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After three weeks in China, it's clear Beijing is Silicon Valley's only true competitor

After selling my startup, Shopkick, to SK Planet in 2014, and handing over my CEO role a year later, I packed up my 1- and 3-year-old sons and my wife Angel, and flew to Beijing, Shenzhen and Hong Kong for three weeks, hoping to better understand the Chinese startup world and its entrepreneurs and VCs.

I hadn't been to China in several years, but had almost moved there 12 years ago, so I was very curious what I would find. I met with two dozen startups, from very late-stage — including valuations of $20 billion — to pre-seed stages. I also met with a dozen VCs, two dozen startup entrepreneurs and successful angel investors.

I started at 30,000 feet with late-stage startups and investors, including a long breakfast meeting with the founder Xing Wang of Meituan — a highly valued Chinese startup at about $20 billion. Then I went to Series B and A, and met with startups like VIPkid and 700bike and VCs like Matrix and BlueRun.

Then I went to the seed stage, and met a Ph.D. in aerodynamics who is developing a new car electro engine with high-energy density. He demonstrated it to me from the trunk of his car in a subterranean parking structure in Beijing. I visited the hardware incubator HAX in Shenzhen, and met the ZhenFund on the VC side.

Inspired, I decided I needed to go even earlier stage — to the root of it all — so I went to see the idea and even pre-idea stage at Garage Café, and at the top-rated Tsinghua University's x-lab and SEM entrepreneurship program, where Peter Thiel happened to be giving a lecture on "Zero to One" right when I arrived.

As my trip to China drew to a close, I started to reflect on what we in Silicon Valley can learn from China. Here is what I found.

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1. Beijing will be the only true competitor to Silicon Valley in the next 10 years.

Beijing is not just a nice startup playground which might become truly interesting in a few years. This is the big leagues now. Startups can achieve massive scale quickly, because the domestic market is 1.3 billion people, which is four times the U.S. or European population.

An increasing share of these 1.3 billion people is actually targetable. In the U.S., 190 million people carry a smartphone; in China, it is more than 530 million today, and it will be 700 million or more in three years.

But a large market alone does not mean that a place will become a startup hub. it is the combination of market size and the extreme consumer-adoption speed of new services, combined with the entrepreneurial spirit and hunger for scale of Chinese entrepreneurs.

Beijing is the main hub where it happens. Here, entrepreneurs, engineering talent from the two top Chinese universities — Tsinghua and Peking — and VC money come together. Seeing the scale, speed, aspirations, money supply and talent here, I walked away thinking this will be the only true competitor to Silicon Valley in the next 10 years.

Yes, there are other hubs, such as Berlin, but the scale is different. (India is the only other possible contender here.) And it's good for Silicon Valley to have a true competitor, because it sparks impulses on how to evolve to the next level.

Let's look at speed, cloning versus innovation, and the entrepreneurial spirit of Beijing versus Silicon Valley.

2. We pride ourselves on being fast in Silicon Valley. Chinese startups are faster.

In Beijing, tales abound about the sometimes crass competition between startups, and the often not ethically acceptable...


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