Business in China is focused around Shenzhen, Shanghai, and Beijing. . In all three, expect to find plenty of talent and ambition.
Frank Meehan is Founder and CEO of SmartUp, a mobile-first “micro-learning platform for the smartphone generation” which counts the employees of some of the world’s largest brands among its learners.
Born and raised in Australia, Frank is a global citizen having garnered commercial experience on four continents before the age of 30. “I did a degree in mechanical engineering in Sweden after a short stint at the Royal Institute of Technology in Sydney”, he says. “My first job was as a coder and troubleshooter for Ericsson in Sweden, from where I was sent around the world to hack into switches and fix things on the side. By the time I was 25, I was building phone surveillance systems for governments in Asia and South America, which was an interesting start to my work life.”
His career accelerated with the birth of 3G. Today, we have a good idea of what new iterations in bandwidth and capacity will achieve, but 3G’s unveiling was a free-for-all between companies, governments and regulators – often all with embryonic knowledge.
Frank had a knack for telling a story and found himself in Singapore, lobbying for European 3G networks trying to crack the Asian market ahead of their US competitors. “We formed a massive marketing conference to visualise what 3G could do and coupled it with a roadshow which was very successful. By the time I was 28, I was in charge of sales for 3G in the UK with a team of 200 people and my first job was to cut the workforce in half. I was also in charge of bidding for licenses in the 3G spectrum auctions. Hutchison won the contract and recruited me to run their engineering function in order to make 3G work with Lucent, Nortel, Ericsson, and Nokia devices. From there, I worked with a large team of engineers and UX designers while being responsible for all their handsets built around the world, bouncing back and forth between Hong Kong and the UK.”
His globetrotting continued at Horizon Ventures in Hong Kong (“where I got to see a lot of good and bad things about working with family offices and tech around the world”) and SparkLabs Global Ventures, now the dominant startup player in Hong Kong, Korea, China, and Taiwan, before leaving to launch SmartUp.
As an entrepreneur with a global footprint, Frank has a particularly balanced perspective and says that despite the heterogeneous nature of the Asian region, there is plenty to support the spark of a high-growth business. “I have often found it easier to do business in Asia and in the US than in Europe, because things just move faster”, he says. “The workforce is less hierarchical and people are prepared to make decisions. There’s a pressure to move fast, so people get things done.
That’s not to say each territory is the same, or even worth the effort. Meehan finds India particularly challenging. “In India, everything is about price – it’s always a race to the bottom”, he says. “It reminds me of the saying ‘to know the price of everything, but the value of nothing’ – which makes differentiation particularly hard in technology. While I was at Ericsson, we spent a lot of time working on a value add pitch and got nowhere. Eventually we gave in and focused on selling handsets at the lowest price point – even if they weren’t new – and sold them by the lorry load.”
Meanwhile, he has some quick tips on other countries in the region:
SOUTH EAST ASIA
“It’s a massive region, but 80% of large South East Asian companies are headquartered in Singapore. The countries are relatively similar but it can be challenging to get your money out. Corruption levels can also be high, so to do business, it is really about who you know.”
“In general, the Chinese really understand the concept and impact of a product’s value rather than focusing on just the price, so understanding value in the market is crucial to making money. However, it requires excellent in-market knowledge – and be sure to work with high quality business partners. Business in China is focused around Shenzhen, Shanghai, and Beijing. In all three, expect to find plenty of talent and ambition: China is no longer focused exclusively on hardware; software is now booming, too. For technology, you probably want to focus on Shenzhen more than Beijing because you can move to Hong Kong more easily. If you aren’t ready to tackle China, just as with the SEA region, establish a base in Singapore first: it’s rich in talent.”
“Having mentioned Hong Kong, whilst it’s a strong and unique market with the ex-UK connection, it’s not the place for a home base in China. Hong Kong has very little start-up mentality because their focus is entirely in the traditional property and banking sectors.”
”Korea is tremendously interesting and vibrant. There are plenty of young founders who have been well educated in the US and moved back home with all that knowledge and an incredible work ethic. They work extremely hard and want to conquer the world. They also understand China very well.”
“Japan has always been a technology powerhouse, but that doesn’t make it an easy sell. The country’s business structure is very inward focused and still dominated by major family-run concerns, plus it is culturally unique; so it is extremely hard for outsiders to gain a foothold.”
AUSTRALIA AND NEW ZEALAND
“Finally, these huge countries. They will give you a false sense of promise, because whilst they’re culturally familiar, the markets are small. And they will involve feats of travel to manage.”