VC monsoon a boon for expats
Updated: 2015-03-30 09:12
By Matt Hodges(China Daily)
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Sherpa's founder Mark Secchia and some of his couriers.[Provided to China Daily] |
The $5 app offers 1,500 recipes and partnerships with Michelin-star chefs and celebrity food bloggers. It was named one of the best apps of 2014 by USA Today and has offices in Shanghai and Santa Monica.
"We raised money from angels and institutional investors. Chinese investors are definitely getting more into early-stage investors, especially in high-tech, innovative fields," he said. "They're interested in companies that are trying to invent."
Diana Tsai runs League X, an agency for high-growth China tech startups specializing in storytelling, design and power partnerships. The company partners with local venture capitalists and works with their portfolio companies. It is also doing China's first startup ecosystem report in partnership with Silicon Valley-based Compass.
"What we've learned is there's far more money here than good startups. There's a lot of money here that is looking to follow instead of lead. There's a lot of talk of 'visionary entrepreneurs'," said Tsai, whose mom hails from Shanghai.
First in, best dressed
When it comes to Sherpa's, Secchia's success owes as much to his business savvy as to his early-player advantage.
He is fluent in Mandarin, was one of the first foreigners to earn an MBA from Shanghai's prestigious China-Europe International Business School-and he knows how to work with the Chinese.
Secchia doesn't actually have a joint venture or wholly owned foreign enterprise to do the business. He uses it as a consulting platform through which he consults to local companies like Sherpa's.
"I do this weird mix. I'm neither Chinese nor foreign. I'm both," he said. "Take Sherpa's for example. We look like a foreign company at hiring fairs, but in reality everything is like a Chinese company."
To set up his latest venture, he registered a WOFE, of which he is the owner and only employee. The company has a contract with Sherpa's to act as its sole supplier, but Sherpa's is owned by Secchia's silent business partner, Shanghai's Benny Ji. The two were classmates at CEIBS.
Michael Michelini, author of Hong Kong Supercharged, is finishing his second book on setting up a company in China.
"If you want to import luxury goods or food to supply Chinese people, and find distributors, Shanghai is where it's at," he said.
Element Fresh, a health-accented restaurant chain started by Americans Scott Minoie and Sheldon Habiger in 2001, now has 26 restaurants spread across several Chinese cities. Wagas and Yasmine's Steakhouse and Butcher Shop also number among the foreign-founded success stories in the local food and beverage industry.
The local business climate also favors fashion, cosmetics, advertising agencies "and to a lesser extent, finance, but this is growing", according to T.R. Harrington, the American founder of digital marketing consultancy Darwin Marketing.
Yu Ran in Shanghai contributed to this story.
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