East vs. West - 3 things I learned in Asia that are different from ‘The Valley’

Prior to moving to Asia, I was working with some of the most exciting startups, founders, and investors in ‘The Valley’. After two failed startups, one successful exit, eight equity positions as an adviser or investor, and six years at Apple, I thought it was time to shake it up and make the move to Hong Kong. I’d NEVER been to Asia prior to moving. While it wasn’t my master plan, my wife had a fantastic job offer, I quickly came to realize the unparalleled opportunity that is in the Asian startup scene.

Before coming, I decided to approach Asia with an open mind and give myself one year to learn before starting or joining a new company. I had spent the majority of my career developing business channels and ecosystems for startups, investors, and Apple in the United States and thought I would need time to learn before getting back to executing. But that didn’t last long! After just six weeks, I was off to Chinaccelerator to mentor their startups, Geeks on a Plane (#GOAP) with Dave McClure (@davemcclure), GMIC in Beijing, and GSMA to meet with startups and investors from around Asia. On top of all that, I began to create my next venture, Brinc (brinc.io), with my Co-Founder Manav Gupta (@manavg).

My first instinct was that I should bring as much of ‘The Valley’ to Asia as possible. That was a HUGE mistake! While ‘The Valley’ name is helpful, bringing ‘The Valley’ mentality to Asia was not the way to approach this market.

There have been many lessons along the way, but here are three initial mistakes I made when I first moved from ‘The Valley’ to Asia:

1) Name Dropping: People drop names in Hong Kong just as much as they do in San Francisco or New York. However, the difference is that in those cities, it’s not expected that if you say that you know someone that you’ll be held to making an immediate formal introduction. Here’s an example of what I mean. I said, ‘I’m part of the Thiel Foundation’ to someone in a causal context. The next week, I had a personal invitation that they expected me to deliver to Peter Thiel directly! Yes, this happened to me, and no, Peter did not hop on the next flight to visit Hong Kong.

Lesson Learned: Prove it! Asia is a culture of results, not talk. If you say it, you better have already done it. If you say you’ve done it, you better be best at it. It’s not a place where just knowing someone matters. Families and connections in Asia are DEEP! Suffice it to say that everyone here knows a billionaire, or two, or twenty. It’s not a big deal in Asia and if you say that you know someone, they’ll ask you to prove it!

2) “Old money” doesn’t matter: In San Francisco, it’s ALL new money. When we speak about the “old guard” in SF, we’re referring to people like Jack Dorsey and Mark Zuckerberg. When you speak of wealth in Asia, you’re talking about real money, not “equity”. This is generations of massively distributed businesses and interconnected networks of families that generate more value in a year than the new money entrepreneurs do in a decade. You cannot turn a blind eye to these families and fortunes as they are intrinsically aligned to all aspects of local government, macro business trends, and the majority of the exits that happen in Asia.

Lesson Learned: Real money matters. While ‘The Valley’ trained me to seek out modern investors with the riskiest appetites, working your way into older investors (sometimes family offices) is an amazingly valuable process. You begin to unearth the movers and shakers that make up the majority of the closed-door decisions in your industry and you also learn how to present to investors that expect real returns. These types of ‘old money’ meetings really make you a better entrepreneur and educate you on aspects of your business that you would never learn by following the accepted logic from ‘The Valley’.

3) I Can Figure Out China On My Own: Never were less true words spoken. I’m not kidding. This was my biggest mistake to date. I had been toying with the idea of raising my own fund for years prior to leaving ‘The Valley’. When I moved to Asia, I figured I could easily pull this together with a focus on an emerging market and a growing tech trend like IoT. While I wasn’t expecting to learn Mandarin overnight or start doing deals with the likes of Jack Ma of Alibaba or Terry Gou of Foxconn, I did expect that ‘The Valley’ badge would make doing business here pretty straight forward.

I couldn’t have been more wrong. Doing business in Asia is 100% about relationships (guanxi in Mandarin) and respect. You can play around the edges without much issue, but if you want to do anything of substance here, you need to partner locally. No excuses. Please do not try and refute this, or if you do, I would love to know the specifics of how you did it because I’ve never see it happen.

Lesson Learned: Playing in Asia means playing house rules. Asia is a proud area with rich culture and deep roots. When it comes to business, it’s the religion (especially China and Hong Kong). If you want to play their game, you’re going to play on their terms. For me, I’ve found that the local governments have been incredibly helpful and kind, albeit slower than I’m used to in ‘The Valley’. As I used to love to say at Apple, ‘We’re Better Together’. That statement has never been truer than when it’s applied to doing business in Asia.

For example, when manufacturing products in China for our IoT investments, I thought I could go across the border, meet some factory owners, and get our products made. Yep… I was wrong again! Walking in the front door is the hardest way to make things happen. Once we started partnering with people who knew the factory owners, our lives became infinitely easier and more predictable, which is a critical dimension in being successful at IoT investing.

Long story short, things really accelerated for me in Asia once I decided to stop focusing on ‘how we do things in The Valley’ and I started learning how things are done here. There are literally endless new business practices in Asia that I was never exposed to in the States and I’ve become a better investor and entrepreneur from the process (I’d be happy to write an entire column on these lessons and insights if people want me to).

China has arguably built the largest economy on Earth in the same time I’ve been alive (ever since Deng Xiaoping). It’s a fantastic place to learn some of the most important business lessons of your life. The only way to do this is to ‘Drop the thought’ (as the Dalai Lama teaches) and be open to learning completely new ways of doing business. For me, this meant fully giving up on “how we do things back in The Valley” and learning how to integrate local business practices into my professional experiences from California.

So What Should You Do?

At the end of the day, you can jump over to Silicon Valley and play where everyone else is playing. That’s totally reasonable. Or you can dive head first into the rapidly emerging tech scene in Asia (hopefully Hong Kong) and hustle your way into the history books! While I am forever grateful for the lessons I’ve learned from ‘The Valley’, Asia is happening NOW.

If you’re at a point in your life where you can change it up, I’d highly recommend getting a ticket and checking out what is happening here. If you do, look me up and feel free to stop by our office.

Best of luck and feel free to ask me anything. I’m always here to help!