CW Jumpstarting in Shenzhen?
Over the last few days I have been in Shenzhen having been invited to help in the design of a new joint initiative being backed by the UK and Chinese Governments. This is written on the flight back to LHR.
The UK-China TechHUB initiative aims to create innovation and business partnerships between technology companies in UK and China by encouraging collaboration and supporting market entry. The aim of the “Jumpstart” event was to allow businesses to take the lead and build a TechHUB roadmap from their demand perspective, through an intensive two-day “Ideas Hackathon”.
Key lead partners were the Shenzhen national Hi-Tech Innovation Centre (HIIC), a local institution which is part of the extremely powerful NDRC ministry in China, and UK Trade & Investment (UKTI). The UK group was made up of a variety of businesses – mainly in the Smart City/data analytic segment – more than 20 businesses in all, including locally based folk from BT and ARM.
Alongside CW, there were Alan Scrase from the SETsquared incubator network, and Gary Stewart, Head of the Wayra UK accelerator programme. Both of these organisations are, I am pleased to say, active partners with CW.
The process started with a plenary session of around 190 folk, mainly Chinese. The 50 strong cohort then focussed down on two days of intensive and facilitated group led activities with joint UK and Chinese teams developing ideas and recommendations, and then a third day of visits to the HIIC and other businesses – including the Ing Dan organisation – a one-stop-shop for IoT suppliers from design, prototyping, mass production and marketing into China and beyond.
I addressed the audience on the subject of innovation, commenting that innovation was global, was a “contact sport” and required regular face-to-face meetings – and also on the case for linking clusters and hotspots internationally (with lots of comments on the Cambridge cluster phenomenon and the importance of networking organisations!).
Further thinking was stimulated by parallel sessions on Smart Cities (with Professor Zhang of Tsinghua University), Incubators (with Wayra), Innovation (with Andy Chen of the ARM accelerator programme in China) and Legal issues Amber Qi of Huawei).
Then the hard design work began. The overall process was facilitated throughout by an organisation called Meme, and the groups was divided into teams of around 5 or 6 – joint UK and Chinese. Much of the activity was supported by large whiteboards, and at times professional illustrators. It was busy and a lot of fun. Many of the companies also sustained useful business discussions, and the inevitable MoUs were signed.
I have long been interested in the possibilities of developing meaningful ties of this kind with China, and particularly with Shenzhen. The process was fascinating, and there is considerable potential for this to be a useful route into the China market for CW members, and also a showcase for CW member expertise.
It is the home of many of China’s technology giants (Huawei, ZTE, Tencent, Mindray, BGI). According to HIIC there are around 30,000 technology businesses in Shenzhen. It is a focus for IoT innovation in China. It has 8,000 VC institutions. It produced 48% of China’s patents in 2015. There are 1283 innovation entities (i.e. research centres, laboratories etc.). It holds 20% of all global patents on TD-LTE. Much of this is set out in the latest edition of WIRED magazine – which couldn’t have been more topical.
Over the two days a vision developed of a Tech-Hub becoming a self-sustaining a membership based organisation, with a physical presence, drawn from a wide number of stakeholders, and able to deliver carefully and competitively selected UK companies through accelerator programmes, while providing easier access to legal/IP services, market intelligence, investors and partners. It was felt the organisation should be able to survive free of public funds after three years.
- China is not an easy market for UK start-ups. It is not for the faint-hearted. The sheer scale of the market is such that small companies can be written off as simply not up for the challenge by potential partners.
- The sessions highlighted cultural differences, with the UK side challenging and collaborative, while the Chinese tended to hold back and sometimes had to be coaxed to really come up with their opinions. Co-production is challenging. The central importance of Government in China, and the long term vision they have for sustained initiatives delivered at pace, can sometimes contrast with UK reticence around the role of Govt in business.
- The Chinese side seniority fell away just a little during the second day. One got the distinct impression that we needed them more than they needed us!
Above all execution and pace will be absolutely vital. It falls to UKTI and the HIIC to put flesh on the bones. A key issue will be the appointment of an effective local head within Shenzhen, and ensuring that sufficient funds are in place to deliver the necessary pump priming.
Certainly the initiative can now go ahead with considerable momentum.
CW will be watching with interest how this develops, and letting members know about opportunities as they arise. Certainly if any new organisation is created to help UK technology companies enter the Chinese market, I think Shenzhen is the right place to locate it.
Written by Bob Driver, CEO of CW (Cambridge Wireless)