$1 billion borderless startup model and the rise of Sinofy
The following article is proudly written in partnership with Abbey Heffer (Sinofy Advisory Board Member), Vincent Bonhaume (Sinofy`s Chief Content Officer)
Far too many digital pages have been devoted to the vast and varied ways COVID forced businesses across the globe to adapt and redefine the meaning of office work. The pandemic may have brought the transformational kick-in-the-ass many companies needed, but the changes that this harsh, sudden reality has brought, were already in motion well before the coronavirus made the leap from beast to people.
Though the 2020s may well bring about the death of the centralized, office-bound workforce, we are also witnessing the birth of a new breed of borderless startup defined by rapid growth and unprecedented mobility — and that’s the good news venture capitalists have been waiting to hear.
Remote work is redefining productivity, growth, and profit
The story of borderless startup pioneer Sid Sijbrandji gives new meaning to the term Unicorn — startups valued at over $1 billion. When he first launched GitLab in 2012, CEO Sid Sijbrandji was his own first and only employee, and his headquarters were a home computer in the Netherlands.
His first hire was a Serbian engineering fellow based in Ukraine. When Dmitriy Zaporozhets joined Sijbrandji as co-founder, the two-man team recognized the efficacy of eschewing the traditional, centralized workforce.
100 companies, and has attracted investment from some of the biggest names in the game, including Goldman Sachs. More than anything, GitLab shows that the startups of today are no longer restricted by the brick-and-mortar traditions of their predecessors.
And why should they be when their clients and their client’s clients are becoming increasingly mobile online. The UN Conference on Trade and Development has estimated that global Internet traffic in 2022 will exceed all Internet traffic before 2016. According to this same report, after almost two years of offline restrictions in freedom of movement, travel, and physical work, online activity has increased faster than ever predicted.
These changes, and the speed at which they are occurring, not only change how we work, but how all industries function. Even the most fundamentally human-to-human of industries are implicated: Art, photography, film, music, and publishing companies have struggled to adapt without the institutional and legal support systems in place to navigate this brave new world of high-technology, high-pressure change.
ome countries are more digital than others
There are more than 900 million internet users in China, constituting the world’s largest, single internet market. High levels of internet penetration mean potential and existing Chinese tech unicorns have the power to shape not only netizens’ consumer choices, but their lifestyles both on and offline. Tech giants like Tencent’s WeChat have increased the efficiency of hospital systems, driven more than 300 billion RMB into travel, food, shopping, and tourism industries, and dominated even offline payments.
Chinese tech giants aren’t just about creating smart devices or novel internet services, but rather about creating entire ecosystems connecting online and offline life. Alibaba is more than just a series of online shopping platforms; it is a “community of organisms” providing all the resources an online business needs to connect with real-world buyers and systems. In a nod to this overwhelming impact on Chinese people’s lives, the government recently threatened regulatory action if tech giants like WeChat and Alibaba continue to block one another’s links on their sites. Even under the heavy regulatory eye of the Chinese government, tech companies are redefining everyday life in China.
And the world is following China’s lead. With almost 200 million Chinese outbound travelers leaving the country each year, Chinese digital products, such as payment systems and apps, are being adopted worldwide. In 2019, more than 400 million people traveled to China during the Spring Festival, Chinese New Year. Even in the United States, 23% of all internet users use WeChat, China’s infamous all-in-one app, which platforms mobile payments, work and organization apps, instant messaging, and more.
Many of the technologies now edging out their global competition were developed with the Chinese user in mind. Even the creative industries are following this pattern: Hollywood movies will feature famous Chinese actors and actresses or involve scenes set and filmed in Hong Kong and the Chinese mainland.
And yet, despite China’s overwhelming tech dominance and rising cultural prominence worldwide, very few entities and professionals boast in-depth knowledge on how the Chinese internet and its technical infrastructure has developed over the last two decades.
Though the Made in China 2025 policy focuses on industrial innovation and upgrading, its biggest side-effect has been an unprecedented boom in internet-based innovation. The “Made in China” brand has been remade, not by digital innovations on the factory floor, but by highly mobile and versatile internet and tech unicorns like Xiaomi, Alibaba, Tencent, Meituan, Bytedance, Pinduoduo, and dozens of others.
In amongst all this innovation, Chinese unicorns are conquering global stock exchanges, competing with established tech companies from the world’s wealthiest countries. Of the Top 25 largest internet companies worldwide, nine are Chinese.
Every day, millions of Chinese citizens use online platforms for their offline lives: To book cars for transportation, scan codes to ride shared bicycles, to order and share food, the list goes on. China’s domestic market is one of the most lucrative worldwide, and yet Chinese investors are still looking overseas for investment options. This is because, while innovation is happening domestically, it is not enough.
Venture capital and the rising Chinese unicorn hype
In just the first half of 2021, the value of VC deals had almost outpaced the pre-pandemic annual total for 2019. According to Pitchbook, the region’s capital investment reached $56.0 billion across 2,366 deals — on pace to break $100 billion by year’s end.
Even more dramatically, the VC landscape in Greater China has seen unprecedented growth as scores of investors based outside of the region have flocked to it.
For example, Sequoia Capital and Lightspeed Venture Partners have established teams and fund entities aiming to invest in promising companies based in the region. For many VCs, investing in Chinese startups represents both a paradigm shift, given the sheer operational scale and speed of the region’s innovation economy, as well as an opportunity to invest in first-in-class startups in a rapidly growing market.
Everyone wants to find the next Chinese unicorn, but while overseas investors flock to China to do so, Chinese investors are looking to become the next unicorn by acquiring startup technology and know-how to adapt for Chinese consumers. The mobility and speed at which Chinese capital can move in shaping and giving birth of Chinese unicorns.
Take Xiaomi, for example, when physical smartphone sales were down almost 50% in 2016, Xiaomi began aggressively investing in internet and tech startups, creating a Chinese startup “ecosystem”.
Xiaomi is remaking the terms upon which investment is made by developing startup “ecosystems” around the world. And it is far from the only Chinese company with readily available cash to invest in new tech. For Chinese capital, this is not a matter of money, it’s a matter of acquiring tech, collecting intellectual property, and localizing innovation for a domestic market worth billions.
Chinese unicorns and tech startups show how socially-minded internet services, like bulk online shopping defined by human-to-human interaction (Pinduoduo) or viral social media hypes (Bytedance), tailored to the Chinese user can redefine internet usage worldwide.
Chinese investment is not only breaking records but also challenging the status quo. Where giants like Alibaba at first followed the established investing-in-the-US route, it is now diversifying and investing in South and Southeast Asian startups.
With its fintech arm, Ant Financial, Alibaba is disrupting the startup landscape across the developing world. And, as the Pitchbook Greater China Venture Report says, disruptive startups are taking advantage of building their businesses in a region served by both the most populous country and the second-largest economy in the world.
However, most non-Chinese startups don’t have the network or know-how to navigate this fast-paced, aggressive venture capital landscape. The first step towards remedying this situation is to make sense of China and APAC’s rapidly emerging tech landscape, and this is where Sinofy and its partners come in.
The birth of Sinofy and making sense of China and APAC’s rapidly-emerging tech landscape
Sinofy was born on September 23rd, 2020, during a global pandemic that forced organizations of the world to consider radical transformation. The pandemic also forced me and co-founder Maximilian Kobernik to consider the serious knowledge gap preventing tech companies from taking advantage of the rapid development of China’s online services market.
Sinofy combines the borderless potential of the $1 billion remote-working business model and the absurdly-lucrative business of localizing international tech products for the Chinese market — sinofication.
In less than three days we had our website up and running, domain purchases, and an initial list of potential clients within our network ready to test-drive our services free of charge. In less than three months, we had ten associates, including two rising stars who serve as our Co-CEOs at Sinofy today: Levi Liang and Nastya Adamova.
What started as a PR agency soon evolved to offer fundraising, virtual roadshows, an R&D center, technical recruitment and workshops, and eventually, our own in-house decentralized finance products.
In less than a year, we have helped 50 clients with their tech needs, incorporated offices in seven different countries, hired more than 100 new team members — all of whom work remotely. Despite the fact that most of us have never met in real life, we have developed a family-like working environment that has weathered ongoing challenges, global uncertainty, and time differences.
With each step towards a more powerfully decentralized remote working environment, the more the influence of GitHub’s philosophy became apparent.
Despite our physical distance, age, ethnic or academic backgrounds, languages, and industries, the Sinofy team has proven highly collaborative and capable of getting shit done.
But what does this borderless startup look like on the ground?
Our ability and know-how when it comes to operating entirely online as a borderless startup means we are perfectly positioned to bring technology — and funding for that technology — together across countries and continents. We offer solutions to help localize, fund, and build tech products and services that call for action, and our cross-border network of venture capitalists, technology experts, and consultants across 20 countries and 12 languages are always on standby mode to ensure the delivery and assistance whenever it’s needed.
Earlier this year, Sinofy co-organized and participated in the World AI Conference in the context of EU Online forum in partnership with Expand Digital, which saw over 400,000 attendees and more than $100 million in investment deals brokered between 324 AI companies.
More than 100 companies were funded and 13 new products were launched at the conference. More than 1200 speakers joined more than 100 forums across 160 roadshows, all before an audience that racked up over 385 million views. (the detailed article is here)
Sinofy co-organized a 5-day international summit that is taking place as i am putting this article together, the event is being held between Oct 11–15 bringing some of the best minds in the blockchain industry to share and discuss current and future developments.
Sinofy has teamed up with organizers Colibri Group, Coindar and Xangle.io to welcome 50,000 participants, more than 100 international partners and 60 representatives and regulators from digital asset platforms to the summit, which seeks to unify the crypto community.
There is one more thing:
We_Challange Hackathon powered by Sinofy and Partners is taking on the most complex tech helping companies worldwide remotely reducing their cost, increasing productivity, providing outsourcing as well as outstaffing solutions.
Since 2012, we have held 108 events, with over 200 clients and participants across 20 industries.
Our Dev teams compete to develop the most cutting edge solutions for our partners and clients, some of the notable honorable clients include Facebook, UpWork, Intel, Vodafone, and dozens of others that are described in the deck here.
Furthermore, the list of judges and their accolades is a manifestation of the quality based on which Dev Teams are tested, judged and rewarded, thus, surprising our clients and partners not only by the speed and precision but also, but productivity and energy during and after the event.
Interested in a partnership? Say hello to Nastya Adamova or Kema Bae.
2021 in a Nutshell:
Sinofy is only a year old but with 100 employees, partners, and representatives across 20 countries, speaking 12 languages within 5 offices worldwide, a lot has been done. Our one-stop solution combines twelve services to allow tech companies to take advantage of not only the Chinese market, but Southeast and East Asian opportunities too.
Today, as we launch our new website and an updated deck, we’d like to invite you to learn more about our story, and decide whether or not it could be the beginning of your own.
None of these achievements would have been possible were it not for the assistance of our key team members. I would like to thank Nimarta Verma, Stephane Laurent, Peter Kozlov, Gerda Repsyte, Natalia Shupeyko, Cecilia Wong, Paolo Ottaviani, Sophie Dale, Alex Beattie, Rostyslav Pelekhovych, Tatiana Vasyanina, Pauline Bayle, Najoua C, Cathrine Zhou, Martin Zhang, Bayina Menkeeva, Kema Bae, Niamh Dohert, Adi Weitzhandle, Lana Fayzullina, Alexandra Prieto , Nina Kulchevich, you all for throwing your heart, time, and effort into making Sinofy the truly global management consulting firm it has become over the last twelve months.
I also deeply appreciate the support of Giovanni L.Bordone, Khalid Howladar, Weilong Wu, Naquib Muhammad, Diana Hakobyan, Alexander Prudnikov.
