The document provides an overview of China's largest tech companies, known as BATX (Baidu, Alibaba, Tencent, Xiaomi). It summarizes their business structures, including revenue sources, market capitalization, and key business units. It then analyzes how the BATX emerged due to the "Great Firewall of China" blocking major Western tech companies like Google and Facebook, and how the BATX have grown to inspire the West with their innovation approaches like business Darwinism and leveraging big data.
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Speaker Profile : Martin Pasquier
Who?
Entrepreneur
Facilitator
Consultant
Author
Lecturer
What?
Disruption
Innovation Strategy
Business models
APAC Markets
Vision:
Empowering my clients as a "digital sherpa", to understand
and take position in the broader digital and innovation
revolution which disrupts all industries today.
martin@innovationiseverywhere.com
+65 9235 4234
www.innovationiseverywhere.com
Martin Pasquier
Facilitator, Speaker, Moderator,
Panellist in Tech Conferences
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At the crossroads of innovation,
change management & design
• Empowering our clients to take action over the key
disruption they face in the XXIst century
• Strong belief that Asia is the epicenter of key disruptions:
demographic, technologic, cultural, economic
• Can-do attitude and connector to relevant stakeholders of
innovation across APAC: accelerators, experts, investors,
peers, MNCs, etc
4. 4
Exciting Topics We Work On
• Research on key trends in Asia
• Covering key tech events
Disruptive Asia
• From Learning to Doing
• Startups, M&A, Prototypes, Labs
Digital Transformation
• Top founders, VCs,
Fortune500 executives
across APAC
Network of Connectors
5. KEY QUESTIONS ANSWERED
1. Why did the GAFA fail in China and how
have the BATX grown so fast?
2. Are the BATX really like the West’s GAFA?
3. What aspects are the BATX inspiring the
West today?
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How did the BATX emerge?
The Great Firewall of China
Concept
Regulations began in 1997, after
the Internet arrived in 1994.
Great Firewall of China
“Fly-swatting” ideology that led to the
technological development of the
firewall
GAFA Ban
Google is banned in 2010 for failing
to censor its material and adhere to
regulations
Xi’s Consolidation
of Power
Ban of Winnie the Pooh,
Facebook still locked out, ...
Fully Parallel Universe?
Ongoing ban on VPNs, AI surveillance,
CCP seats in the BATX, ...
1997 2008 2010 2017 2018~
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How did the BATX emerge?
Why the GAFA have been locked out
Google Amazon Facebook Apple
Revenue
(USD)
90.27B 136B 27.6B 215.6B
Key
products
Advertising (85%)
Other Google
Revenues (14%)
Other Bets (1%)
Product Sales (69.6%)
Service Sales (30.4%)
Advertising (97%)
Payments & Other products (3%)
iPhone (63.4%)
iPad (9.5%)
Mac (10.7%)
Apple Pay & Other
Services (11.3%)
Apple TV & Other
Products (5.1%)
Baidu Alibaba Tencent Xiaomi
Revenue
(USD)
10.1B 74B 21.9B 13.5B
Key
products
Online Marketing
(91.4%)
Baidu Cloud & Other
Services (8.6%)
Financial Services (78.2%)
Core Commerce (19%)
Digital Media (1.23%)
Cloud Computing (0.55%)
Other Bets (0.25%)
Value-Added Services (71%)
Online Advertising (18%)
WeChat Pay & Other Services (11%)
Phones (76.4%)
Hardware (16.2%)
Internet Services (1.9%)
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BATX Business Structure - Baidu
Company Baidu
Date Founded January 2000
Number of Employees 43,500
Market Capitalisation
(US$BILLION)
83.54
Revenues (US$ BILLION) 10.1
Earnings (US$ BILLION) 1.4
Business Units
91.4% Online Marketing
8.6% Others
Key People
Robin LI (Co-Founder, Chairman & CEO)
and Eric XU (Co-Founder)
8,6%
91,4%
OTHERS
ONLINE MARKETING
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Baidu Showcase
Baidu is losing search market share to Alibaba (30%) and
Tencent (12%), dropping to just 21% of the market in
China.
AI leader, starting with autonomous vehicles by
committing US$1.5B to fund it.
NOW VISION 2020
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BATX Business Structure - Alibaba Group
Company Alibaba
Date Founded April, 1999
Number of Employees 50,092
Market Capitalisation
(US$BILLION)
529.22
Revenues (US$ BILLION) 74
Earnings (US$ BILLION) 27.6
Business Units
68.9% Financial Services
26.2% Core Commerce
2.89% Digital Media
1.3% Cloud Services
0.59% Other bets
Key People
Jack MA (Co-Founder & Chairman) and Daniel ZHANG
(CEO)
** Ant Financial revenue is based on previous estimates of transaction volume for Alipay and
other services.
86%
11,2%
FINANCIAL SERVICES**
DIGITAL MEDIA
CORE COMMERCE
CLOUD SERVICES
OTHER BETS
0,25%
0,55%
1,23%
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Alibaba Showcase
Core commerce is still strong for Alibaba, it made US$25.3
billion in one day for its 9th installment of its 11.11 shopping
festival. 90% of those sales came from mobile!
AliPay’s expansion to all aspects of daily life as it battles
TenPay.
It has decreased in market share from 80% in 2014 to
50% in 2017 whilst Tenpay grew from 7% (2014) to 40%
in the same period.
NOW VISION 2020
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BATX Business Structure - TENCENT
Company Tencent
Date Founded November, 1998
Number of Employees 38,775
Market Capitalisation
(US$BILLION)
448.82
Revenues (US$ BILLION) 21.9
Earnings (US$ BILLION) 5.97
Business Units
71% Value-Added Services ( 2 logos -
Tencent Games and QQ Zone)
18% Online advertising ( 3 logos - WeChat,
QQ Penguin, QQ Video)
11% others (2 logos - WeChat Pay, Tencent
Cloud)
Key People
Pony MA (no relation to Jack Ma - Founder,
President & CEO), Allen ZHANG (WeChat
Creator, Head of WeChat)
VALUE-ADDED SERVICES
ONLINE ADVERTISING
OTHERS
71%
18%
11%
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Tencent Showcase
WeChat has 889 million users in China and eMarketer
expects that 84.5% all mobile phone messaging app users
in China will use WeChat this year.
Tencent rolls out more healthcare offerings through
customised health plans and products (iCarbonX) and
digital healthcare (Haodaifu).
NOW VISION 2020
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BATX Business Structure - XIAOMI
Company Xiaomi
Date Founded April, 2010
Number of Employees 15,000
Market Capitalisation
(US$BILLION)
46
Revenues (US$ BILLION) 13.5
Earnings (US$ BILLION) 1
Business Units
76.4% Phones
16.2% Hardware
1.9% Internet Services
Key People
LEI Jun (Co-Founder & CEO), LIN Bin
(Co-Founder & President) and Manu
Kumar JAIN (Managing Director of
Xiaomi India)
HARDWARE
INTERNET SERVICES
PHONES
** Xiaomi is currently privately-held so company data is based on
estimates, aggregated from various news sources.
76,4%
1,9%
16,2%
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BATX Business Structure - XIAOMI
The smartphone for emerging markets but challenged by
other homegrown players like OPPO and Huawei
Refocus on supporting their ecosystem of products to
offer a smart home experience at an affordable price.
NOW VISION 2020
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The BATX’s Way to Innovation
Chinese firms have had a model of
launching multiple teams on similar
product ideas and having them
compete to see which are the most
relevant.
e.g. Haier, Tencent, Alibaba
Business Darwinism
China’s massive market and
relatively lax privacy laws are
enabling its tech giants to use big
data more effectively, launching
opportunties in better AI and more.
e.g. Baidu, Tencent, Alibaba,
Meituan-Dianping
Data & AI Leader
Businesses in China have taken a
broader approach to capture the
consumer at every touchpoint,
moving beyond their core business
to leverage on new opportunities.
e.g. Tencent, Alibaba, Meituan-
Dianping, Didi Chuxing
Ecosystem Bundling
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Dos & Don’ts
China is slow to try new brands and certain businesses
(e.g. education, milk powder, etc.) receive greater
assurance when they are foreign whilst also
communicating the buyer’s purchase ability.
Chinese Brand?
1
Who should you be partnering with (Alibaba, JD,
WeChat, etc.)? Manage your ecosystem to best
leverage on their strengths.
Ecosystem Collaborations?
2
Businesses need to have the right partners to grow in
China and communicate effectively with consumers.
Do not assume that your brand ideals translate and
match the Chinese consumer.
Localisation
1
Chinese consumers enjoy the ability to have “face” by
demonstrating that they are in on a particular deal, etc.
Use it as an opportunity for them to engage and
champion your brand.
Offer something special
2
Selling to the Chinese Market Marketing to Chinese Consumers
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New paradigms – Social Credit System
"Allow the trustworthy to roam everywhere under heaven while making it hard for the discredited to take a single step"
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Who leads the BATX?
The Four Ages of Chinese Entrepreneurs
China’s first wave of pioneers
were often the sole owner of
their businesses and had little
formal education.
Notable player : Haier (world’s
largest market share for white
goods)
1980s
This next wave of entrepreneurs
were previously holders of
government positions who
launched their own businesses
as China opened up.
Notable player : Fosun (an
investment conglomerate that
has bought over companies like
France’s Club Med)
1990s
China’s participation in the WTO
in 2001 drove the growth of
Internet-powered businesses
that bridge China with the world.
Notable player : Alibaba
(originally an ecommerce player,
it has since expanded into areas
like payments, cloud computing
and more)
2000s
Chinese ‘Millennial’ entrepreneurs
combine ‘opportunism with
pragmatism’. They usually have
overseas education experience and
place a strong focus on systematic
business management skills.
Notable player : Didi Chuxing (the
world’s second most valuable startup
managed to remove Uber from
China)
2010s
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The X Factor
MIDU Startups
The Groupon-Yelp hybrid
recently raised US$4
billion to encompass the
whole offline-to-online
experience in China.
Valuation : US$30 billion
Meituan-Dianping
The Tencent-invested
health platform aims to
become your all-in-one
guide to a better, healthier
life through genetic
testing, customised diets
and more.
Valuation : US$1 billion
iCarbonX
After beating Uber to win
China, it is expanding
globally to offer a fully-
integrated transport
solution with investments
in startups like Grab and
Ofo.
Valuation : US$50 billion
Didi Chuxing
UBTech plans to lead the
robot-human interface
future with its humanoid
robots meants for
household and business
use.
Valuation : US$1 billion
UBTech
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Resources to know more
Chat Watch Read
We have 6 half-hour slots available
for you to speak with us to learn
more.
Click here to book yours now!
Book a slot with
Martin
A film detailing the rise of Alibaba
in China and its fight against eBay
to become the first global Chinese
Internet company.
Catch the movie, Crocodile
in the Yangtze
Understand the change that has
emerged from China and how its
leaders are setting the stage for a
new wave of transformation.
http://www.chinasdisruptors.com/
Learn from the book,
China’s Disruptors
http://www.crocodileintheyangtze.com/
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What’s next for your organisation?
Monitor Visit Partner
BATX Ambassador
Director-level partnership with the
BATX to enable your organisation
to leverage on their expertise,
customers and data.
BATX Learning Expedition
An opportunity to interact with the
BATX in China to understand the
opportunities and challenges.
BATX Innovation Monitoring
Keeping an eye on the changes
they’re making and analysing the
business impacts of their
developments