Lin Min

    linmin67@126.com

    WITH thriving entrepreneurship, Shenzhen, which celebrates its 35th anniversary Wednesday as China’s first special economic zone, is known domestically as the country’s city of startups. Now, the city is becoming more and more appealing to overseas entrepreneurs who want to find an ideal place to start up their business.

    A Shenzhen Daily story Friday gave a glimpse into a French-invested company that helps entrepreneurs from around the globe develop and begin making products in Shenzhen. Many of these products are the foundation of new businesses. The company, a hardware accelerator called HAX, was founded by French venture capitalist Cyril Ebersweiler about three years ago. At the end of the current “class,” HAX will have graduated 80 companies, many of which were founded by foreign entrepreneurs. Many startup hardware companies in the world are seeking out HAX, according to Entrepreneur.com.

    Huang Dinglong, CEO of Shenzhen-based artificial intelligence company Malong Tech, revealed to the Nanfang Daily in May that his American partner, Matt Scott, told him that Shenzhen is more “vigorous” than Silicon Valley. Huang told the paper that an increasing number of technology innovators and young entrepreneurs from around the world are moving to Shenzhen to try to turn their ambitions into reality.

    Entrepreneur.com last month listed Shenzhen as one of the “Six Global Alternative Cities to Silicon Valley to Start Your Company.” While Silicon Valley remains the “center of the universe of startups,” launching a startup there is expensive and competitive, the U.S. website said.

    One of Shenzhen’s allures for young entrepreneurs is that it is not only a manufacturing outsourcing center but also a thriving hub for hardware companies. “There’s no other place in the world that has access to the resources Shenzhen does in terms of actual manufacturing and actual development,” Mat Mets, the founder and director of Guangzhou-based Blinkinlabs, told Shenzhen Daily. Mets was part of the second class to go through HAX in 2013.

    Mat’s comment was echoed by Entrepreneur.com. In the massive SEG Electronics Market, you can buy various kinds of components, including many sensors and chips that aren’t available yet in the U.S., the website said. Other component and material trading hubs, like China South City, provide everything you need to turn your ideas into products.

    Technical expertise also abounds in Shenzhen, which has more than 30,000 technology companies, including 4,742 officially accredited as China’s high-tech companies. In 2014, companies and individuals in Shenzhen filed 11,600 international patent applications under the Patent Cooperation Treaty (PCT), about half of the country’s total and more than the number registered in France, which ranked sixth globally.

    With seaports handling the world’s third-largest number of shipping containers, its close vicinity to Hong Kong and the extensive networks of the Pearl River Delta, goods can be shipped from Shenzhen with unparalleled efficiency.

    Venture capital also abounds in Shenzhen, which has over the years seen more than 8,000 venture capital institutions established here with 400 billion yuan (US$62.6 billion). These venture capital institutions have invested in more than 3,500 small and medium enterprises, including more than 400 that are now listed in domestic and overseas stock markets. Many startups won’t be able to survive without investors willing to take the risk and lend a helping hand.

    Even as China’s economy has slowed down, Shenzhen has fared better than most other Chinese cities because of the soaring numbers of new startups and robust emerging industries. In 2014, 444,000 new business entities were registered in Shenzhen, a 20 percent growth from 2013.

    China International Capital Corp. Ltd. (CICC), the country’s first Chinese-foreign investment bank, said in a report in May that Shenzhen has become China’s Silicon Valley and the city’s economy could surpass Hong Kong’s next year.

    But Shenzhen still faces some hurdles if it wants to attract more overseas startups. Soaring property prices have made a dent in Shenzhen’s competitiveness. The city government plans to open more than 200 international maker spaces in the next three years where affordable accommodation is provided for makers and entrepreneurs. However, subsidized housing should be extended to benefit more startup entrepreneurs.

    The difficulty in obtaining a visa also needs to be addressed. Some teams haven’t been able to attend HAX because of visa issues.

    In the 35 years since Shenzhen became China’s first special economic zone, the city has seen a large number of local startups become globally known giants, such as Tencent, Huawei, Vanke and Ping An. Now with a proven culture of innovation, full-fledged supply chains, efficient infrastructure, top-notch talent and plenty of venture capital funding, Shenzhen is on the way to becoming an international startup center. But it needs to consider what foreign entrepreneurs need in terms of policy changes to make the city truly international. For policymakers who used to focus on domestic issues, making foreign entrepreneurs feel at home is a huge challenge.

    (The author is head of the Shenzhen Daily News Desk.)