Mao Daqing, founder and chairman of the co-working space provider UR Work, spoke on Saturday at the 2016 NetEase Annual Economist Conference about problems and opportunities concerning innovation in China.
Mao was the senior VP of real estate developer Vanke before he resigned from the post and founded UR Work in 2015. The startup incubator is now present in eight cities including Beijing, Shanghai and Shenzhen, and is valued at nearly RMB four billion (USD 603.14 million).
The days of a simple “Euraka!” are gone
Although China has welcomed this new era of startups – when almost anyone can start a business with potential for global impact – a business model without innovation is unlikely to succeed.
Mao Daqing believes that the biggest obstacle for innovation now in China is the rising threshold of requirements for technology.
A representative example would be innovation in business models. At first glance, companies like Uber seem to be profiting from their innovative business model and nothing else. However, in reality, the business model is backed up by advanced technology like cloud computing, big data, and deep learning. This means that aside from an interesting business model, a company should keep on combining various technologies to grow a better business model.
Although China has a large population as potential user base for new business models, innovation without the support of high technology is hard to succeed.
“Enterprises with top-notch technologies shall rule,” said Mao.
Walking the walk
Innovation in China is often stymied by the difficulty of converting breakthroughs in scientific and technological research into products or services.
Mao said that a nation’s true scientific and technological strength is only reflected by its efficiency in turning the results of academic papers into things that can be applied to industries, and actually generate profits. He believes that only when scientists, enterprise managers and capital work together, does society achieve the best result.
In addition, small and medium sized companies (SMEs) are becoming better at integrating technologies with industry, judging from the 540 plus startup teams at UR Work.
Opportunities may lie in…
Mao believes that, in the short term, machines or robots with artificial intelligence may not completely replace humans as a work force; instead, the next opportunity for innovation may lie in human-machine integration, or a “super organism” in Mao’s words.
Last but not least, Mao suggested investors ask three questions before they invest into enterprises in the field of cutting edging technologies:
1. Could their technology lead the market?
2. Is their core technology hard to copied?
3. Is the market mature for them, and is the timing right?
(Top photo from Baidu Images)