Okay, so thank you for coming to talk to us. >> Thanks for having me. >> I know you have been entrepreneur for a number of years now. Could you share with us a little bit on your journey, how you become an entrepreneur? >> So, I first started about four years ago. >> Right. >> So, the company basically started, because I used to work actually with an NGO that work with a lot of students across China. So, we did a lot of mobilization campaigns, and I realized that students have a lot of passion and they want to do a lot of projects, but they may not be allowed to access to funding for them to actually make these ideas happen. So, after working with an NGO I thought maybe we can find a way to sustainably match students with sponsorships, and that's how Launchpilots started. >> So, you actually have worked in an NGO that already doing something similar. And, so you discover a gap in this case the student community? >> Right, right. But why you want to become an entrepreneur, because that's quite a big step, right? For example, from working for a corporate. >> Honestly, I didn't want to become an entrepreneur. >> Okay. >> I always thought I would work in the social sector. But even after working with some sort of social impact organizations, I felt like nobody felt strongly enough about this issue of empowering students, university students especially to do anything about it. So, yeah, it's kind of out of frustration. I decided, well, somebody needs to something. So, then, I started. >> Interesting, so you thought you're going to work for company, or at least work for NGO and so on. Not actually become an entrepreneur. So, it's almost by accident in that sense. >> Yeah, actually, when I first started Launchpilots, I thought we were going to be a nonprofit. And we started as a nonprofit. >> Interesting. >> And it's funny, because we got a lot of feedback in the early days that people didn't understand whether we were for profit or nonprofit. And then we gradually tried different models, and we found out actually a profit making marketplace worked the best. So, that's how we ended up. >> Now, you've also met a lot of entrepreneurs through a number of programs, and I know that an accelerator program, and then there is also like some competition and pitching event, right. What about the other entrepreneur? What about their story? Do you think they're more like by design, or by default, or accidents like yours? >> I mean, I think, there are portion, but maybe a smaller portion of entrepreneurs who I guess were inspired by a problem that they felt very strongly about. And I think, there's definitely a large portion of people who are more opportunistic, they see an opportunity in the market, so they decide to do it. And then there's another small portion who just thinks that entrepreneurship is cool, so they wanted to try it. >> Okay, you have gone through some excellent program in China. Could you tell us a little bit on your experience? >> Yeah, so I went through a three month accelerator, so that was actually in Dalian at that time and they've now moved to Shanghai. >> And you have not yet launched your company at that point, so you just joined a program, right? >> We already launched actually, we launched in Hong Kong as a test, and then they liked our model, and we wanted to expand that model in China. So, we went to the accelerator, yeah. >> because that's quite a big step, right? I mean, coming out from Hong Kong to China, in particular in to Dalian, North of China. How did you actually get into the program, and what do they offer in that program? >> Well, I think firstly, because my network was actually stronger in mainland China in terms of the student network. But in terms of kinds of resources, or professional hour guide, I will stronger at Hong Kong. So, I decided to start a test in Hong Kong. I think going back to China allowed me to leverage that network that I already had. I think, why they chose us may be part of that was, because I had that existing network. We also generated a little bit of revenue in Hong Kong already. So, we showed that the model probably had some attraction. >> Right, and what do they offer in that program? Do they help you to find more customers, or do they find investors, or even like some of the skills on how to manage a start up? >> There's a couple of aspects to the program. So, it basically simulates a lot of the bigger US programs, accelerator programs. So, there's a basic course that is around business, some product tech design kind of thing, and then there's definitely a large kind of investment element around that as well. So, we have basic sort of startup classes a couple times a week. We have kind of weekly mentors that come in, they actually fly in mentors. That will focus on a specific topic, and then like most accelerators you're kind of working towards the final demo day where you present your business to your investors. >> Right, so what happened after that? Did you find it useful, and how did this shape your business from that point? >> I think a couple of things, being in Dalian is, I mean you're pretty isolated. So, I mean, we live next to the accelerator, and I can walk five minutes and we can get to the accelerator. And then your kind of force to this business like 24/7 literally, basically. >> Right. >> And the other thing is, I think, because it was quite investment focused and it's quite, I mean, it's a structured program and there's weekly check in. It creates some kind of discipline around processes. So, I think, that's something that we didn't have when we were in Hong Kong. It was a bit more just freestyle and then, I think, the last part is definitely the network, so we did actually end up finding an investor from the network from the accelerator. >> That's good, that's good. So, it would be something you recommend for someone who want to start a business in China. Would you recommend to go through some of this accelerator program? >> I think, probably going through local accelerator. So, if you're, well, I think it's kind of a mix. So, if you're a foreigner entering China, I think it would be probably more helpful to go to a locally run accelerator. If you are Chinese, then going to a western run accelerator may be, yeah, you'll probably get more out of it. >> Interesting, so your advice would be for foreigner they should go for the local one. But if you are already Chinese, or from Hong Kong, you should actually go through more international one. >> Yeah. >> And what are the key differences, why would you recommend that way? >> I think the main thing would be networks. I think, for a local Chinese, it's much easier to get local investors. And more difficult to get foreign investors, and vice versa. So, I think, that's the biggest value. >> And, so while we're on the topic of like foreigners going to China, what would be the kind of the challenges, right? I think we could expect a big cultural shock, right? Is language a barrier? What would be the challenge if they come to China and start the business? >> I think, language is definitely a huge one for our users who are local students. I mean, it's pretty much impossible if you're not going to speak to them in Chinese. >> Right, right. >> I think in terms of investment, I think there are a lot of local investors who are skeptical about. Foreign founders that are trying to do business in Hong Kong, I'm sorry in China. >> So is it simply because they don't believe these foreigner coming to China will understand the Chinese market? >> Yeah. >> Okay, so that's a big gap, right? So in terms of finding investors then, that's a big challenge. >> Yeah. >> Anything else apart from knowing the local market or finding investors? >> Hm, foreigners. >> For example, let's say, if there's a foreign entrepreneur coming to China, would he face difficulty in finding employees, finding talent? How do the local talent, would they want to work for a foreign entrepreneur or would they prefer a local one? >> I think there are a sufficient number of people who are interested in this startup scene, that they would be excited about working for a foreign-run startup. So, I think there are enough people in China that you can find good talent, I think. Especially in the bigger cities, even some of the tier 2 cities. I think the start up ecosystem is building up, and so I think there are enough people who are interested. I think one thing actually that might be difficult is in company set up, so setting up for like a Woofy or setting up. You may need to do a JV with a local partner, a lot of tax issues. So I think a lot of this kind of administrative part of things is quite tough. >> And so are these problems specific to a foreigner opening a company, or the local would face similar thing? But just being local, they know about these things? >> I think definitely it's harder for foreigners. >> It is harder for foreigners. >> Even setting up a bank account, me being from Hong Kong I already have more barriers, and if you're not Chinese at all I think it's very difficult. >> How can they get any help? I mean like maybe are these for example the accelerator program or? Are there like government programs that would help foreigners going to China? >> I think there are government programs that exist. The accelerators definitely will help in terms of at least kind of hooking you up with the right people to help you out. There are definitely companies now that help you set up a foreign entity in China. So yeah. >> But it's still a big headache? More procedures than a local. And so would you advise them to have a local partner or, and if so how can they find a local partner? >> So I think the general advice is to have, I mean, it's ideal to have a local partner. But finding one, I mean finding a co-founder in the first place is extremely difficult. >> It's very hard, yeah. >> And then finding a local Chinese one is just making it exponentially more difficult. >> Right, the language barrier, the chemistry could [CROSSTALK]. >> Exactly, and there's a huge cultural difference, I think, and that's. I mean, the cultural difference will be in the details. So when you're coming up with agreements, how you're spending the equity. I think when you get to those more sensitive issues, I think it'd be quite a challenge. >> For these sort of issues, it's very hard to assess, right? We just meet someone and- >> Exactly. >> Until you come to the point where you're really testing the different values and cultural kind of view. >> And I think it's interesting because as a Chinese person, we'll tend to be more. Relationship difference, so we'd want to build a relationship, to understand who you are, trust you before we start talking about those things. But I think there might be a lot of Western cultures who are more like no, let's be black and white, let's-. >> Do everything back the book. >> Exactly, and lets figure it out right now. But as a Chinese person, I think there are many times people who would not trust you if you asked for that. >> Right, right. >> [CROSSTALK] One interesting cultural difference. >> There's a very big cultural difference there yeah. >> And what about investors? You have I think you have both, you said your family invested through the accelerator program, but I know you have also done other rounds. How was that experience of finding investors and working with them afterwards? >> I think, so starting with actually raising the round and finding investors, I think we got quite lucky because our lead investor was a friend of a mentor that was at the accelerator. And that mentor was in our industry so they were in marketing. So he lent a lot of credibility when he recommended us to our lead investor. >> Right. >> So, I think just one or two months out of the accelerator we already had our lead on board. >> That's considered fast, right? >> Yeah, I think that was extremely fast. And then from there we actually picked up one or two more just around that lead investor. People who might have co-invested or known to him. But then, we actually went to a period of time where we kind of struggled to find investors with bigger checkbooks. So we got many smaller investors and then at the very end we had a couple of investors who wanted to put in more money. But then because we already had all of these small investors we didn't have enough room to give them as much space. >> But that's a good problem to have at least, right? So now more people and more amount of money want to come in. >> I think it was a good problem. In hindsight, I think, I mean it's very hard to say and it's easy to look back. But I would have preferred to have probably fewer investors just to make it easier to manage, >> Right. >> And had more investors that are, I guess, more strategic, like more aligned with our industry. >> Right. But, in that case, I mean, in a way, what you described was lucky, but then it's because you have good reference and referral, right? But for someone just starting, how would you advise them where they can meet the potential investors? And do you think the investors these days, how they compare to outside China, are they more conservative or more risk-taking? Or more open? >> So I guess we have investors that are based in Hong Kong, China, and abroad. So we do have a bit of a spectrum. I think, I would say, I think in each market there are a spectrum of investors. There are some that are very traditional, they want the big business plan. >> Right. >> And then, there are some that are much more kind of startup savvy, they're very quick to put on a term sheet. They believe that whatever numbers that you come up with are unlikely to be realized. And so they're a lot more about experimentation. So I think that spectrum, from my experience actually exists in all of the markets, and it really depends on kind of where you look for them. So in terms of where do you find investors, I think we spent, the ones that got on board early on were the ones that we actually had multiple conversations with before. >> Right. >> So, I didn't have serious conversations about raising money. Especially because I thought, we might have been a non profit at the beginning. >> Right. >> So I just, I worked in a [INAUDIBLE] space and so there are sort of things that will happen and I'll just go and every now and then you'll meet investors during these events and also have a conversation with them tell them what I'm doing, giving them update and people would usually introduce you to other people. And at that point, we're just having quite casual conversations but I think what I didn't realize was, at the point where I was actually raising money and we had a bit of traction, I think that is important as well. >> Yes. >> But when we raised money I think that people that had not seen me, had not met me before. The heard the story and they watch the progression of the start-up. In that amount of time and I think showing that attraction kind of organically was very helpful to building that trust both and me and as a founder and for like, as for the business as well. >> Right, so by the time you find, you stop finding serious investor you already have some traction and of course that helped a lot. And you mentioned you also worked in a coworking space, right? How has that been working out? Is that a good experience? Is there any synergy, really, with other company residing in In the same place. >> So we've almost always worked out of a coworking space. >> Right, right. >> I think the biggest value in that is just taking so much time on administration. I'm not going to set up your own Wi-Fi, printer, all of that, all that work. I think another, so actually, as our business have evolved and we started, so we usually work with bigger agencies, marketing agencies, advertising agencies, and help them market to students. But now we've found that actually start-ups also want to acquire young users, so students are actually a good market for them or a good demographic. And then we found that, actually, they can be our customers too and so, now we've actually, yeah, use our cooking space networks to find customers as well. >> So, in that case, your business model has also evolved, right? To address a wider issue. And so, sometimes we hear people say that they pivot on something but now you actually seem to be expanding, instead. >> Yeah, I think, when we first started and we worked with more of the agencies they're more high touch, they need more custom service. But as we're building out the core product, we realize that there are some customers like e-commerce platforms or startups, like more tech companies or tech savvy companies. Who are happy to just self-serve, so they can use our core product without the extra services, so then we can charge them a cheaper price. So, now that we've done more and we developed the products more, we're able to offer that product in more segments. >> Interesting, because I think for a lot of start-ups, when you start off with doing something in one direction and then you just never know maybe. Some other thing that you can actually or even pivot to another idea and create more revenue stream, right? >> Yeah. >> So but a lot of time people say in China if you have a good idea people will copy your idea very quickly. Have you seen a lot of competitors coming out as a result? >> Actually, when we started in China we did see competitors. We've even seen bigger companies copy our platform, or at least it looked very similar to our design. But I think a lot of them didn't continue pursuing it, I can't say that we were a extremely fast growing business, so that could be part of it, that the market is not that easy to build. But I think another thing is that we as a company we're very mission driven. I mean, I started from a new background, a lot of the team were student leaders in the past. So they understand the pain of not being able to find resources to do a thing that you want as a student. So, I think we, there's a song like culture and within the company, to figure it out because we care about the students. Whereas I think the other competitors, maybe more, just optimistic, they see something in the market, they copy it. >> Right. >> They're not going to stick it out to make it work. >> Do you think that that is the key difference? In fact, that is your competitive advantage, right? I mean, so if someone just trying to copy your idea, but not with the passion of serving the customer's segment that you are targeting. Are you saying that is one of the key difference that why you stick around and then, they compare the status of it. >> I think that's definitely a big part of it. And it's reflected not just in our team and how many years we're willing to do this but also just in the way that our users stick with us versus other competitors. Because we're in one of our vows is student's first I think they really appreciate it. So we've gotten feedback from the students where they say it feels like you're actually working with us instead of you're trying to use us to serve brands, yeah. >> So the target, they know, they can feel the difference. >> Yeah. >> That's good, that's good. So that's why you are, I mean, have outperformed the competitor, I'm sure. So managing a company in China, let's say Hong Kong, right? You have experience in both, right? What are the challenges, in terms of now managing a company, running a company in China? >> I think the number one headache for me is administration is still a very difficult, I think in Hong Kong isn't very efficient if you run a company. Yeah, a lot, from a business services, the infrastructure is quite robust. And it's easy, things can happen very quickly, whereas, in mainland China, it still takes a long time. And, yeah, the processes are more complicated. So for me as, I guess, more of an entrepreneurial role in the team that's something that frustrates me, the operational side of things. >> Right, so the efficiencies and effectiveness sometimes on the operations side that's one of the challenges, and anything else? >> So the second thing I've found is finding the right people, so hiring and, yeah, I think finding the right cultural fit is tricky. And our company, especially, is very specific about the type of person that we're looking for. So what we found is, so yeah, it's funny that, I think the people we hired early on from mainland China, a lot of them work at small-medium companies. A lot of the people from Hong Kong that we hired, actually worked from bigger companies. But what I found was, as we kept going, the people that we found in Hong Kong were actually more suited to a startup environment where they're figuring things out as they go. As people that we had in mainland China, I think they were much more comfortable with executing something that was already working and it was very difficult. They struggled, I think, when we asked them to help figure out the business model. I'm not sure that, that's necessarily a cultural difference between the two sides. But, I think it's definitely, it has to find people who fit the right stage of the company. >> But, as you describe because the people that you hire in Hong kong have worked for bigger corporation. They're probably a little bit more understanding business in a way. Right, they have more experience as an employee or have worked in corporate. >> I think partly that might be it but another part might be that they also know what they want more. So they know that they don't fit in in the corporate culture, they spend more time Looking up what start ups need and what it's about. >> All right. >> So they're more prepared when they came in. And then, I guess also a bit more excited about the fact of having that ownership. And being directly influential in the results of the company. >> Now you mentioned your company is very specific in terms of hiring because the cultural fit that's important to you. But apart from that do you find a young graduate from China, are they excited about joining a startup or do you think? They're still like let's find a good comfort job. >> I think in general I feel like young people in China are a lot more open to the idea of working with startups, and- >> That's the trend now, I mean I'm sure if you talk about five, ten years ago probably more people would lean towards comfort so it sounds like. >> Yeah. >> It's more to us. [CROSSTALK] >> I think generally. >> Or more receptive. >> My experience is even when I was working in the NGO five years ago I feel like young people are in mainland China, are just more entrepreneurial. They're more aggressive, they want it more. Thanks to all again who I worked within Hong Kong. So in that sense actually as users we find it sometimes like easier to work with users and mainland China. Because I guess there's way more competition. So they're willing to put in more effort to get the resources and the opportunities. >> Interesting, so in that sense the supply of talent is probably not a problem given the number of graduate. And given now the attitude is also more receptive to startup. So the key difference would be like can you find a good match for it all boils down to that right? >> Yeah. >> What about like other things, if someone's coming from outside, going to China, right. What about running a business in terms of burn rate? Is it a very expensive place to start a business or to run the business? >> In mainland China? >> In mainland China. >> I think definitely not. Definitely cheaper than Hong Kong. >> Yeah. >> And depending on which city you're in it can be also significantly cheaper. >> So the barrier could be reasonable. So I'm just trying to thinking if a foreigner that go into China they would face this culture issue they'll face that opening company. But it seems like some of the good things that running a company would not cost a lot. >> Well I think, definitely talent is significantly cheaper. And again it would be very a lot. I mean the Tianjin cities that's growing up already. But definitely some theater cities which have talent growing that are very affordable. And then the cost of just infrastructure, like rent, both for the company and for your employees, would be way lower than someplace like Hong Kong. Or other big start-up hubs. >> Right, do you have any other advice for a foreigner going to China and start a company. Anything that they need to watch out and then what other probably the advantages or how should they start immersing themselves? >> I think probably it's useful to be able a clear competitive advantage as a foreigner. So we have also have non Chinese people working at our company. And what they do in the company is they actually are the sales and marketing people to the agencies. And because in our industry, and so in the agency and industry there actually are a lot of foreigners and so it becomes an advantage. >> Right. >> For them to be, share the same culture or same language. >> Right. >> It's actually easier for them to do sales than potentially a local counterpart. So if you have that kind of advantage, then that can help you win in China. But if you're trying to compete in something that a local can do better than you, then you really shouldn't be here, I think. [CROSSTALK] >> Right, so you're saying because, what you're saying is you need to have some sort strength that you can really play with. And in your case you do work with foreign brands as well as local students. So you actually need both but for foreigner coming in they better find that edge that they can really matter. >> They need to or else I don't think they can survive. >> Right, anything else that they should watch out or? >> I mean, I would go back to that point of joining a local accelerator. >> Right. >> I think, I mean started can be very long. If you can take three months to run an experiment and figure out whether it's going to work or not. I mean, that's going to save you a lot of time. >> Right, so the sort of experience the program would be a good place to help them try or? >> Yeah, to test the business and I mean a lot of infrastractures already in place as well. So you don't have to go through the pains of a lot of the registration and so forth. So I think if you're going to enter China with a new idea that's probably a good place to start. >> Right. Are they going to get a lot of help from the government or other, there's also lots of events and competitions. Can they benefit from those programs? >> I think there are some cities in particular who are welcoming foreign founders. But from my feeling, I see a lot of programs that are mostly targeting local Chinese entrepreneurs. >> Right, so thank you very much, it's been very very helpful. Thank you.
