A friend of mine told me that Japanese companies look for the following in vendors: 1. have they IPO'd? if not then, are they 2. funded by a big VC? and, failing that, have they at least 3. won some award?
It all comes back to a lack of desire to reward innovation despite its obvious risks and wanting to play it safe by requiring external validation.
This can be good, in a way, because it forces entrepreneurs who still decide to operate in this environment figure out the needs of what we in the US would call the "late-majority" on the technology adoption curve (which is also usually about half of the largest part of any given addressable market).
I'm guessing (though only guessing) that some of these things are also true in China. Perhaps it's very different in B2C.
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> a $115 million fund in order to create five successful Chinese startups a year
The funding levels imply it is less like YC and more like a standard VC. With those numbers -- even assuming 50% overhead, and five years of five startups each -- that's over $2 million per startup. YC starts at $17k to $20k per startup.
I imagine that the high level of funding is to impress the hell out of potential partners and new recruits. For a variety of reasons, many people in China will shy away from a new and risky business. In order to get employees and partners on board, you need to give the impression that you are large, in charge, and not going anywhere.
And of those that could most were needed a lot of hand holding to do any basic tasks (and some of those were people with 3 years experience, I can't imagine how they could have provided any value to the company they were working for)
Kai-Fu Lee's Innovation Works is www.innovation-works.com not www.innovationworks.org
