5 days in Shanghai and in Hangzhou to learn about innovation and entrepreneurship in China and create and present a business idea. Challenge accepted by 30 students from the Fernfachhochschule Schweiz !

China’s rapidly evolving and always innovating economy is finally starting to turn heads. Many veteran western entrepreneurs still see the Chinese market mainly as an outlet for their products and services. They neglect to recognize its importance on the stage of world economics. Fortunately, the future does not belong to them. Universities are motivating their students to look east in order to witness the wave of innovation that is sweeping the Chinese business scene.

The past week we, from ICL, had the honor to welcome such a group of students from Switzerland in Shanghai. Our main goal was to introduce them to the China they did not know. The experience was eye-opening for them and a moment of reflection for us at ICL. It made us realize that we witness innovation as it happens and become used to it so quickly.

Why FFHS came to Shanghai? 

We welcomed a delegation of students who were in the process of gaining their Masters of Science in Business Administration. Their focus is double sided. They try to keep up with the innovations that the age of digitization brings about. In the mean time they try to come up with ways to implement such innovations in an existing business structure. Shanghai was the perfect place to witness how this already happens perfectly.

Another reason for choosing Shanghai was the possibility to let the students communicate with other successful foreign but also local entrepreneurs. Through communicating they could discover what it takes to do business in China as an outsider. On top of that they could make a first attempt at overcoming the cultural boundaries between China and Switzerland. The ultimate goal was of course to make the prospect of going into business with Chinese entrepreneurs or on the Chinese market, more attractive. In our efforts to conform to their needs, we came up with a busy yet enticing excursion program.

As this was part of their Future and Innovation Workshop, the students had to get some work in as well. Upon arrival, each student individually had to pitch an idea that could be developed into a start-up business plan. These ideas were discussed by the teachers and those with the most potential where selected. The students were then divided into smaller groups and given one of the earlier pitched ideas. This became their start-up concept which they had to further develop and give a final presentation about at the end of the week. They received their business idea at the start of the week so they could take in and maybe implement some of the innovations they discovered during their stay in Shanghai.

The Workshop Schedule 

Monday

Monday morning was dedicated to letting the students get acquainted with their temporary working space. We had arranged an open office area at Distrii co-working office where they would work on their personal projects. After a small tour, some hours to work on their projects and a traditional Chinese dumpling lunch it was time for the first set of company presentations.

On Monday afternoon we were invited to the Shanghai offices of Swissnex, a company which mainly consults and helps Swiss companies to do business in Shanghai. As technology is king in China, Swissnex mainly works with Swiss startups who are active in the fields of AI and robotics. They provide them with logistical support which enables them to do business in Shanghai. Swissnex also strives to create relations with industry leaders they can learn from and a market on which they can offer their products. They mainly function as a mediator between Switzerland and China and ensure that Swiss startups can benefit from the positive relation between both countries.

Our first speaker at Swissnex was Dr. Felix Moesner, the China Swissnex CEO. He explained how the digital revolution has already reached a different stage in China, compared to the rest of the world. Many governments and entrepreneurs still keep their eyes closed to the evolutions China is going through. They still see China as a copycat market rather than a creative one. Mr. Moesner highlighted the importance of not making the same mistake and to take advantage of the innovations in mainly the field of technology, but also any other industry.

Mr. Luthi explained how Switzerland was one of the first western countries to recognize the PRC as a free market economy back in 1950. Besides recognizing its economic status it also engaged in a diplomatic relation with the PRC. In 1980, Schindler Elevators was the first western company to set up a joint venture with a local Chinese company.

This past and present mutual economic cooperation enabled Switzerland to become the third largest trade partner of China, only after the EU and the USA. Being ranked as number one in the Global Innovation Index 2017 for the seventh time in a row, Switzerland recognizes other leaders in innovation. One of their main goals of this economic partnership is therefore also to benefit from each other’s innovative research. To ensure that this productive cooperation is maintained, both countries signed a free trade agreement back in 2013. China’s goals for 2025 are to become a global high tech manufacturing superpower. With only 7 years separating ourselves from this date, the Swiss consul wants to ensure that Swiss companies can benefit from these technological innovations as well as contribute to the evolution.

Our third speaker was Michael Lehman, owner and GM of Sim. Sim is a consultancy company which helps European companies to get into the Chinese market. It also works the other way by helping Chinese companies to do business on the European market. From financing to project management and everything in between, Sim will assist you in every way possible. They mainly focus on promoting Switzerland’s major export products: high-tech, education, sciences and environment sustainability.Their goal is to establish bridges between Switzerland and China, something which they attempt in other ways as well. Michael is also the main organizer of Swissweek. This is a large event where Swiss businesses can present and promote their product or service to a wide Chinese audience. Many see this as an amazing opportunity to find potential investors or partners.

With over 10 years of experience, Michael gave our Swiss delegation some tips and insights on what it takes to do business in China. He presented us with his 3P rule: Patience, Persistence and Perseverance are his keywords to be successful as an expat in China. Because the market is always changing, expats need patience and persistence to hang in there and bite through whatever inconveniences arise. The Chinese business scene is a hard one to penetrate but once you persevere you arrive at what Michael called his three E’s: Enjoy, Evolve and Experience. It might take you a few months or even years, but you will become a better entrepreneur once you have mastered the professional scene in China.

He also emphasized that no matter what you have heard about China, their industries are still in development. There is still room for you to do business and benefit from their rapidly evolving economy. Michael wanted to install a sense of eagerness with the Swiss professionals in which he certainly succeeded to some extent.

Finally we listened to Bastien Dumont, the co-founder and CEO of ICL, who explained what the reasons were behind starting this company and what its goals are.

Bastien explained how he, like many other Europeans, felt uncomfortable at first at the idea of working in China. There is a certain fear rooted in the minds of Europeans when one entertains the idea of collaborating with Chinese entrepreneurs or relocating a business to China. After a first visit to China, Bastien quickly discovered that these fears were completely unfounded and that a large part of the world was missing out on what is happening over the Wall. Not only culturally but definitely also business wise, there were so many lessons that could be learned in China.

Bastien also opened up on the difficulties he encountered while doing business in China. One of them is finding reliable business partners that can help you create important connections. The fact that he started doing business here at a young age, didn’t make this any easier as well. This is something you have to take into account when coming to China for business. Your professionalism will be judged depending on how old you are. It’s therefore important that you overwhelm potential partners and investors with a thorough preparation. Last but not least one should stay aware of the constantly changing Chinese administration. You should never assume that you have something completely figured out as all regulations are prone to constant change. Keeping your eyes and ears open is a necessity when you decide to start a company in China.

All of these insightful speeches combined with a small drink at the end provided the students with a great first taste of what the rest of their stay in China would be like. The people at Swissnex did an amazing job at organizing the event and reassured the student delegation that it’s not uncommon for Swiss professionals to dive into the Chinese market and resurface successfully. Because China still is the great unknown, this was exactly the welcome they needed to fully prepare themselves and open up to what they would hear and see later on during their excursion.

Tuesday

 On Tuesday the students focused on their individual projects. Their schedule for the rest of the week was meticulously planned and filled to the brim with learning excursions. It was necessary to dedicate a full day to their personal projects so they could come up with the major outlines. With the strong foundations of their potential start-ups planned out, they could spend the following couple of days taking in all of the new information and plan how they could potentially implement this new info into their own start-up project.

This was also the day for the students to rest up since the upcoming ones would involve a lot of travelling around with not a lot of moments to relax.

 Wednesday

One of the goals of this trip was to show the FFHS delegation that innovative business centers are popping up all over China and not only in the major cities like Shanghai or Beijing. That’s why the Wednesday was dedicated to visiting Hangzhou. This second tier city is making a strong push to be recognized as a major player in the technology industry. Also known as the Chinese version of Silicon Valley, a visit to this tech capital was indispensable for students interested in the rising digital innovation in China. Several company visits were planned which would each highlight a different usage of new tech developments.

Our first stop was the niHUB Innovation Center, founded by the Swiss entrepreneur Lucas Rondez. Lucas explained the highly attractive environment in Hangzhou which lures in many foreign and domestic entrepreneurs. The Hangzhou government is pulling out all the cards to quickly raise the esteem of this city which was in the past only known for its green surroundings. They are offering tax and other direct monetary benefits to companies who decide to settle in Hangzhou’s tech-valley. This approach is rapidly turning the city into a technological hub where companies can share ideas and benefit from them.

NiHUB’s goal is to mainly help foreign businesses to gain a foothold in the Chinese market by introducing them to Chinese investors and corporations who could make use of their technology.

Lucas was of great help throughout the rest of the visit to the city as he accompanied the delegation and answered all of their questions concerning foreign entrepreneurship in China. His insights were highly valued by the students and teachers.

Our next stop was at PingPong. A fintech company that was founded in New York but quickly realized that it if wanted to gain international relevance, it should relocate to China. After the headquarters were moved to Shanghai, they really started booming.

PingPong offers easy payment options for Chinese merchants who want to sell their goods and services to an international audience. They mainly assist in converting foreign currencies back to the Chinese local currency, the Chinese Renminbi. Their speedy service ensures a merchant that his payment arrives within 24 hours. Online and mobile payments still sound like science-fiction to many European consumers. It was therefore really interesting to hear how deeply rooted this system already is in the purchase behavior of the Chinese merchants and consumers.

Next to technology, Hangzhou is also famous for the beautiful West Lake. A visit to the city would not be complete without a stroll alongside it. Escaping the high-tech world and taking in some fresh air could not be done at a better location than the West Lake. It was also the perfect background to take our extensive lunch with typical dishes from the Hangzhou region. After we indulged in all the food and beverages, it was time to hit the road again.

After lunch we made our way to Enjoyor, a company specialized in the development of AI technology and big data analysis. They specifically develop turnkey technology that is meant to be used in dense urban areas. We were able to witness which aspects of the daily life already or will soon be calling on their services. Facial recognition, smart educational tools and advanced medical technology to assist the patient in self-diagnosis were only a few intelligent turnkey solutions we were able to witness. The tour at their campus was a fine example of how quickly and efficiently innovation is being implemented in the daily life of the Chinese people.

This was a true eye-opener to many since we saw direct ways in which urban intelligent tools are being used directly. AI is no longer science-fiction technology or a fun gizmo you see on big conventions to draw crowds. It is a vital part of China’s challenge to come up with forever evolving ways at directing the life in major urban centers as efficiently as possible.

Last but not least we paid a visit to one of the world’s largest companies and a leader in the e-commerce industry, the Alibaba Group. The fact that this major corporation placed its headquarters in Hangzhou, further confirmed its role as a tech-capital. At Alibaba’s headquarters we were made familiar with the company’s quick rise to market dominance while also being introduced to its corporate culture. The Alibaba representative highlighted the importance of finding innovative ways to evolve your business, even as a market leader, in order to stay relevant and keep growing. We quickly found out how they planned on realizing this.

We were given a tour around one of Alibaba’s campuses and ended our visit in the gift shop. Here we were amazed by yet another example of groundbreaking innovation: facial recognition payment. You just took a picture of your face, uploaded it to your AliPay account and you never need to take out a card or phone again. With a quick scan of your face, the amount is immediately charged on your card. This showed again the extent of the lead China has when it comes to the digitalization of everyday processes.

This concluded a long and busy day of visits. Every one of them was aimed at creating an understanding how quickly technology advances in China but also how rapidly it is implemented. The goal was to ensure that they do not turn their gaze away from the east but learn from. This is necessary to make sure that the gap between both worlds does not become insurmountable. With such an input overload we are quite certain that this made a lingering impression.

Thursday

After a morning to discuss the previous daytrip to Hangzhou and consider whether their group project could benefit from anything they discovered the day before, it was time for another round of entrepreneur speeches and a panel discussion.

We were welcomed at the WeWork coworking space where the people from Slush had arranged a group of speakers that would share their insights and experiences when it comes to doing business in Shanghai and China in general.

Slush is a company which organizes large events with the goal to bring together start-ups and potential investors. Since it is run by young people, they target start-up companies founded by young entrepreneurs. They help them to find their way in their respective industry and also try to put them in touch with potential investors who not only make their business grow but also provide financial stability. It organizes events globally to make sure that new companies from everywhere can benefit from the service they provide.

We highly appreciate the efforts made by the Slush representatives to organize this event and book the interesting speakers that the students were able to learn from. We can honestly say it was an amazing experience.

We had the privilege of hearing from 3 Chinese entrepreneurs who have successfully navigated their way to achieve a certain level of success in the industry they work in. First we heard from Timo Lei who is the CEO of the Shanghai department of King & Wood Mallesons, a major Australian law firm. They focus on guiding companies in a new market, enabling them to build a strong foundation and become a competitor in their industry.

Secondly we had the pleasure to listen to Teng Bao, the CPO and Co-founder of Strikingly. Strikingly offers easy website templates to small businesses so they don’t have to spend their entire budget on building a strong website. Teng called it: “unleashing the power of the internet for small businesses.” Besides that, his company is also involved in the creation of mini-programs which can be linked to WeChat and contribute to the user-friendliness of the app.

Last but not least we were able to learn from Tiger Yang, who is the co-founder and president at Chinapex. Chinapex is a data technology and AI company. It focuses on analyzing large quantities of data to enable companies to advertise more personally and thereby more efficiently. They realized that blindly contacting potential customers without knowing their needs will have a negative effect on the image of the product you are trying to sell. They make sure a company’s marketing efforts has the desired effect and only targets those people who are interested in what they have to offer.

Each of these professionals gave us a short introduction on themselves, the work they do and what they see as cornerstones to run a successful business in China. After these short speeches there was a panel discussion in which they tackled the question of what it takes to become a successful entrepreneur in China.

All of them placed a lot of emphasis on seeing change as something that is inherently part of running a successful business. “No Change, No Future” is a slogan that came back repeatedly during the course of the presentation. Since China is such a competitive country, innovation needs to be implemented as it happens if one wants to stay relevant.

An interesting question arose during their talks: How can you plan to stay innovative? Their answers were similar: you don’t. You never strive to be innovative, but rather try to make life of the customer or consumer as carefree as possible. You always need to think from the point of the potential buyer. No matter what kind of groundbreaking new technology you invent, as long as the consumers don’t like it, you will never be successful. If you take on this point of view, plus take the time to research what’s happening in your industry, you will create a product or service that is and will remain relevant.

They further stressed that failing is part of the growing process and should not be seen as an end station. Failure is an inherent part of the road to success. Chinese entrepreneurs are not afraid to fail, as long as they can learn from their mistakes. In China, everything moves quickly. If something doesn’t work straight away, an entrepreneur doesn’t muddle along for months in the hope something will happen magically. They will pull the plug as quickly as possible, learn from the mistakes they made before and return with an updated plan to make sure they have a change for success the next time.

When talking about failure, the students wondered why many big companies like Google or EBay did not succeed in conquering the Chinese market. Our panel blamed this on their failure to come up with a localized product. The Chinese culture is completely different than the western one. They stressed the need to come up with a product that is adapted to the needs and desires of a Chinese audience. You cannot expect that they will just take over the product like it was in its original form. Localization is another key word that was highlighted over the course of the event.

It’s not only the product that needs to be adapted to the Chinese market. The entrepreneur himself must acknowledge that he is doing business in a completely different culture and learn how to operate in it. It’s therefore important that you find trustworthy local partners that can assist and advise you. On top of that it’s important to properly delegate your workload. Find and train local managers to get a job done the way you want it, but in a Chinese setting.

Something that was interesthng to discover was that all three of the entrepreneurs mentioned above had, at one point in their life, studied outside of China. They said it was important for them to be immersed in a culture where they were being taught with an open mindset and had room to think out of the box. To European scholars this free-speech environment is a given. This provides us with a certain advantage when it comes to critical thinking.

Judging by the unwavering attention and positive reactions by the students and their teachers we can conclude that this event was highly valuable to both. It was a unique chance to pick the brain and ask direct questions to entrepreneurs who have succeeded in China. Such valuable information is hard to find in study books or on scholarly websites. To be handed a direct line to the source is therefore an indispensable way of discovering the inside outs of Chinese entrepreneurship.

Friday

Friday was the final day of the Future and Innovation Workshop and also the day for the students to show off their work. In the morning they had to put the finishing touches on their projects. This mean not only to finish what they started but also implement any new information or techniques they had picked up on the many company visits or during the interviews.

After a quick lunch it was then time for the presentations of the several start-ups. Even though many people were in lack of some quality sleep, they still managed to pitch their ideas with vigor and enthusiasm. The professional way in which they managed visit the several companies with an open mind, while at the same time staying focused on a larger task at hand, earned them the well-deserved praise of their professors.

The ICL goal 

We at ICL are extremely proud to have been able to contribute to this cultural and business endeavor. We hope that we have helped warm up these future Swiss innovative entrepreneurs to do business on the Chinese market or collaborate with Chinese entrepreneurs. Our main goal was not only to offer assistance with logistics or the planning of valuable excursions, but also definitely to attempt to bridge the cultural gap between two nations and even two continents. If we have contributed or succeeded in this in any way, we can look back on a well accomplished job.

What is FFHS?

The FFHS or the Swiss Distance University of Applied Sciences is one of Switzerland’s premier institution for distance learning. It helps students to obtain Bachelor and Master’s degrees in a whole range of fields. From law to IT and health, FFHS offers courses in nearly every industry. It’s highly popular with Swiss students because they have to possibility to study at their own tempo, from the location they desire.

Read more about FFHS’ Master of Science in Business Administration.