Newborntown founder Harry Liu: What should startups do when faced with tech giants

Harry Liu, founder and CEO of Newborntown, spoke about weapons that small and medium startups can use to compete with tech giants, at the GMIC in Beijing on Thursday.

Newborntown is a Beijing-based startup focusing on mobile app development and overseas digital marketing. It developed a wide array of smartphone apps called Solo System assembly – including launcher, weather, and photo editing apps – that have attracted more than 600 million users in nearly 200 countries. Meanwhile, it distributes advertising spaces to these users. Founded in 2009, it is a developer to several apps recognized by Google as “the world’s best application”.

History repeats itself

“I love to read history,” said this 32-year-old Liu. “The race in mobile internet era does not differ fundamentally from that in (personal computer) internet age. It is difficult for small companies to compete against tech giants.”

Harry Liu spoke at GMIC Beijing 2017. Photo from GMIC
Harry Liu spoke at GMIC Beijing 2017. Photo from GMIC

Although some unicorns – including Didi Chuxing and Metuan Dianping – appeared on the scene in the mobile internet age in China, Liu pointed out, so far there are no new companies that can disrupt the status of BAT, namely Baidu, Tencent, and Alibaba. Few top tech companies share as many as 70% of all the profit, according to him.

A small boat for overseas market

Liu compared the race with big companies to a battlefield where the rivals are equipped with powerful weapons like tanks. In such a situation, it might help to avoid the battle and sail away overseas in a small boat.

“Newborntown started overseas business four years ago, because we believed this was a big opportunity over the next 10 years since then,” Liu told AllChinaTech.

However, another solution could be improving efficiency, with the benefits of Artificial Intelligence (AI).

“So far, we have created more than 6,000 user tags for better targeting,” said Liu.

0.01% completed

Liu believes Chinese companies have just completed 0.01% in the overseas expansion journey. He said less than five Chinese companies have really established businesses in Middle East, and each company has a limited staff in that region. There is still huge opportunity.

Chinese companies are in a leading position around the world in this mobile internet era. China is among few regions where domestic companies can compete with American companies. For example, Didi Chuxing successfully held its territory after Uber lost about USD 2 billion over two years in the market amid high-profile subsidy wars.

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