Analyse Asia 44: The China Ecosystem with William Bao Bean of SOS Ventures

In Episode 44, William Bao Bean, partner of SOS Ventures and Chinaccelerator, joined us on Analyse Asia to discuss how their accelerator and venture fund spurred the entrepreneurial ecosystem in China. We discussed the interesting companies under his portfolio, how they are working on growth hacks in Wechat and also why media is an exciting category in China. Finally, he also shared his thoughts on the ecosystem in China from the cultural attitudes, the specific hotspots from Zhongguancun in Beijing to Shenzhen and the new wave of mergers and acquisitions under the Baidu-Alibaba-Tencent (BAT) axis.

[soundcloud url=”https://api.soundcloud.com/tracks/214495072″]

Here are the interesting notes and links to the discussion (with timestamps included):

• William Bao Bean, partner of SOS Ventures and Chinaccelerator (LinkedIn, @williambaobean, personal blog, Angelist)
• Career of William Bao Bean [0:44]
  • How did you get started in venture capital, understanding that you have started from equity research?
  • From Softbank to Singtel Innov8: what are the lessons learned during his tenure in these firms? [1:44]
• SOS Ventures & Chinaccelerator in China [3:18]
  • An introduction to SOS Ventures and Chinaaccelerator:  SOSventures (founded by Sean O’Sullivan – his initials formed “SOS”)  is a USD$235M evergreen fund known as the “Accelerator VC” with six partners running five global accelerator programs: HAX for hardware in Shenzhen, Indie.bio for biotech in San Francisco and Ireland, Food-X for food in New York and Chinaccelerator for Internet in Shanghai.  SOSventures invests in over 140 companies per year and over its 22 years has a net realized IRR of 36% putting it in the top 3% of VCs in the world. Chinaccelerator invests in two batches of 10 startups per year in the Spring and Fall.  The focus is on Internet, helping companies from China and across Asia attack the global market and companies from across the world enter China and Southeast Asia.
  • How did William end up joining Chinaccelerator and also become a partner for SOS Ventures? Why is SOS Ventures different from the other venture capital firms? How is compensation done for a partner there? [8:30]
  • How does Chinaccelerator work? How does the accelerator work? How many companies have the accelerator funded? [11:30]
  • William’s view of accelerators in China: “In China, incubators are out of business but the accelerators are thriving.” [14:30]
  • How many companies do Chinaccelerator fund per batch? What’s the amount that SOS Ventures invest in each company and what happens after demo day? What is the success rate? [15:50]
  • What are areas of coverage that William are interested? His focus on cross border with media, mobile commerce with messaging apps unique to China, Japan and Korea, mobile games, mobile advertising. [16:28]
  • What is William’s investment thesis? [20:08]
  • Why is media startups scalable in China? [25:12]
  • What are the interesting recent companies that William have funded in China? His approach is focused on good founders and building an ecosystem.
    • Neonan
  • A discussion on how cooperation on Wechat growth hacking spurred within William’s portfolio of companies.
• Startup Ecosystems and Venture capital in China [29:25]
  • With your previous experience funding companies in China and India, are there any differences within each ecosystem, for example, cultural attitudes between founders? [29:25]
  • How are other areas/provinces such as  Shanghai, Shenzhen are shaping up against Beijing? Are there areas of specialisations beginning to show up, for example, hardware in Shenzhen? [35:36]
  • How does the big companies such as Baidu, Alibaba, Tencent affect the startup ecosystem via mergers and acquisitions? [38:15]

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