For the second consecutive year, our Co-Founder and CEO, Peggy Choi, represented Lynk Global, Knowledge-as-a-Service platform pioneer at the World Economic Forum Annual Meeting of the New Champions 2019 in Dalian, China. She was invited to speak in a panel discussion on the Promise of Platform Work, as well as hosting a hub session on “China in Depth: Innovating Outward,” as shared in this reflection piece from Peggy.
At the Center for the Fourth Industrial Revolution dinner prior to the Conference, she conversed with global game changers from China and realised that most of the founders in the room had already expanded globally or have plans to.
In the past, Chinese companies would focus on domestic market first before venturing outward. Recent trends have shown that a growing number of Chinese companies are in international markets in much earlier stages. The fierce competition and domination by major tech companies drive up costs for startups to compete domestically. Increasingly, companies see relatively higher ROI by going abroad.
In 2018, 40% of China’s digital companies generated revenue overseas. Larger companies may globalise via JVs or investments. Companies with asset-light business model such as ByteDance, which owns the viral app, TikTok, have been most aggressive in organic expansion by launching their products directly in new markets. Another way of going global is by targeting existing Chinese customers who travel abroad and require global services, such as Ucloud and Ctrip.
Peggy observes from the activities at Lynk with a growing roster of venture capital firms, companies and startups that there has also been an evolution in the new markets that these companies focus on. It was primarily Southeast Asia and India a year ago, and recently more interest Middle East, Africa, and Latin America. This reflects also the increasing competition in Southeast Asia and India from large Chinese and US tech firms and domestic players, driving interest in new markets where there is potentially more room to grow.
Having an international work background, Peggy highlights key enablers that are vital for innovating outwards in China:
- Founders who are unafraid of going global
- Confidence having seen successes of local players scaling abroad
- Know-how in terms of networks, local customs and preferences
- Leaders with a global mindset and local experiences
- Global partners (such as venture capitalists) are critical to the entire infrastructure
- Global Knowledge Network, such as Lynk
Because demand lies abroad or eventually will be, it is not unusual for Chinese companies to have a global mindset from its very inception. Here at Lynk, we have a global mission to democratize the access to knowledge, and as Peggy states, “If a company has a global vision, it is pivotal to start with global DNA from day one.”
Boston Consulting Group (BCG)