A venture capitalist told CNBC that Chinese technology companies are trying to expand overseas while marking a shift in perspective among companies in China.
According to a managing partner at venture capital company MSA Capital, Ben Harburg, this shift appeared as a part of competitive pressure in specific sectors and China’s tighter regulatory investigation on technology.
Ben Harburg’s speech in details
At CNBC’s annual conference, Harburg said that it’s also forcing Chinese companies to think about going global.
A few years ago, Harburg said that his venture capital company worked with mature cross-border e-commerce firms. However, he added that today, early-stage firms in sectors from AI to health care are thinking about planning their globalization strategy.
Harburg said that such Chinese companies might find that their marketing models work particularly in emerging markets.
He also said that Chinese business models are considered global best methods, particularly for emerging markets. He explained that the reason it happens is that the way Chinese consumers developed with technology is way more reminiscent than the next wave of consumers in Pakistan, India, Nigeria, Egypt, and Brazil.
There are only a few examples of Chinese tech companies gaining success overseas in the past few years. However, there has been a surge in China-based tech companies expanding their international businesses in more recent times.
By market share worldwide, the third-largest smartphone player is Beijing-based Xiaomi. It resulted from high gains in India. Another example is TikTok, owned by Chinese tech company ByteDance, with a billion monthly users worldwide.
Chinese fashion brand Shein is among other Chinese companies getting the attention of Western consumers.
In the meantime, tech giants such as Tencent and Alibaba keep expanding their overseas businesses.
Harburg said that in his opinion, this is just the beginning of China’s expansion into these markets.
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