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Big plans and Big money: the fuel of Chinese ecosystems Laurence Van Elegem - May 30, 2018

China Alibaba 1

Day After Tomorrow Tour China - Day 3

If there’s one word that resonated time and time again this week during Day After Tomorrow Tour China, then it’s the concept of “ecosystem”. I think that about 85% of the companies we visited referred to the concept in one way or another. It’s a fascinating thing, an ecosystem, and it requires a certain type of fuel to set it off. During the past two days, two kinds of facilitators clearly presented themselves. And, just like everything in China, they are Big.

Big Plans

This morning, we visited the China AI Town, one of the four Future Sci-Tech Cities in China. With its 700 000 square metres, it is one of the most ambitious AI projects out there. The enormous project is meant to accumulate high-end elements of AI and become a strong community of technology and innovation. It’s Big. Really Big. And one of the main reasons that this relatively new ecosystem is booming is the fact that the government has made the huge plan to become world leader in AI by 2030. You cannot achieve a goal this big without having an enormous ecosystem behind you. 

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Yesterday, we also saw the Shenzhen Open Innovation Community which believes that not so much technology as its ecosystem is its core competence. It takes the ‘old’ shanzhai (Chinese copycats) rules and transforms it into something new: where any type of entrepreneur from the streets with a good idea can leverage the SZOIL ecosystem to create and launch a prototype at an incredible speed and a very low cost. SZOIL is all about giving opportunities to people who would otherwise never be able to become ‘makers’ at such a scale. It’s an idea that goes beyond the making of a product or a service. It’s about making people’s lives better and daring to be critical about certain developments in the Shenzhen community. About thinking beyond first world problems and solving real problems for real people – like building translation apps for refugee camps or teach young monks about AI. Big problems are the most substantial drivers of innovation – take Google X’s approach of finding radical solutions for huge problems with breakthrough technology – and we tend to forget about that over here.

And let’s not forget about iCarbonX which believes that disease will become obsolete: “disease is a journey”, as Yingrui Li, their Chief Scientist put it. If you gather enough data in a holistic manner and on a permanent level, then illness just won’t ever happen again. We’ll move from diagnostics to predictions in health. That’s a pretty Big idea: obliterate disease, any type of disease. And iCarbonX realizes that the only way that they will be able to realize those plans, is if everybody in the health(care) community is on board: doctors, hospitals, insurers, sports facilitators, social media even manufacturers of everyday household products that could integrate sensors to monitor our health. Everyone that is somehow involved in health should play a role in the ecosystem, according to them.

In fact, you can’t execute Big plans without a Big community. And one of the best ways to create a big ecosystem is to get enough people to buy into your Big idea. Like many things in life, it’s a cycle.

Big Money

Yesterday, I wrote that gathering an ecosystem works really well if you offer your services for free. That’s the organic way of organizing a community, which Ingdan seems to be pretty great at. But there’s another type of ‘glue’ to seal nodes together into an ecosystem. One that’s a lot more prosaic: money. And, with the BAT giants and the enormous rising wave of unicorns, there is a lot of that around in China. In fact, the BAT function as magnets for ecosystems. In two ways: obviously the little fish want to be in the vicinity of the big fish because the VCs are there, the suppliers, the talent,… Ecosystems beget ecosystems. It’s a basic law of attraction.

But the BAT are also continuously investing in new and upcoming startups and scaleups in order to bet on as many imponderables as possible. Micro-innovation is a term that we heard at Tencent and which I really loved: if you keep adding and testing innovation upon innovation, however small, then you are continuously reinventing yourself. Just like that, if you are a Big giant – however innovative – building a community of very fast and ruthless little nodes around you, will always keep you awake and aware. That’s one of the most remarkable about China: I’m not so much triggered by the scale of things (which is very impressive, granted) as by the fact that the architecture of the big companies, big ecosystems, products, services, always seems to consist of a collection of small, highly autonomous and ultrafast nodes. “The next big thing will be a lot of little things”: it’s something that China has fully integrated and understood.

So it’s no surprise that every company that we visited somehow seemed linked to Tencent, Alibaba or Baidu. Ant Financial, for instance, belongs to Alibaba. Tencent, which is often called an “investment company” has invested in iCarbonX. Baidu has invested in the "Tesla of China", Nio. Ecosystems follow money and money creates ecosystems. The latter is actually an important part of the way that the Chinese innovate, which is tree-fold: trading market access by only closing deals if there is a transfer of intelligence to local talent, building it themselves (like Huawei developing a 5G chip) or – like is the case in this instance – acquiring technology. 

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Laurence Van Elegem
Laurence Van Elegem

Laurence has more than 10 years of experience in marketing, communications and disruptive innovation. Passionately curious, she is fascinated by the impact of technology and...

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