My power problems and an insane schedule led to be getting behind in updating, but I’m finally starting to dig out today.

Sunday night I didn’t sleep much. I was told to stay up until 10p the first night and made it to 9:45 before crashing. But I woke up at 2:45 like it was morning. I had breakfast at the hotel,  they have absolutely amazing buffets here. And met my I met my translator, Charles Jiang. We took the first of what would be many taxis to meet Tomer Rothschild at a Starbucks (they’re everywhere in Beijing like they’re everywhere everywhere else).

Tomer is a Wharton MBA who’s been in or around China and Taiwan since the ’90s. Among his experiences, he worked at Bally Total Fitness opening China.

• Bally’s joint venture with the China Sports Institute (part of the state, as is almost everything else here) was a very typical failure.
• There is extraordinary brand consciousness here – especially in things that “show”, like cars, handbags, etc…
• Things are changing at a furious pace
• A huge opportunity exists for new lifestyle products like wine, baby products, restaurants, spas, etc… People are looking for ways to spend their money.
• There’s a tidal wave of Chinese students going abroad to study, because the top schools admit less than 1% of applicants so there are extraordinary students who can’t get it, there is prestige in going abroad to school, and more progressive parents think the education is better outside of China.
• The government is critical here in a way it simply isn’t in the west. And it’s borders are wide and blurry.
• Best line, in reference to driving: “the hardware is great, the software is a mess.” Absolutely true, the Chinese are not the best drivers. I saw three accidents in my first 24 hours here.

The we took a long taxi ride to the “Silicon Valley” of Beijing, where Google, Microsoft et al have office towers near Beijing University and Tsinghua University. Other than the lack of Indian and caucasian faces, and the vertical rather than horizontal buildings, it could be Palo Alto – it has the same feeling. We had lunch at a Chinese “fast food” place. The food could have been from the Chinese place in the strip mall at home (actually, it’s excellent). We’ll see how it stacks up to a Chinese feast – supposedly I’ll be having one of those tomorrow. Then we went to Innovation Works to see Chris Evdemon and the famous Kai-Fu Lee.

entrepreneur at Innovation Works

Chris is a successful Greek entrepreneur and angel investor, who is now Investments & Business Development Manager at Innovation Works. He started an international computer skills testing company in Greece and sold it. Before coming to China he spent some time in Singapore. We spent most of our time talking about the early stage investment environment in China.

• Shanghai angels are more mature, Chris is President of a group there that is 10 years old.
• There are groups like the China Business Angel Network which has 60 members.
• There’s an interesting conundrum in that the very best seed opportunities are super-local and the angels can’t find them and they don’t know how to access the angels.

After coffee with Chris I had over an hour with Kai-Fu. He was extraordinarily open and generous – I can understand why he is so beloved here.

• The Innovation Works business model started out somewhat like Idea Labs’ – they would identify opportunities and put team together around them. That didn’t work because entrepreneurs are too independent and didn’t graft to someone else’s idea. Today they are more like an incubator, taking very very early stage ideas and putting their resources around them.
• There are three key challenges that Innovation Works can help with: 1) Hiring engineers, which isn’t a challenge for them. Over 100,000 have sent in resumes to Innovation works. (Yes, 100,000 resumes. Welcome to China). 2) Figuring out the right business model 3) Making very senior level connections.
• There’s a mis-match between both young engineers’ and sea-turtles’ expectations and reality. They think they’re ready to be CEOs and few are. He thinks that the attributes of the stand-outs, who will make good entrepreneurs are initiative, self-awareness, and business sense.
• We then spent a while talking about Google. I’m going to do an entire post about the search environment and Google after I’ve met with more people.

me, Kai-Fu, and Charles

My final meeting on Monday was with Francis Goh, Search Director @Neo Ogilvy. It was great to get the rubber-meets-the-road perspective from Francis (and thanks to Barry Lloyd for the introduction!). Francis explained a lot of how Baidu works, which will go in that separate post about search.

It was a long, good first day.

Finally, a few early observations about Beijing.

• It’s ugly. I love cities. Dirt, noise, crowds – none of that bothers me. But there just isn’t much that’s aesthetically pleasing about Beijing. That’s a big surprise.
• It’s not nearly as hectic as I thought it would be. It is busy and there’s a mix of cars, bikes, and pedestrians that you wouldn’t see in the west, but it’s not frenzied.
• It is hot here right now. Horribly oppressively hot and humid.
• People are generally very casual.