Google’s ex-China Head Set to Fund Chinese High-Tech Start-Ups

Amid speculation over China’s role in the global economic downturn and its economic and geopolitical positioning, China’s aggressive move into high-tech investments is alarming. The New York Times is reporting that Google’s Ex-China head, Kai-Fu Lee has started a new firm, Innovation Works and is poised to finance high-tech start-ups in China. Given Korea’s prior records of nurturing high-tech start-ups, it is enviable that the Chinese not only raise the necessary capital but also mustered up the appropriate people and networks to help start-ups grow in managerial sense.

From the New York Times:

Three days after announcing that he was resigning as the head of Google’s China operations, Kai-Fu Lee said Monday that he had raised $115 million to create a company that would finance high-tech start-ups in China.

That company, Innovation Works, will search for talented Chinese engineers and entrepreneurs and help them develop the next generation of Internet and mobile computing technologies, Mr. Lee said in a telephone interview. …

In a telephone conference call with Peter Liu, chairman of WI Harper, one of the lead investors, Mr. Lee said part of the logic behind forming the company was the lack of early-stage financing of high-tech start-ups in China: angel investors who could provide financing and coaching of young companies.

Talented managers now working for technology companies in China are primed to leave those companies to become great entrepreneurs, he said.

“Our experience is in company building,” he said. “I can coach them with my many years of experience.”

China is already a hotbed of high-tech growth, with fast-growing Internet companies like Baidu, Tencent, Shanda and Alibaba already worth billions of dollars. Venture capital funds are aggressively scouting out new companies that can capture share in what is already the world’s largest Internet market, with over 300 million users…

Despite the economic downturn, Mr. Liu of WI Harper said he had no trouble raising the money for Innovation Works.

“We raised the money in less than 30 days,” he said, and called the hiring of Mr. Lee “a miracle.”


www.nytimes.com/2009/09/08/technology/08google.html