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ADG China Insights - February 2018

Happy Chinese New Year!Chris role.png

(If you missed all of the statues in the shopping malls - it is the year of the dog)

The AmCham / Bain 2018 Business Climate Survey on China is out with some surprising results...

  1. American companies' confidence towards their future operations in China is on an upswing despite the constant news of China taking over the world
  2. There's increasing optimism in the future of US-China relations despite the sabre rattling of the administration and concerns of potential trade wars

With the regulatory environment now emerging as the biggest challenge, we expect China's desire to go global will set a long term positive direction as China will have to eventually loosen domestic regulations in exchange for continued access to other markets. The survey

Your biggest competition isn’t another company… and other common problems faced by young technology companies

Martin Casado from Andreesen Horowitz penned a must read article that wasn't written for China but it was still spot about bringing technology to new markets - including China.  Having personally worked closely with over 20 VC backed US and Western technology companies trying to expand in China, we see the same problems on a daily basis. Click here to read this excellent article

One of most common challenges we see at ADG is companies that fall too in love with their own technology and don't realize that no matter how amazing it may be, if it doesn't provide a complete solution or new customers or markets to the customer, then they customer's perception of the value will be limited - althoughthe engineers they are meeting that also love technology will be very happy to study it endlessly and perhaps even invest in a trial or POC that may not lead to huge dollars.

Today, technology itself has become a commodity in China and we often hear "but they are just a technology company"  which is now aderogatory way of saying that the customer might pay some money to fill a short term gap in their own offering but in the long term they see the company's value is limited as it can't attract customers or provide long term sustainable differentiation on their own.

The world has changed and walking into a meeting in China today it is no longer assumed that because you are a Western technology company your products will be assumed to be superior.  In areas like AI or big data they may even be ready to take pity on you for not understanding how far you may be behind China. 

Looking to discuss how you can accelerate your China strategy? Meet with ADG at MWC in Spain

More interesting stories you may have missed

Google and China’s Tencent Find Being Friends Has BenefitsADG, sees the tie-up with Google as a sign of Tencent’s global ambitions. “It represents that China’s technology giants have grown up,” Mr. DeAngelis said. “Tencent is now a global player.” WSJ 

Try, Try And Try Again: Facebook And Google Plan New Partnerships To Break Into China - When it comes to Google, the commercial benefits remain to be seen. For now, the AI center in Beijing is more about collecting data, which is plentiful in the world’s most populous country and critical to the training of smart machines, says Chris DeAngelis, general manager of China-based business development consultancy ADG Forbes

Chinese Ride-Sharing App Didi Raises $4 Billion in New Funding  - "The penetration of the average user is so much greater in China than in the U.S., so you actually could argue Didi is much better positioned from the perspective of training autonomous vehicles,” said Chris DeAngelis, GM of ADG. WSJ

Top 10 Coolest Innovations TechZone (YouTube)

What China is doing to create a tech edge over the US – Android Authority

China's $100 Billion Smartphone MakerBloomberg

China Will Lead an Electric Car Future, Ford’s Chairman SaysThe New York Times

China's tech firms spur cashless societyMOBILE MARKETER