The New Silk Road Pt. 2 : Hardware

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Huaqiang Electronic World in Shenzhen, China

China as the Gateway to Launch a Consumer Electronics Startup

The route of the Silk Road covers around half of mankind from a population standpoint. I mentioned the investment in internet technologies but there will also be new roads, ports, and better ways to deliver goods and services to those populations. The focus here is on goods. Shenzhen, the world’s capital for making electronics, is only a quick hour drive from massive ports in Hong Kong and a 2 hour flight (with 17 per day!) to the center of the New Silk Road in Xi’ian.

With the infrastructure rolling out from south China like a red carpet, it’ll be extremely easy to connect a consumer electronic device to any market along the New Silk Road. Incubators such as Brinc and HAX are going to have increased value over the next few years as they continue to give access to the top consumer electronics startups from around the world that need to take advantage of the areas manufacturing know-how. It’ll be interesting to see how Shenzhen/Hong Kong’s startup scenes change as this economic policy matures.  

Next up: I'll finish up these posts on the New Silk Road with a look to some of the lesser-known startup ecosystems that stand to gain a lot from China's new economic policy. 

Have you traveled to Hong Kong, Xian, or Shenzhen and have some experiences to share? Building a hardware startup that is looking to take advantage of the knowhow in China? Feel free to leave a comment!

The New Silk Road

Mapping China's New Silk Road

A few months ago, the Financial Times published an article on China’s new economic policy known as the “New Silk Road”. Announced in Kazakhstan in 2013, the plan has focused on ways to strategically use China’s overcapacity in manufacturing. This plan is comprised of a number of trade deals and large infrastructure investments along a route that’s nearly identical to the original Silk Road from hundreds of years ago. After reading through this, there’s a few highlights that I think are particularly important when looking at this from the angle of startups. The first one I wanted to look into is what this plan means for ecosystems outside of China that might be off the radar. 

New Regions to Focus On

A few rapidly emerging technology ecosystems are part of China’s path for the New Silk Road. Markets such as SE Asia, Central Asia, and East Africa are all places that have been largely ignored up until now by tech companies as viable markets to launch products in. Markets such as Indonesia, Kenya, and Pakistan are all places filled with young, mobile-first populations and rapidly-growing middle classes. They are also all English speaking countries. It’s important to think that these countries will be receiving large infrastructure investment from China, increasing bandwidth for mobile and high-speed internet penetration to businesses. Entrepreneurs that are looking for big areas of disruption should take notice of these countries in particular as the infrastructure investments continue. Also, incubators like Skystar (Jakarta), 88mph (Nairobi), andPlan 9 (Lahore) will be good places for international teams to go to learn about what’s happening on the ground. 

What other ecosystems might see growth from China's plan? Do you have any experience working in any of the ecosystems I mentioned above? Feel free to comments with thoughts, opinions, or your personal experience. 

Next up, I'll be exploring what these changes mean as China looks to stake it's claim as a consumer tech hub.