China Roundup: Y Combinator China dream
Hello and welcome back to TechCrunch China’s Roundup, a digest of recent events, the design of the Chinese tech landscape and what they mean for the people in the rest of the world. Last week we looked at how Alibaba and Tencent went it in the last quarter, and the talk in Silicon Valley and Beijing this week on Y Combinator, the sudden withdrawal from China. We also discuss the permanent food-delivery-service-war in the country, and later.
Short adventure in the East
The fabled Silicon Valley accelerator Y Combinator announced the closure of its China unit is only a little over a year after it was in the country. In a vague statement released on its official blog, the Organisation said the decision came amid a change in leadership. To initiate Sam Altman, a former President who engaged the legendary artificial intelligence scientist, Lu Qi, of the China operation, recently left his high-profile role to join a research outfit OpenAI. With that, YC has been the reorientation of its energy. “local and international startups from our headquarters in Silicon Valley.”
What was untold, the insurmountable challenge is to attract multi-national companies in their attempt, in a completely different market. Lu-Qi, the was management hats wore at Baidu , and Microsoft, before he YC, clearly aware of the obstacles, when he said in an interview (in Chinese) in may that “multinationals in China have been almost wiped out. You almost never successfully land in China.” The prescription, he believes, is the establishment of local Teams, the full autonomy to make decisions around products, operations and business.
argues A former Executive at an American company, the China branch, who asked to remain anonymous, that the Lu-Qi ‘s one-man effort, enough to beat the curse of multi-national companies’ path in China. “All I can say is: Lu has taken a detour. Going independent is the best decision. If it’s a question of whether the Chinese Start-UPS are also suitable for the care of, or whether incubators bring value to China, which are separate issues.”
What is curious to have a meaningful degree of freedom before the split is that YC China has been given seemed to have. “Thanks to Sam Altman, and the US team, who agreed with my views, and supported with a lot of preparation, YC China, the most important resources of YC US is not to enjoy not only able, but also work in a completely independent capacity,” Lu said in the may interview.
you will have to Move, the old YC-China-team-join-Lu-to Finance Qi, a new company within the framework of a newly created program, miracle plus, announced YC China, a wechat post (in Chinese). The initiative has its own Fund, team, Organisation and operational team. The deep-gang, Lu has promoted with YC will continue to receive the benefit of his new portfolio “support” of the YC headquarters, although neither the party worked out what that means.
Alibaba ‘ s food delivery nemesis
The food delivery war in China is still dragging on two years after the great consolidation, leaving the market two important players. Meituan, the local services that supports companies managed by Tencent, it is to achieve a growing share against Alibaba-owned Ele.me. According to the data of the third (in Chinese), available from trust data, Meituan accounted for 65.1% of China’s entire food-delivery service orders during the second quarter, steadily, from just under 60% a year ago. Ele.me, on the other hand, has lost
In terms of monetization, Meituan generated 15.6 billion yuan (2.2 billion U.S. dollars) in revenue from its food delivery segment in the quarter ended September 30. Dwarves, Ele.to me, what broke 6.8 billion yuan ($970 million Euro) in the same period. Both are growing North of 30% per year-for over a year.
This may not everything that surprising in light of Alibaba probably have to fight more battles ahead. The e-commerce was started consumed the market by the increase in the Pinduoduo, the has, an attack on China ‘ s low-tier cities with their ultra-cheap products and social-driven online shopping experience. Meituan, on the other hand, is fixated on beefing up your most important turf-on-demand neighbourhood services after the sale of his expensive bike-sharing effort.
to burn If both participants are over the capital, as you have shown, through the subsidisation of the customers and the restaurants — the race comes around that has more control of the data traffic. Meituan holds a competitive advantage thanks to the merger with Dianping, a leading restaurant-review-app similar to Yelp, back in the year 2015. Dianping today operates as an independent brand, but its food app is deeply integrated with Meituan, the delivery of services. For example, hundreds of millions of users in the location, Meituan-powered food-delivery service orders directly from Dianping.
Alibaba and Meituan are used to on more friends, only a few years ago. In 2011, the e-commerce giant, the $ 50 million series B funding round took place in Meituan. Before long, the two clashed over control of the company. Alibaba is known to impose a heavy hand to its portfolio companies by taking majority holdings and regrouping of the company with new managers. That’s because Alibaba believes that “only when they work, they can generate synergies and really exponential value,” said vice chairman Joe Tsai said in an interview. “whereas, if you only a financial investment, they are counting an internal rate of return. You’re not creating real value.”
Ele.to me the transformation of lives. In September, Alibaba has reportedly (in Chinese) completed replacing the Ele.to me, the management with a pool of officer personnel. Ele.me founder Xuhao Zhang left the firm with billions of yuan in cash and a venture capital company (in Chinese) entered into force.
Meituan founder Wang Xing had more unrestricted activities. In a later round of financing, he refused to accept, Alibaba is a prerequisite for the portfolio to avoid company Tencent investment, a strategy to hobble the giant its arch-rival. The screw-up of the partnership, and Alibaba has been generating since then, a gradual shift of its Meituan share but still in small quantities, according to Wang in the year 2017, “restlessness” for Meituan for the future.
Released on Sat, 23 Nov 2019 16:00:50 +0000