(Chinese Version)

Recently, some entrepreneur wrote an article to share his or her own experience looking for angel investment in Guangzhou and Beijing. The author used a very strong language to tell the story and eventually cracked open the investor community in Guangzhou. Like many others who care for the startup scene in Guangzhou, I am also very concerned about the very situation Guangzhou is in right now. We just don’t understand how Guangzhou, the third largest city in China, could have such a bad investment environment even though it has one of the most active economies in China.   

The concern for Guangzhou’s startup scene seems to be mutual among many. Not long ago, another article titled Why Guangzhou Isn’t Making Much Progress In The Internet Startup Scene appeared on TMTpost and once again brought up heated discussions about the future of the startup scene in Guangzhou.

Cantonese, who are famous for being extremely pragmatic, or, practical, are as a matter of fact lagging behind others in this great startup era. Now it seems to be the darkest time for Cantonese entrepreneurs, and the situation is desperate.

It’s apparent that the startup community in this great city is not doing well in many aspects and the situation is generating and projecting a lot of negative energy to entrepreneurs. This horrible situation is making people think about possible ways out and reflect on this very matter. It’s possibly the best thing that these critical articles can bring about. However, what I want to discuss about in this article is the possible solution to this problem.

So, is there any way out for entrepreneurs in Guangzhou?

For a long time, the Guangzhou municipal government has been the representative of the very spirit of Cantonese people, that is, being pragmatic and practical, which contributes a lot to the actual improvement of Guangzhou people’s everyday life. It makes the people feel comfortable and see progress in their lives, there’s no doubt about that. But in terms of the development of industries, this spirit is actually holding this city back. Being practical and pragmatic inevitably leads Guangzhou to focus more on investing in traditional industries. That being said, Guangzhou neglects the development of the Internet industry, which happens to be today’s most prosperous and fastest growing industry.

While the startup scene in Beijing is blazing with flames and Shenzhen is also on fire, attracting the attention of the pearl delta region and the whole country, Guangzhou is still focusing on traditional industries that can bring a high volume of GDP to the city. In Guangzhou, each district has its own strength: Luogang District is known for its bioengineering and pharmaceutical industry and traditional manufacturing industry, Tianhe district is a high-tech industry hub and home to many Internet giants, while Haizhu district focuses more on the e-commerce industry. It’s known to all that traditional industries that can bring great economic benefits get more attention in Guangzhou. As for startups, however, it’s a completely different story.

Yangcheng Evening News, Guangzhou Daily and Nanfang Daily, the three influential media outlets that are based in Guangzhou, haven’t been helping to reverse the situation so far. For one thing, it’s probably they just don’t take the startup scene in Guangzhou seriously. For another, perhaps they just don’t pay any attention to the development of the startup ecosystem in Guangzhou.

In Guangzhou, the local investment community is too weak to make much improvement on the situation since they are a few and they don’t work together. Investment organizations and individual investors only appeal to the mass through some we-media accounts, which have only a small number of followers to begin with. The outcome was predictable, all the efforts turn out to be in vain.

Ultimately, Cantonese people are trapped by their own ways of thinking. While being open-minded in diverse cultures, Cantonese people are rather conservative and traditional when it comes to doing business. Traditional trading business is what they are good at. Yes, they can be that simple-minded as well while being a famous business group nationwide, or even, worldwide. And because of that, they don’t care for the current industry tendency, which is, business ecosystem, and new business models that much. These ‘new stuff’ just seem too unrealistic and they would rather do something ‘practical’, which is to produce and trade. The overall situation has led Guangzhou to where it’s at today.

Where’s the ideal place for entrepreneurs in Guangzhou to grow and gain momentum?

I have been thinking about an Utopia of startups in my mind: it’s a place in Guangzhou where you can start a business without any preparation, a place where you can find people alike, where you can meet potential startup partners and investors and learn different knowledge and real-life entrepreneurial experience from other people.

But where exactly is this place? Under the Canton Tower? The Yangcheng Creative Industry Zone? Or the Innovation Valley? Well, they could be the ideal places while at the same time, don’t seem to be promising. Perhaps different people will have different answers to this question.

At one time, the provincial government of Zhejiang province built a Dream Village, a small town that’s constructed and led by the government, in hopes of attracting more private organizations that support startups and forming a startup community. The Dream Village is also expected to build a local startup ecosystem of Hangzhou.

In Shenzhen, we have the Startup Plaza, which is also constructed and led by the government. And it attracted many private organizations to set their footholds there. Startup service providers such as the Innovation Valley, 3W Café, Lenovo Star, Chaihuo Maker Space, and Feimalv etc. and the investment community behind them are making a Shenzhen miracle in this particular place full of talents.

How about Guangzhou? It’s said that the government is currently pushing the construction of industry zones. But what Guangzhou is doing is actually quite different from that of Hangzhou and Shenzhen. Guangzhou doesn’t want to attract more startup service providers, but get all the Guangzhou-based Internet giants in one place to share the glory they have created. Instead of nurturing new startups, Guangzhou is apparently more interested in the existing giants.

Officials of the Statistical Bureau clearly only care about the GDP and focuses on making Guangzhou the top in terms of the statistics and numbers. They are, in reality, compromising the future of Guangzhou by only seeing the present. Such poor management can’t really keep enough talented entrepreneurs in the city. I believe that the complex procedure to register a company would scare off quite a lot of entrepreneurs already.

It’s certain that traditional business trading industry is a crucial part of Guangzhou’s industry layout and it has undergone transformation as the Internet evolves and online businesses grow reliant on e-commerce platforms such as Alibaba. Traditional industry workers are now standing at a crossroad and they need to make changes accordingly as traditional industries transform with the development of the Internet. Guangzhou will definitely need a great number of innovative talents to drive the city forward.

But Guangzhou has lost the innovative spirit. Many entrepreneurs in the city left for either Beijing in the north or Shenzhen in the south, leaving a great talent shortage in Guangzhou behind. Guangzhou needs talents to make the transformation and upgrade traditional industries. But where can Guangzhou get all those badly needed talents in the future? Maybe when this very day comes, we will finally realize what kind of trouble we are in right now. Without talents, no progress can be made.

What can I do, as a person who cares about Guangzhou?

Maybe we will need steady growth before blossoming. Guangzhou has been one of the most important cities ever since the reform and opening up policy was carried out in the 80s and it boosted the country’s economy in many levels. We can’t deny what Guangzhou has done and is still doing for the country. In this new wave of Internet startups, the Internet industry is shaping traditional industries and changing the rules of the grand game. People who love Guangzhou and share a mutual affection for this great city want to make a difference for the startup scene here. Whether it’s individuals, the government, or other private organizations, we all want the best for Guangzhou. We want Guangzhou to find a way out of this situation and rise to be on top again.

Young entrepreneurs need mentors to guide them. Experienced and seasoned entrepreneurs from industry giants can stand out and share their wisdom and personal entrepreneurial stories with the young people. Perhaps an open class for them will be great. It would be a great opportunity for young entrepreneurs to get inspiration from whom they aspire to and all those experienced talents around them.

The office space the government offers to the Internet giants can be turned into incubators, serve as important infrastructures for startups to grow, instead of letting the village committees in Guangzhou’s urban villages make them into cheap office space. Perhaps entrepreneurs in Guangzhou should have a physical space where they can get together and mingle and have effective communication without having to go though different districts, just like what entrepreneurs in Beijing and Shenzhen have.

[The article is published and edited with authorization from the author @Naokebang, please note source and hyperlink when reproduce.]

Translated by Garrett Lee (Senior Translator at ECHO), working for TMTpost.