His PhD supervisors back at MIT almost kicked him out of the program, he jokes. Back then, China was the ‘sick man of Asia’ and Japan was number one. But Steven saw a country on the up.
“For me, it was a unique, interesting place which was changing a lot,” he says. “It was really opening up to the West.”
Fast-forward 20-plus years and Steven is now an associate professor of entrepreneurship and strategy at Tsinghua University School of Economics and Management (Tsinghua SEM) based in Beijing.
He teaches management courses on the Tsinghua-MIT Global MBA Program, focusing on design thinking, global enterprises and strategic management. He says many of his students are passionate about entrepreneurship.
What makes China unique?
Most budding entrepreneurs in China are attracted by the sheer size of the market—a population of more than 1.4 billion people, and growing.
Average household incomes in China are growing too, so there’s increased demand for more sophisticated products and services.
Steven cites the iPhone as an example. Until China developed its own alternatives, Apple sold the iPhone at a much higher price in China than it did in the US, for example, as people were increasingly prepared to pay for quality.
Opportunities for entrepreneurs in China’s finance and technology industries are well-reported—with Chinese firms jumping on innovations in fintech and artificial intelligence. Other boom industries include healthcare, clean technology and food-tech—tapping into areas where China is still looking to improve.
More than elsewhere, Steven says, China welcomes entrepreneurs. Entrepreneurs with a registered company can apply to stay in China on a special startup visa—in stark comparison to the difficulties internationals are facing applying for work visas in the US.
“If I was looking at the hurdles of getting a work visa in the US compared with China, I would definitely go to China,” Steven says.
Why entrepreneurs should do an MBA
While China welcomes entrepreneurs from abroad, getting started in China is not easy—that’s where being part of an MBA program can help.
Tsinghua University has its own startup incubator, x-lab, which provides students and alumni with free office space in the Tsinghua Science Park, to work on their companies. Students therefore have an address so they can register their companies as well as a deep ecosystem of mentors, professors, industry professionals, lawyers, and investors ready to support them.
Since its launch in 2013, x-lab has worked with over 1,331 project teams, with an average of five-to-10 new teams joining every week. With over 535 startups already incorporated, x-lab helps startups from seed and pre-seed stage to commercial operations and scale-up across all sectors and industries. To date, a total of 196 x-lab startups have raised over $470 million in funding.
Together with the Tsinghua X-Elerator—which has locations in Beijing and Shenzhen—x-lab is funded by both the university and TusHoldings, which is part of Tsinghua Holdings, one of China’s biggest firms.
Students on the Tsinghua-MIT Global MBA can also take part in the Innovation and Entrepreneurship: Insights from Silicon Valley course, which is delivered in partnership with Facebook and x-lab.
The course guides students through every step in the startup process and culminates in a pitch competition where students present their business plans to a panel of Facebook executives and potential investors.
It’s helped some of Steven’s students launch their own businesses—like Spaniard Alvaro Montoya, who started his own business translating and streaming events online, and is now based out of x-lab.
“At Tsinghua, you have access to resources and people—classmates, speakers, and executives,” Steven continues.
“You also get the Tsinghua name—two-thirds of the Central Committee of the Communist Party are graduates from Tsinghua. There’s no comparison in the US, even with MIT or Harvard, because of Tsinghua’s position in Chinese society.
“I hear from students all the time that when people hear that you’re from Tsinghua in China, they look at you differently.
“If you want to take advantage of this, there’s no limit to the potential opportunities.”
Read Alvaro’s story: How I Went From An MBA To An Entrepreneur
How to succeed in China
Steven’s research covers areas including internationalization, innovation, strategy, and M&A. He’s authored eight books on topics like venture capital in Hong Kong and the commercialization of new technology. He's been recognized as one of the top 20 China-based management scholars since 2015.
What advice does Steven have for any entrepreneur wanting to succeed in China?
For internationals, the most important thing is to find someone local who you can trust—building connections is crucial in China. The MBA classroom, he says, is the best place to start.
If you have the support around you, Steven explains, China is a place where budding entrepreneurs can make it big. "If you want to make a billion dollars you have a better chance here than almost anywhere else," he says.
“China is the center of the universe; the frontline of tech development and deployment,” he continues.
“Some of my best friends are from the San Francisco Bay Area, but they are clueless about what is happening in China. They don’t understand the competition they face; they don’t even think they’re in one. But the Chinese do and they’re out to win it.
“China is a place where anything is possible.”