Finding Chinese Strategic Partner


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This document provide a general suggestion for finding Chinese strategic partner for a western technology company

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Finding Chinese Strategic Partner

  1. 1. Finding Strategic Partners  in China Sean Yan Green Bridge Consulting
  2. 2. Who Needs a Strategic Chinese Partner? <ul><li>Do you have advanced technology products / services that Chinese economy could use to her own benefit? </li></ul><ul><li>Are you confused as how to reach the right end customers in China effectively to best recognize the value of your products / services? </li></ul><ul><li>Are you overwhelmed by complicated internal structures in China and by complicated screening criteria which do not always make sense from your perspective? </li></ul><ul><li>If the answers to the above are yes, then you should consider finding your strategic Chinese partner, and we will explain who you may consider and how to reach them. </li></ul>
  3. 3. Strategic Chinese Partners <ul><ul><li>Your needs on the strategic partners are to use them as the resources or channel to reach specific customers / clients. They can be classificed into three kinds: </li></ul></ul><ul><ul><ul><li>Government: Favorable policy (industrial & tax) on the particular technologies / sectors and on the standard.  </li></ul></ul></ul><ul><ul><ul><li>Industrial : Sector authority / resources to speed up the implementation through their existing channels.  </li></ul></ul></ul><ul><ul><ul><li>Expert: Technical voice to influence resources weight to particular technologies / sectors.  </li></ul></ul></ul><ul><ul><li>The equity structure reflects roles, risks and resources put into the JV for each partner. </li></ul></ul>
  4. 4. Governmental Partner <ul><ul><li>Governmental role is to sustain the economic growth </li></ul></ul><ul><ul><ul><li>will favor shining projects for political credits  </li></ul></ul></ul><ul><ul><ul><li>will give policy/tax incentives for future tax revenue </li></ul></ul></ul><ul><ul><li>Shining projects include technologies that  </li></ul></ul><ul><ul><ul><li>can improve China's independence on strategic industrial such as energy   </li></ul></ul></ul><ul><ul><ul><li>can help China to gain core technologies such as semiconductor </li></ul></ul></ul><ul><ul><li>Favorable incentive policies includes  </li></ul></ul><ul><ul><ul><li>land price well below fair market value  </li></ul></ul></ul><ul><ul><ul><li>free office space and free apartment for the first 2-3 yrs  </li></ul></ul></ul><ul><ul><ul><li>fund to relocate key technical experts  </li></ul></ul></ul><ul><ul><li>At what level? </li></ul></ul><ul><ul><ul><li>the execution levels making impacts to your biz </li></ul></ul></ul><ul><ul><li>Government is the lubricant, should not be the core of JV </li></ul></ul>
  5. 5. Industrial Partner <ul><ul><li>Your industrial partner is the key partner who should have the same drive to succeed as you and should drive the daily operation in China </li></ul></ul><ul><ul><li>The ideal industrial partner is a private partner  </li></ul></ul><ul><ul><ul><li>who provides industrial resources & marketing channels </li></ul></ul></ul><ul><ul><ul><li>who shares the risks and the rewards </li></ul></ul></ul><ul><ul><ul><li>who does not have the potential conflict of interests  </li></ul></ul></ul><ul><ul><li>State-owned companies are typically not a good JV partner candidate because they operate similar to the government </li></ul></ul><ul><ul><li>Your industrial partner is the core of the JV </li></ul></ul><ul><ul><ul><li>business model </li></ul></ul></ul><ul><ul><ul><li>share structure </li></ul></ul></ul>
  6. 6. Expert Partner <ul><ul><li>To be a dominate player in any industrial sectors in China, you need to have some voices to influence the policy </li></ul></ul><ul><ul><li>Policy maker listens to the experts particularly those who does not have the potential conflict of interests to JV </li></ul></ul><ul><ul><li>Well-known professional associations or industrial chambers are good sources to reach pools of experts  </li></ul></ul><ul><ul><li>Favorable opinions from experts may lead to additional channels to reach clients / customers </li></ul></ul><ul><ul><li>Experts are the marketing partners for the JV </li></ul></ul>
  7. 7. Do and Don't in Finding a Partner <ul><li>Do: </li></ul><ul><ul><li>Use trusted intermediate to identify key players </li></ul></ul><ul><ul><li>Get to know key players, engaging the needs of individuals & organization </li></ul></ul><ul><ul><li>Establish the case & show long term interests  </li></ul></ul><ul><ul><li>Be flexible to adjust the biz model to fit China's need </li></ul></ul><ul><li>Don't: </li></ul><ul><ul><li>Don't just trust the title & only work with the top guy in the industrial </li></ul></ul><ul><ul><li>Don't jump to reach the agreement & believe they will deliver the promised </li></ul></ul><ul><ul><li>Don't talk about money in before established trusts </li></ul></ul><ul><ul><li>Don't stick with proven biz model in the west </li></ul></ul>
  8. 8. Green Bridge Approach <ul><ul><li>Help organize delegations visiting science & technology parks in major areas (Beijing, Shanghai, Chongqing, Shenzhen, Chongqing, etc ) </li></ul></ul><ul><ul><ul><li>meet decision makers in science parks / governments </li></ul></ul></ul><ul><ul><ul><li>meet relevant experts in industrial organizations </li></ul></ul></ul><ul><ul><ul><li>meet key scholars in Chinese Academy of Science </li></ul></ul></ul><ul><ul><ul><li>show off in trade show / conference  </li></ul></ul></ul><ul><ul><li>Identify and screen private investor / industrial partners  </li></ul></ul><ul><ul><ul><li>via local officials, academic & industrial experts  </li></ul></ul></ul><ul><ul><ul><li>via industrial associations / chambers of commerce </li></ul></ul></ul><ul><ul><ul><li>via venture capitalists in China </li></ul></ul></ul><ul><ul><li>Negotiate on your side </li></ul></ul><ul><ul><ul><li>design win-win agreement and milestones  </li></ul></ul></ul><ul><ul><ul><li>support on gathering local experts on due diligence  </li></ul></ul></ul>
  9. 9. Green Bridge Partners in China <ul><li>Industrial organizations: </li></ul><ul><ul><li>China New Energy Chamber of Commerce   </li></ul></ul><ul><ul><li>Shanghai Transportation Electronics Associations </li></ul></ul><ul><ul><li>Semi China </li></ul></ul><ul><li>Science Parks / Local Governments:  </li></ul><ul><ul><li>Suzhou Industrial Park </li></ul></ul><ul><ul><li>Ningbo Hangzhou Bay New Zone </li></ul></ul><ul><ul><li>Beijing Municipal Commission of Economy & Info Tech </li></ul></ul><ul><li>Chinese Academy of Science </li></ul><ul><ul><li>Suzhou Institute of Nano-tech & Nano-bionics   </li></ul></ul><ul><ul><li>Tianjin Institute of Industrial Biotechnology </li></ul></ul><ul><ul><li>Shenzhen Institute of Advanced Integration Tech </li></ul></ul><ul><li>Venture Capital: </li></ul><ul><ul><li>China:  Infotech Pacific Ventures ,  NewMargin Ventures </li></ul></ul><ul><ul><li>Silicon Valley:  Walden International , Sierra Venture </li></ul></ul>
  10. 10. About Green Bridge Consulting <ul><li>Green Bridge Consulting is a consulting practice of Makesens Inc that Dr. Sean X. Yan founded in Silicon Valley. Sean is devoted to build the “ Green Bridge ” to facilitate the integration of Silicon Valley technologies with growing China’s “green” economy, as a Silicon Valley representative of Suzhou Institute of Nano-tech & Nano-bionics (SINANO) , Chinese Academy of Science (CAS, like US national labs). Sean also serves on the Board of Directors for the Chinese American Semiconductor Professional Association ( CASPA ), leads a &quot;New Energy Special Interest Group” facilitating project match with US China Green Energy Councel , China New Energy Chamber of Commerce and Suzhou Industrial Parks , and is a member of IEEE-CNSV. </li></ul><ul><ul><li>Green Bridge China is headed by Dr. Wei Yu, who is also a p rofessor and the group leader of magnetic sensor application team at SINANO, CAS. Wei has extensive system engineering experience from prototype, engineering design, to the standard test procedure in China, and is familiar with the whole product life cycle from concept to volume production. </li></ul></ul><ul><ul><li>Green Bridge developed extensive “guanxi” ( 关系 ) with successful business people constantly winning tenders at various local infrastructure projects related to utility, specialty vehicle manufacturers, airport, and water rehabilitation, etc. </li></ul></ul><ul><ul><li> To contact Green Bridge Consulting, email [email_address] and [email_address] or call 408-657-3673, and15995704901. </li></ul></ul>