distributors. We call them city partners. We even made NIU name cards for them. It would be like, NIU Technology, Hangzhou City Partner. We carefully select those city partners. Basically the people who really believe in our cause, and really believe that when they join this path, they can change the way people travel in their city. So yes, we’ve got some really zealous people who really love us. That’s how in each city like Beijing, Nanjing, Hangzhou, all those big cities, we got city partners to come in and start building up stores. Yes, at the end of the day, they enjoy the economic benefit. But when they signed up, the economic benefit was not the first intention. Because if you think about that time, we were a startup. We convinced people, “Hey. Let’s open up a store like an Apple store with that quality of furniture and everything.” Obviously there’s a higher capex involved. But then provide service to our users. On day one you cannot say, “Hey. You will make money.” But they loved it. They thought it was a great idea to carry this unique product to the users in their city. I think they just loved that concept. That helped us to expand.

TOKEN HU: Also the really interesting thing is that a lot of our store owners were not in this business before. They became NIU users first, they enjoyed being in the community, and they became store owners. The service is for their friends. It’s not only for their customers. It’s a huge difference.

YAN LI: I mean, the benefit is they got a free tester vehicle [laughter].

ZARA ZHANG: Maybe you could touch on the NIU name. A lot of our listeners don’t speak Chinese, so NIU is spelled N-I-U, which means bull in Chinese but also has other meanings.

TOKEN HU: Yeah. When we started this company, we wanted to do it internationally. And we selected a lot of words that were pronounced differently. The niu in China is a small bull, but you can also pronounce niu as N-E-W. We’ve got something niu and something new. We’re rushing like a bull but also we’re creating a new industry and a new way forward. It’s a really good—

ZARA ZHANG: Yep. Lot of puns [laughter]

YAN LI: And just a little touch on that, niu in Chinese is a little bull, right? It has a very good implication. It’s not like you’re super proud, but you’re a little bit proud of the achievements you have done through effort.

HANS TUNG: Right. It has a well done, impressive kind of connotation to it.

YAN LI: Right. So I think that’s what we try to build into our users. Basically by riding our scooters, you feel that you’re a little bit proud. And hopefully, the hours you will save on the traffic you can use to accelerate your career somehow so you can feel more proud.

TOKEN HU: Also, when we selected a ticker for Nasdaq, the first choice was NIU. The second choice was NIUB [laughter]. You know what that means? It means it’s great.

HANS TUNG: Super awesome.

YAN LI: Yeah. I think that’s sort of overstretched [laughter]. It’s a joke. It’s a joke.

ZARA ZHANG: So in the first half of this year, around 13% of your net revenue was derived from sales outside of China. So could you talk about how you plan to go global? I know you’re already in Europe. So what are some other markets that you’re excited about?

YAN LI: I think we’re excited about the entire global market, to be honest. We’re in Europe first because back in 2015, when Token and I were still very young, we’d delivered our product. And a few months after we delivered our product, we had an ambition to debut our product at EICMA. That’s E-I-C-M-A. It’s the largest two-wheeler show worldwide, in Milan every year. Basically, Vespa, BMW, all the heavyweight guys are there. So we wanted to see whether we had a chance at the world stage. But we got a lot of enquiries and and interest from Europe during EICMA. And we were not even in the main exhibition hall. We were in the— what was it?

TOKEN HU: Spare parts.

YAN LI: Yeah. We were next to tires and suspensions. People usually don’t even show up to those halls. And because of us, we got really big traffic in our area. So that actually gave us the confidence that, hey, we’ve got a chance in Europe. And then there were distributors from America, there were distributors from Southeast Asia who also visited our booth. I think it’s all about how we basically plan out our international expansion, gradually in a step-by-step fashion.

TOKEN HU: Also I remember on the first day in EICMA, people asking, “Are you guys from Japan?” [laughter] Or Korea. I said, “I’m Chinese.” We’re not trying to fake. As you know, in China, a lot of brands just go register—

HANS TUNG: Register elsewhere.

TOKEN HU: Yeah. But we are a proud Chinese company doing a show. Yeah.

HANS TUNG: Let’s switch topic a little bit and talk about your IPO. The capital market right now is not very good. Some argue you could be the last company to go public in the US in this wave. What are some of the lessons or advice that you can share with our audience about what you went through?

YAN LI: About IPO?

HANS TUNG: Yes. About what it takes to go public.

YAN LI: Well, I think advice number one is make sure GGV’s on your board [laughter]. And advice number two, get Hans and Jenny involved as early as possible.

TOKEN HU: Yeah. That’s truly an insight.

YAN LI: Yeah. But I mean, it’s not a joke. It’s not a joke. We’re actually very appreciative. Throughout the process you guys have been extremely helpful. Extremely helpful. But I think the advice is really— looking back, nobody can control the timing. When we started the process, the timing looked much better. So I know the capital markets weren’t good, but there’s nothing you can do about it.

HANS TUNG: Right. But you prepare quickly. Prepare early.

YAN LI: Right. Right. And then, the whole thing was actually— I want to talk more about after the IPO. I think both of us felt that excitement when we pushed the button. But after that, tons of pressure comes in and you realize that initially you had the trust of private investors. Now you have the trust of public investors. We feel like everyone who owns even just one share of our stock, we feel—

HANS TUNG: Responsible.

YAN LI: Yeah. We feel responsible because we want to make sure we deliver value to them long term. That means we need to work harder. We need to basically do what we do the best and keep rolling out better products. And it never stops. This game never stops. So, yeah, I had more sleep when I was a private company [laughter].

TOKEN HU: Actually, since I’m the product guy, if I evaluate the launch event in Paris this year and the IPO, I feel more proud of our product launch.

YAN LI: We should talk— we can still cover seconds, but we did want to talk about our product launch. Token can go for it.

TOKEN HU: This year we launched two products in Paris in the Grand Louvre. It was awesome. It was the first time introducing our products to Europe and a global audience. It was much more pressure for me because we should be thinking about the next three or five years of our product scope around the world. And really digging into all the technologies and designs to help people globally.

YAN LI: I’m not sure if we’re the first mobility company to launch a product at the Louvre, but we’re definitely the first two-wheeled mobility company. And definitely the first Chinese mobility company. And the whole launch was live broadcast in four languages.


YAN LI: Five. Initially I was thinking English and Chinese. But no, I’ve got a German audience, so they want me in German. I’ve got Italian guys. They wanted me in Italian.

TOKEN HU: French.

YAN LI: Then I— oh, more languages. Italian, German, French and Spanish. We were lucky the Swedish guys speak pretty good English [laughter]. Because I’m looking at the financial numbers, right? Every single live translation costs money [laughter]. So I was talking to my international team. I was like, “Hey—”

HANS TUNG: Can we drop a language?

YAN LI: Yeah. “Can we drop German?” He was like, “We’re doing great in Germany. You need to do it in German otherwise you don’t respect the users.” I was like, “Okay, we’re going to have to do that.”

ZARA ZHANG: So our audience can watch the video on YouTube, right?

YAN LI: Yes, yes.

ZARA ZHANG: A lot of people will congratulate you when you go public. But does that give you more pressure? And you mentioned that you actually sleep better when you’re a private company. So what are you most excited and most worried about going forward?

YAN LI: Well, I’ll talk about my part. I think Token can talk about his. Most of the exciting part for me is actually being listed public. It really put us on the spot, globally. It sort of said, “Hey. We have accomplished from zero to one.” We started as a Chinese startup, but now we are a public company that has a chance to gain global market share. It gave us a window of opportunity. I think that’s what excites me about it. What worries me about it is the same thing. Now we’ve been given a chance, can we actually grasp that chance? I think our entire team has to deliver, has to work hard. And I think I would shoot myself if we actually didn’t grasp that chance.

HANS TUNG: Right. You don’t get that many that chances like this.

YAN LI: Yeah. And some of those chances are just once in a lifetime. So we saw that window of opportunity. Now it’s actually in our hands to say, “We need to get that.” So that’s where the huge pressure is coming from.

TOKEN HU: Actually for myself, doing the IPO is a pressure, but it’s not the most pressure part because I’m always a self-pressure person. And also, the day after we got the IPO, I was really like freezing. Because, “Okay. I got time. Come back to my product side.” [laughter] Seriously. There’s too much travel. I never work.

HANS TUNG: IPO was a side job.

TOKEN HU: We have Yan here. He is much more professional than me.

YAN LI: I saw where Token got most nervous. It wasn’t about roadshow. It was about yesterday meeting Tony Fadell [laughter]. This guy. Literally, I’ve never seen him so prepared. He wasn’t that prepared at roadshow. But meeting Tony Fadell, he was like, “What am I supposed to talk about? I spent like two hours yesterday to prep up what I need to talk about.”

TOKEN HU: Yeah. All the videos, everything in my iPod [laughter].

HANS TUNG: So getting to IPO obviously was not an easy journey. And if you reflect on what has taken you to this point, what were some of the most memorable moments that either you experienced or your team experienced that are worth sharing?

TOKEN HU: For me, it wasn’t about the time we IPO’d. For me it was after the opening bell, when we saw all of the advertisements in Times Square. So literally you’re broadcasting your product, your vision, also your ambition around the world. I took a picture there and I think it probably changed my life because it’s more responsibility.

YAN LI: I think some of the moments for me looking back— I think it’s also a moment for Token, but he’s actually in that picture so he couldn’t remember. There are a couple of moments. The first one was when we got the first product prototype, when the prototype got shipped in Beijing. And you looked at Token’s face and you couldn’t tell whether he was smiling or crying [laughter].

HANS TUNG: Or both.

YAN LI: Yeah. Or both. It was like a mix of smiling and crying. It was like freeze that moment, right. Then there was the time when we first did the crowdfunding. We knew we were going to break the record. Not on the 15th day, we knew on day one. Because on day one we saw the number was huge. Usually with crowdfunding, on day one the number is huge and then it starts to cool down a little bit. So it was midnight of day one when the results came in. Everybody was in the office. Nobody left. Even people who were not involved, they didn’t leave because everyone was looking at that number.

TOKEN HU: Also I’m yelling for the numbers [laughter].

YAN LI: So that moment is like, finally you’ve got something. Because initially the product was a concept, not a product. But finally you put it on a stage where—

HANS TUNG: Real money is being exchanged.

YAN LI: Right. Or real users come in. You feel like there are people buying it. So that kind of rush was like—

TOKEN HU: For the crowdfunding, the most memorable thing is that none of these users had seen this product in real life. As a vehicle. They’d only seen—

HANS TUNG: Yeah. Just based on your concept.

TOKEN HU: Only a couple of hundred people in our first large event had seen it in real life. We had a couple of pictures, one video. And people were buying. Full payment, buying our product. It’s a huge honor to be a product guy and have people love your project. Oh my God. It’s awesome.

HANS TUNG: Makes sense.

ZARA ZHANG: So we’ll go to the last part of the interview which is a round of quickfire questions. The first one is who is the entrepreneur you admire the most and why? Besides Tony Fadell [laughter].

TOKEN HU: Personally, Elon Musk. This guy’s crazy. This guy is beyond everybody’s thinking with Tesla, SpaceX, even The Boring Company. I really like his fire gun. It’s just dreaming about what no one else is dreaming about.

YAN LI: Since Token said Elon Musk, I would have to say Steve Jobs. It wasn’t about building a product. I think he built a product, but he actually built a great company. And he built a long-lasting company. This is a little bit cliched, but I didn’t know that Apple was listed in 1980. And then look at how Apple grew after the listing. I’ve read his biography and I’ve seen some movies about him. The guy’s driving crazy on the product, but he has a great business sense. Like I understand how to build a great company. He does it all. So you just wonder how that happened, right? And they changed the entire industry. We’re hoping we get a chance to change the urban mobility industry.

TOKEN HU: Sorry, I have to correct you. Steve Jobs did not create a brand. He created a religion [laughter]. That’s the truth.

HANS TUNG: So what’s something you’ve read recently that you’d recommend? Like a book or—?

TOKEN HU: Actually a book my wife gave to me. It’s a history of KKR [laughter].

HANS TUNG: So you get to know your partner better.

TOKEN YU: Yeah. Because as you know, I’m not a reading book guy. Most of the things I read are not about business. They’re not about finance or something. I read books more like Wuxia.

HANS TUNG: The Kung Fu novels.

TOKEN YU: Sort of. But it’s more like you’re fighting with your brothers, with your friends, to achieve what you believe.

YAN LI: I was actually looking at my— I can say Audible, right?

HANS TUNG: Yes. Book or audio. Podcast too.

YAN LI: So the one I’m listening to now is called Powerful: Building a Culture of Freedom and Responsibility by Patty McCord. I think she was the HR head of Netflix. Because as we’re building our company, the culture is super important. And Netflix has this 100-page PPT about how they build culture and hire the right people. So I think that got me interested, and then she came out with the book to see how they actually build from firsthand experience. To have a long-lasting company, in the end it’s about people. It’s about the culture. And we still have much to learn, so that is a book I recommend.

ZARA ZHANG: What do you for fun?

TOKEN HU: Me? Riding, riding, and riding.

HANS TUNG: You love to ride?

TOKEN HU: All types of two-wheelers. It’s part of my life.

YAN LI: There is another part that Token does for fun, but I think their kid is too young, so he doesn’t realize yet.

TOKEN HU: Oh, about the memories thing. I had my first daughter. And the day after, I went to roadshow.

HANS TUNG: Oh, wow. Talk about dedication.

TOKEN HU: Yeah. Everything just happened in the same two weeks.

YAN LI: Right now besides work, I think the rest of the time I am spending with my daughter. She’s 4 and a half years old.

HANS TUNG: Good age.

YAN LI: Yeah. It’s an age where you can engage in interesting conversation with her, but you never can convince her to do things that she doesn’t want to do. So she loves her NIU scooter. My wife is a little bit afraid of taking her out on the scooter. So during the weekends, she’s like, “Dad. You need to take me out on your scooter.” So that’s a 40-minute drive around our apartment complex.

ZARA ZHANG: So last question, what type of roles are you guys hiring for and how can people reach out if they’re interested?

YAN LI: We’re hiring all sorts of roles from R&D, from marketing, from sales. We were already able to attract good talent, but now, since we’re public, hopefully that will allow us to attract more talent and be as competitive as Baidu or Xiaomi.

HANS TUNG: Wow. Very good. Obviously, scooter sharing has become a very popular phenomenon in the US with Lime and Bird. And then that’s spread to Latin America and Europe. Even Hello Chuxing in China is rolling out scooters. Do you ever think about coming up with a product for that market that’s not for someone to own and ride for themselves?

YAN LI: We actually have that already. We are supporting scooter share operations in Europe. There’s a company called Scooty using our scooter share in Brussels. There’s also a company called Movo or M-O-V-O using our scooter sharing in Madrid. And there’s also a company called goUrban using our scooters for sharing in Vienna. So all those scooters are— we provide an open API so that they can link to the backend management system.

TOKEN HU: The product is not only physical scooters. We provide all the frame management, all the API, all the cloud services as a package to them.

HANS TUNG: Oh, good. We have some portfolio companies in this space. Happy to get a link about your product from you later.

YAN LI: Yeah, we’d love to.

HANS TUNG: So what motivates you to wake up each morning and what keeps you up at night?

TOKEN HU: Empty. Always empty.

HANS TUNG: When you wake up in the morning you feel empty?

TOKEN HU: Yeah. Because I’m a really good sleeper.

HANS TUNG: So the first second you wake up, you feel great? No worries?

TOKEN HU: Yeah. I wear my digital watch every day. Some people, they have a really light sleep and then go into deep. For me, in the first 20 minutes, I go deep [laughter]. And it stays deep until I wake up.

HANS TUNG: What keeps you up at night then?

TOKEN HU: At night I’m always thinking about, not product, it’s more like philosophy. Like what problem can we solve? It’s not only about urban mobility, it’s about people’s beliefs. And that’s hard. I’m always diversified and thinking randomly. Always jump, jump, jump, jump, jump.


YAN LI: My daughter wakes up at 5:30. So it’s not about what. It’s who. She wakes me up every day in the morning by rushing into our room. She goes to bed around 8pm, so that’s how I explain it.

HANS TUNG: She’s always energetic in the morning?

YAN LI: Yeah. So then you’re up. I actually have a— this is one part of that I’d like to share. I’m not sure if it’s true or not, but based on Token and me, I think it might be true. I think to be a good entrepreneur, you need to be a good sleeper. I sleep very soundly, no matter what’s out there or how big the pressure. I fall into the deep sleep stage very quickly. I think you have to let go. There will always be things out there. You never know what’s going to happen the next day. But you still need energy to prepare for that, so make sure you get a good sleep. It doesn’t matter if it’s four hours or six hours. Actually, Token doesn’t sleep for that many hours.

TOKEN HU: The interesting this is that we did calculate it. It was me and Anna and our Design VP, Karl. And we talked about it with our R&D team. And one guy called Chris, a really early employee in our R&D team, said, “Okay. We know why we’re not able to be entrepreneurs,” because we calculated that me and Karl sleep like three or four hours a day.

HANS TUNG: Right. Everyone else needs more?

TOKEN HU: They need at least five to six hours. And also, a good memory is really important.

HANS TUNG: So what keeps you up at night, Yan?

YAN LI: Sort of nothing, right, because I’m sleeping [laughter].

HANS TUNG: Sure. Come on. Come on.

YAN LI: I don’t want to give big words about how to grow a company or anything. But I do have a habit of planning out the next day. So before I go to sleep, I do spend a bit thinking in terms of what things to do, who I’m going to talk to tomorrow. I don’t meditate every day. I do that once a week. But I do think sometimes it makes sense to step back and rethink the whole thing. One useful piece of advice to give to everyone is, if you do a daily job, you get sucked in. It’s worthwhile to take a step back and reflect and say, “Actually, what matters?” Because when we look back, maybe just three or four things really matter in the end. But when you’re in the job, sometimes you lose that big picture. So in some sense, what keeps me up at night is I need to constantly remind myself to step back and see what matters because I’m so afraid that I will get lost in the daily nitty gritty details and forget the big picture. I think that’s what I worry about.

HANS TUNG: That’s very good. I can relate. I travel a lot as you guys know, and I can sleep very well on planes.

TOKEN HU: Yeah. All the vehicles, any kind of transportation.

HANS TUNG: I think in the old days, the good generals could do that as well when they were fighting on the battlefield. Otherwise you’ll succumb to all the pressure and worry and not be able to function properly.

ZARA ZHANG: Yan and Token, thank you so much for being here with us, and we can’t wait to see where NIU will go next.

YAN LI: Thank you for having us. It’s great.

TOKEN HU: Yeah. Thank you.

HANS TUNG: It was a pleasure.

Thanks for listening to this episode of 996.

ZARA ZHANG: GGV Capital is a multi-stage venture capital firm based in Silicon Valley, Shanghai, and Beijing. We have been partnering with leading technology entrepreneurs for the past 18 years, from seed to pre-IPO, with $6.2 billion in capital under management across 13 funds. GGV invests in consumer new retail, social Internet, enterprise cloud, and frontier tech.

GGV has invested in over 290 companies with more than 45 companies valued at over $1 billion. Portfolio companies include Airbnb, Alibaba, Ctrip, Didi Chuxing, Domo, Hashicorp, Hellobike, Houzz, Keep, Slack, Square, Toutiao, Wish, Xiaohongshu, YY, and others. Find out more at ggvc.com.

We also highly recommend joining our listeners WeChat group and Slack channel, where we regularly share insights, events, and job opportunities related to tech in China. Join these groups at 996.ggvc.com/community.

HANS TUNG: If you have any feedback on this podcast, or would like to recommend a guest, please email us at 996@ggvc.com.