Chinese tech startups aren't just imitating anymore -- and investors are starting to pay attention

The first wave of China-based internet startups adapted Western business models, sprinkled them with some extra touches, and leveraged the world’s largest base of online consumers to build huge businesses. Baidu, Tencent and Alibaba have become huge companies, dominating China’s market for internet search, social networking and e-commerce.

The most recent wave of fast-growing Chinese tech companies has taken an entirely different path. Rather than copy Western business models, Chinese entrepreneurs are experimenting with new business models, creating companies that have no analogue in the West.

Room for experimentation

Chinese authorities are showing surprising tolerance for business model innovation, often allowing young companies to grow unencumbered by regulatory pushback for much longer periods of time than in other countries.

Consider, for instance, China’s booming bike sharing industry: over the course of just a few years, Chinese bike sharing companies like Mobike and ofo have deployed millions of bikes in cities across China, creating a new industry worth billions in a flash.

Bike sharing is not a new idea. New York’s Citi Bike system was installed in 2013 – and there are similar programs in many U.S. and European cities. In China, however, the idea has taken a new direction: Chinese bike sharers use apps on GPS-capable phones to find the nearest GPS-enabled bikes wherever they might be parked around the city, not just at designated kiosks. They then pedal to their destinations and log out, leaving the bikes more or less anywhere and making them available again to other riders. Read more

Fan Bao - Business Insider Australia - 26 July 2017