Does China’s Innovation Have A Chance?

Earlier this month I visited Beijing, China’s massive capital. I was invited to speak at a conference hosted by the elite Tsinghua University. The topic of the conference was innovation, makers and students. In just a few days I was instantly submerged into a whole new culture, very different than my own, in almost every aspect.

Welcome to China

Although I’m well traveled in Asia, it was my first visit to the mega-nation of the world. My first impression was “whoa, this is cold”. After landing, the air outside was around -10C, magnitudes colder than my local climate in sunny Tel-Aviv.

Next was the smog. I’ve read enough Beijing-Pollution articles to be prepared, but it’s not until you see it up close you understand how powerful, lethal and downright depressing the pollution actually is. I’m focusing on this because this is one of the biggest problems China needs to solve, and fast. The government doesn’t know what to do, and it might be up to the young students to find the innovation to put an end to the suffering.

China — Time for a Reality Check

The day before the conference, I had dinner with Prof. Benjamin Koo, the organizer behind the event. Listening to Prof. Ben talk about the serious issues his country faces in terms of (lack of) innovation, top minds leaving the country for the west as well with his plans on giving the ecosystem a jump-start was mind-blowing and inspiring together.

His vision was set — he believes innovation needs to be rooted at a young age, with the university demographic ripe for this mission. He wants Tsinghua to set an example to the thousands of colleges and universities in China. The final goal: nation-wide plan to unleash China’s high potential into actual innovation.

Time to Talk

The next day, before the actual conference, the 15 or so speakers that had flown in from around the world, had a four-hour closed-door power talk. The topics on-the table were innovation, universities, hackerspaces, startups, legal issues and motivations.

Some of the more interesting topics were “Do we encourage students to create for-profit businesses or any project they like”, “Does the university take equity / invest in the ideas later on?”, which triggered heated arguments from the different participants.

The diversity of the group was interesting: It would be hard to say it was homogeneous. We had people coming from the USA, France, Brazil, China, Israel and the ages varied from 23 to around 55. Everyone has come from a different background, but what everyone had in common is the fact they were experts in their area of innovation. Makers, designers, programmers, entrepreneurs, professors, lawyers, we had it all.

The event, Tsinghua Maker’s Day, was celebrating their 2nd year running. This time — within the new iCenter building. This impressive building would be the foundation of the “hacker” culture in the university and would provide students the resources and ability to express their creativity. Spanning over 6 floors high, the building provided labs, programming stations, 3D printers, tools and whatever else was needed to the students.

The event started, with around 200–300 local Chinese in the audience. A few key university officials spoke and the International speakers spoke on different panels. I spoke on how students can truly create game-changing ventures. When the talk was directed to the social economy, was surprised with the amount of hands in the air when I asked “Who here knows AirBnB?”. The number of hands, roughly representing 1% of the room, demonstrates China’s massive potential as a market where many “unicorn” ideas are not implemented at all.

Why the Numbers Make Sense

So why is Tsinghua and China investing so much in student innovation with these fancy hackerspaces? Because it’s smart! Let’s run some numbers and I’ll be easy with them.

Number of universities in China: 2,000
Numbers of students enrolled: 6,000,000

Let’s say that 1% of these students, which are now only studying, start working on side projects, that can later turn into businesses.

Number of Ventures Started: 60,000

Let’s give each venture a 1% chance of success. With success defined as reaching a valuation of $50M or above.

Number of Successful Companies: 600
Total Valuation of Companies: $30,000,000,000 (30B)

So yes — China needs to start making more hackerspaces and fast!

Summarize — Why China is Awesome

At most events, timing of speakers and events is critical. China is no different. What is different is the fact that instead of holding up polite signs of “2 Minutes Left” to flash the speakers, they like doing things the fun way. After hearing I served in the military, I, and a few other speakers were given Nerf and Air-Guns. Our orders were simple, shoot the speakers who over-spoke. Awesome.

Photo Credit: The talented Mitch Altman