Now is a golden time to be involved in China, says Hong Kong entrepreneur behind Didi Chuxing

Now is a golden time to be involved in China, says Hong Kong entrepreneur behind Didi Chuxing

As Uber continues its uphill battle to acquire a authorized foothold in Hong Kong, the American firm’s Chinese rival, which drove it out of the mainland a few years in the past, has introduced plans to develop by launching companies in Mexico.

That enlargement marks one other necessary milestone in a journey that started in 2015, when two firms who offered on-line taxi-hailing companies via the Didi Dache and Kuaidi Dache apps merged to type Didi Chuxing.

What is much less identified concerning the creation of China’s largest ride-hailing agency is that Kuaidi Dache was the brainchild of Hongkonger Joe Lee, and his success is a excellent instance of what can be achieved if the town’s entrepreneurs take their abilities to mainland China.

Lee, 43, is the co-founder of Kuaidi, which merged with Didi to turn into Didi-Kuaidi, and later Didi Chuxing. It purchased Uber’s China enterprise when the US agency deserted the mainland.

A arithmetic and accounting graduate from Waterloo University in Canada, Lee swapped a profession in accounting to pursue a dream and designed the app that was impressed by a need to create a socially conscious product that might enhance the shopper expertise for these needing a taxi on the mainland.

He oversaw the complete Kuaidi operation, from designing the app to beginning the taxi and limo hailing enterprise mannequin from scratch. He is not a programmer by coaching, though a 100-strong engineering crew reported to him.

What are the challenges aspiring Hong Kong entrepreneurs face on the mainland?

I believe once I acquired in there was nonetheless a little little bit of “Hong Kong people premium”, which has been fading in the previous few years.

Hongkongers have a lot of various publicity that they will carry into China – whether or not it is worldwide publicity, professionalism, and likewise the languages.

The Hong Kong premium is coming again as a result of the expansion in China has been very quick in the previous few years, and is now shut to a plateau level. All the companies require extra innovation, breakthroughs administration. So, I imagine this is a golden time for Hongkongers to seize the alternatives in China, however you want a totally different sort of talent set.

For instance, should you break down fintech, it means finance and know-how. The technological innovation in Hong Kong is not as in depth as on the mainland, however enterprise mannequin innovation is good. To be good in fintech, not solely would you want cutting-edge know-how, you additionally want innovation in the enterprise mannequin.

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If you take a look at the InnoStar awardees, lots of their companies have been born in Hong Kong. For instance, GoGoVan and Didi are in a very related business. However, we transport human beings and passengers and so they transport items. I believe they acquired a good concept. Steven [Lam, co-founder and chief executive officer of GoGoVan] did it very nicely.

I exchanged concepts with him in some unspecified time in the future. I advised him that once I promoted the taxi app in China, I did copy a few of the techniques that he used.

There are a lot of creativity and innovation concepts in Hong Kong. It’s simply a matter of the way you execute it, how you propose it out, how you’ve gotten a very clear objective that you desire to to obtain.

Do Hong Kong rules discourage share rides and automobile hailing?

We have to have a very clear goal of what we want to obtain as a enterprise. For instance, in our taxi and car-hailing enterprise, we’ve got a very clear goal that we would like passengers to get a automobile. We need the drivers to make more cash.

This is a quite simple but very robust view amongst us at any time when a enterprise has any deviation from the unique coronary heart of what we want to do. I can’t fairly remark concerning the Uber enterprise in Hong Kong, as a result of I’m not very accustomed to that.

However, to have social good as the unique purpose for doing your enterprise, you must domesticate your enterprise in a means that addresses the curiosity of all of the stakeholders, together with passengers and drivers, the federal government, vested curiosity events, all of them.

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When we did taxi hailing in China, we began off as a taxi-hailing app as a substitute of the Uber car-ordering app. The purpose we did that was so easy. We knew that we have been going to have some form of affect on this market.

At first, we had to persuade individuals we have been going to add worth to this specific market. So, when the taxi drivers are blissful, the taxi house owners, and taxi firms are blissful, and the federal government sees this as a plus to society and are extra embracing of our enterprise mannequin.

We launched in Hong Kong in 2014. First we began in Shanghai, after which as soon as we acquired 100 cities, we moved to better China, together with Hong Kong, Macau and Taiwan. In Southeast Asia, it’s referred to as Grab.

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What are you engaged on proper now?

I based Klover Insurtech, an internet platform for motor insurance coverage on the mainland. One of the largest points with the insurance coverage business is the legacy left behind from earlier enterprise fashions.

However, for an insurtech firm, we don’t have a lot of legacy points, and we’ve got a very clear goal: we want to create worth for policyholders. Our enterprise has underwritten 700 million yuan (US$110 million) in China in motor insurance coverage alone.

What makes your enterprise stand out from the standard opponents?

To many of the public, they really feel that insurance coverage firms generate income out of each single dime – they delay declare payouts, they save from skimping on companies they supply to the shoppers. This is a zero-sum mentality. I believe it’s time to have a win-win mentality as a substitute.

This is a zero-sum mentality. I believe it’s time to have a win-win mentality as a substitute

Joe Lee, entrepreneur

My view on insurance coverage is easy. If you’ve gotten a main accident, the insurance coverage firm ought to compensate you financially. However, what insurance coverage firms don’t do nicely, or can do higher, is when you’ve gotten minor incidents, and even nothing to declare. I believe insurance coverage firms ought to reward these drivers, both via service or charity.

We have to break the zero-sum mentality. One of the methods is to simplify procedures. Sometimes, after we purchase motor insurance coverage, we’re requested to fill out a type which asks questions we don’t even know the solutions to, such because the engine variety of the automobile we’re making an attempt to insure. My view is that know-how may also help out in these situations.

It is true that insurance coverage firms are making a lot of cash proper now, however once I spoke to them in addition they acknowledged the necessity to change. For instance, in phrases of shifting to the digital period, they realise the necessity to have a service community to serve their clients higher. They know huge information can improve their pricing effectivity, or underwriting effectivity.

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Are there plans to develop your enterprise into Hong Kong, and what do you consider the enterprise setting right here?

We would love to come to Hong Kong. I imagine in the previous few years we’ve got realized and constructed a very stable basis in phrases of know-how, enterprise mannequin, and expertise. The solely problem for our insurtech platform in Hong Kong is that we’ve got to spend extra time to perceive the town’s rules.

The Hong Kong authorities is very open in this space. The Insurance Authority has a fast-track utility for insurers to receive a digital licence. The Innovation and Technology Bureau is very open to fintech. When I spoke to the chairpersons of the Cyberport and the Science Park, they particularly welcomed abroad Hongkongers coming again to begin insurtech and fintech firms.

I’m pleasantly shocked by their enthusiasm. It was not simply a handshake kind of assembly – they advised me to allow them to know the issues we have been having, and so they pledged to assist out.

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What recommendation would you give to aspiring entrepreneurs and start-ups in Hong Kong?

They shouldn’t be restricted by their identification as a Hongkonger. I believe there’s no distinction between a Hong Kong man, a Shenzhen man or Shanghai man. It’s all about your enterprise concept: it wants a very clear motive, and a plan on how to execute it.

A typical downside which I see from individuals founding a start-up is they assume as a result of they’ve a good concept, they’ll be ready to increase cash.

But, once I requested them to inform me a few of the potential issues they might be going through, a lot of them couldn’t even reply. My methodology is, don’t inform me what is good about your self, inform me your issues as a substitute.

When I spend time with college college students or entrepreneurs, I inform them: “You have your dreams, but you still live in the real world.”


What hobbies do you’ve gotten?

I spend fairly a little bit of time enjoying piano and guitar through the weekends. It’s how I relieve my stress at work. I additionally made cash from enjoying in a band at pubs and eating places once I was in college in Canada.

Who is your idol ?

I don’t have a single hero in my thoughts. I have a tendency to assume that I’m a superb learner, and I be taught on daily basis. For some individuals, you’ve gotten a hero, and also you need to be taught from them. But to me, I can see the great in all people. In my pocket I don’t carry a pockets, however I’ve my Kindle as a substitute. I spend a lot of time studying books as a result of you probably have a hero you need to be taught from them. When I used to be small, I appeared up to my father and my mom. There is a Chinese proverb which says, ‘When three people walk together, there must be one who can teach me’.

How a lot time do you spend on the mainland every week ?

I spend two days a week in China now, a lot much less time than earlier than. I’ve been in Hong Kong extra for the previous few years as I strive to concentrate on fintech investments in the town, which I imagine has a distinctive benefit.

Do you propose to retire any time quickly?

I’ve by no means thought of retiring, as I imagine I’m removed from profitable in phrases of the social values my companies are creating. I’m nonetheless studying books closely, and continue learning. Also I spend fairly a little bit of time with the enterprise and social initiatives in which I can add worth.

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