My takeaways for Brazil tech entrepreneurs after visiting China

I recently took a trip to China with over 50 other entrepreneurs from Brazil. Monashees organized the trip (Monashees Week) and we visited the top tech companies in Beijing, Shanghai and Hangzhou. Visits included incubators/accelerators, several early stage startups, Didi, Xiaomi, Tencent, Alibaba and others.

The goal for me during this trip was to see things from a different perspective. I figured out from an early age that if you physically insert yourself into other environments, it forces you to have a changed perspective. This has been one of the motivations for me to travel and live abroad for the last 13 years.

Here are my top takeaways from the trip:

1) Speed is taken extremely seriously in China

This was a recurring theme on the trip. The Chinese entrepreneurs and companies are obsessed with speed. I don’t think I had one conversation where speed wasn’t mentioned in the context of what is important to building a startup. This can be summarized as a “deep sense of urgency.”

Takeaway: After spending years in Brazil and Colombia, my reflection is that the sense of urgency isn’t high enough. This really impacted me and made me realize that I had been going too slow the last couple years.

2) Copying is celebrated, but there are some signs of innovation in China

I had a little trouble with this when I went to companies like Xiaomi and Baidu. From the product packaging at Xiaomi looking exactly like Apple to listening to the founding story of Baidu and knowing an almost identical story of Google, the Chinese unabashedly copy whatever they think is good. And they seem to nail it. I did see some signs of innovation whether it was the marketing strategy of Xiaomi or the insanely complex ecosystem of wechat when we visited Tencent. So far China is much more of a copycat producer, but I see they are identifying opportunities to adapt to the local needs and this requires innovation. Connecting to the first point, one of the reasons why I believe they are so fast is because they copy, but I believe they reach a point where they copy, build something good and then need to build something better.

Takeaway: Being inspired by other companies can be good, but make sure at some point you start catering more to local market needs and if you do inspire yourself by other companies, make sure that the local market wants what you are building (obvious, but not everyone does this).

3) China tech companies are thinking big

This is something that I want to implore my fellow tech entrepreneurs in Brazil to do more of. I was recently on a panel at Endeavor’s CEO Summit and I remember something that a friend David Velez (Nubank Founder) said, “In Brazil many people say it can’t be done, or “n?o pode fazer isso”. We need to start developing a mentality of “Fuck it! Let’s do this!”

Why aren’t we building bigger, more disruptive companies!? You don’t have to be completely disruptive from day one, but you should have a vision that is transformational. At VivaReal, we see a future that empowers home buyers to make better decisions. I feel like we have only completed 5% of what we were set out to do. The next 10 years are going to be really exciting.

Takeaway: Expand your vision and dream bigger.

4) Funding is readily available in China

I visited an online real estate company that had raised over $500m USD in the last year! The access to capital is impressive, but I think this is partially a byproduct of Chinese entrepreneurs going after larger opportunities. In Brazil, we aren’t setting our sights high enough.

Takeaway: I realize that there is also a lack of exits that need to happen to validate that the Brazilian market can in fact support a juggernaut and consequentially raise big money to go after a huge sector. I’m convinced we are in the middle of this happening right now. I plan on continuing to invest in Brazil over the next couple decades. I am a believer and I don’t want to hear any more excuses from people about lack of access to capital. The other day I spoke to a struggling entrepreneur that told me I had an unfair advantage because I had contacts in the Silicon Valley. I quickly reminded him that I left my small town of Sebastopol, CA (population of 7,000) when I was 18, didn’t attend a top tier school or do an MBA and didn’t know one person from the VC world when I started VivaReal. We bootstrapped it for years and after being rejected dozens of times by investors, we broke through. Pure determination. It’s not easy, but suck it up and stop crying.

5) There is a strong top down mentality in China

I need to go deeper into this, but my impression was that there is a major top down mentality in the China tech scene. I think this is partially related to the copying (it’s most likely cultural). When you copy, you have more clarity. With more clarity you are faster because you know exactly what to do.

My experience as founder and CEO, I have swung the pendulum to both sides. I have been quite forceful at times where I state exactly what I want and avoid tons of discussions and then there were other phases where I was hands off making room for many people to take the lead. I have been thinking a lot about this recently. I touched on the copying, but I think that I was much more top down in the beginning of the company regarding what needed to be executed, and together with my cofounders we really set the tone with what we expected regarding the culture (that should always be top down because it needs to capture the DNA of what you believe). I had clarity on what we needed to build, we couldn’t veer off course or we would lose time. Speed is the ultimate competitive advantage for a startup, especially one that is competing with larger players. This is why vision is so important. If you don’t have a clear vision, you can’t make quick decisions because you don’t know if they support what is good for the company long term.

Takeaway: As the company evolved and we built out a larger, more experienced team, my belief is you need to create room for your management team and if you micromanage really smart people, you will push them away.

Bonus reflection: When I was on a panel in Beijing with 3 other entrepreneurs, we were asked a question that I found thought provoking and especially enjoyable considering I was being asked this question in China days before the recent US presidential election. I won’t make this a political rant, but the question was, “If you had to choose one, would you say building a company is more of a democracy or a dictatorship?”

My response was that building a company is a benevolent dictatorship where you need to empower and listen to everyone in your decision making process. This doesn’t mean that you need to make all the decisions, but someone needs to set the vision for the company. Democracies are slower and take too much time to change. This doesn’t mean that you should steamroll people with your ideas and be a total tyrant. Quite the opposite. As a founder, you are working to serve your team and the way you serve your team is that you make sure that you gather the best ideas and then set the company on the right track to be able to execute on a bold vision. Your vision isn’t something that you just dreamed up one day, it is the sum of your experiences and input you receive. You don’t need to tell everyone what to do, but you need to tell everyone where you want to go.

Big thanks to Eric Acher and the Monashees team. Natasha Hazan did an impeccable job at organizing everything, but really the entire team was great.

All photo credit goes to Daniel Cukier https://www.flickr.com/photos/danicuki/