It's Beijing, not Shenzhen
If you start looking at theWestern world, there's a common thing appearing. There is not enough talent - everybody just gets stuck. So, hop over to the East, we have a few hotspots. The easiest hotspot to see is in Beijing. A lot of people thought it is Shenzhen, but it's not. This is largely because we have maturity investment in Beijing, and that's where it starts to gather. It is very vibrant. What they have done there is taking all the talents from the university, and they are hungry for a job; and this allowed them to do anything. The government has come up with a reasonably good scheme, allowing students or fresh graduates to start any business. It is not a huge sum of money - it is sufficient enough to help them start something small, but insufficient for them to go very far. Only an approximate $50,000 of loan was given.
With this, it allows the ecosystem to develop. But the major weakness for such ecosystem is that, for China, the majority of them don't speak English. This group of people, I won't call it inbreeding, but they are only looking at problem solutions within China; although the market is really huge but they are only able to copy each other. Those who know foreign language tend to have a certain advantage. They see what is outside and they try to copy. But majority of these people are the second or third start up. That means they are a reasonably successful entrepreneurs. Eventually, all these people come up.
This is one of the three major hotspots.
Hong Kong and Taiwan
Of course, you can take a look at Hong Kong, which has been having a lot of entrepreneurs all the time, but they are doing a non-tech kind of business. On the other hand, Taiwan was successful a long time ago. It did something very right during the last two downturns. What they did was, during their downturn, they went out to scout for technology such as Acer and TSMC 9 Taiwan Semiconductor Manufacturing Company). They bought all the technology they could find, and eventually it became the world's largest manufacturer in terms of motherboard, etc. That is when they built the foundation.
Taiwan's semiconductor TSMC is now one of the largest chipmakers. It's all because during that time, they went out to scoop the technology, when it was cheap. They have done that correctly last time but because of the current administration, I think they are not focusing on this anymore. It depends on China, and China becomes a major manufacturing base for them. They began to lose some of their edge.
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