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If at First You Don't Succeed
One entrepreneur's attempts to start businesses in the age of innovation
By Liang Xiao | NO.34 AUGUST 23, 2018
Li Gejing (COURTESY PHOTO)

Throughout the interview Li Gejing kept returning to the phrase "a sense of crisis." "I wonder whether people born around 1978 like me always feel a sense of crisis toward the great changes in our society over the past 40 years," said Li, co-founder and General Manager of Qingxi Culture, during an interview with Beijing Review.

As an experienced entrepreneur, someone who has either succeeded or failed with two, three, possibly even more projects and business models, Li believes that it is precisely this sense of crisis that has pushed Chinese entrepreneurs to learn new things.

"Only by doing so can they ensure that they are always in touch with society and never behind the times, even if their projects fail," Li said.

A new start 

Born in Zhengzhou, capital of central China's Henan Province, in 1978, the year when China adopted the reform and opening-up policy, Li was among the first of China's one-child generation after the country began to implement its family planning policy. The improvements to material life brought by reform and opening up to ordinary households and the care he received from his parents allowed Li to enjoy more freedom while growing up. As a fan of painting, he decided to choose art and design as his college major and eventually enrolled in the Beijing Institute of Graphic Communication.

After graduation, Li found a job at a state-owned publishing house, mainly designing the covers of train timetables. For many, it was considered a good job with stable pay in a promising industry.   

But for Li the work was tedious and the pay was far from ideal. "Most of the work was repetitive, designing the train schedules over and over again, and the salary was fixed, which meant that no matter how much work you did, you got paid the same."

His salary was 1,600 yuan ($232) per month, which was not particularly low for the time, but compared with his classmates who found employment at foreign-funded companies and earned monthly salaries between 5,000 yuan ($725) to 8,000 yuan ($1,160), the remuneration felt insufficient.

A serendipitous conversation with a 40-year-old worker at the printing factory in 2005 transformed Li's feelings toward the industry. The woman told Li that the rise of digital printing eliminated traditional printing technology in just a few years, and many workers skilled in movable type printing techniques lost their jobs almost overnight.

This interaction made Li begin to consider his future. "If we just stay in one place, we don't make any progress," he said. Li quit his job at the publishing house at the age of 27 and found a new job at a large media group working as a fashion magazine editor.

After working for a while at his new job, Li began to notice that among white-collar workers in his office building there was an increasing demand for high-quality lunch food. But the time people had for their lunch break was limited and there were few establishments offering take-away services. Many were left with no choice but to buy food from unlicensed vendors.

Noting this as a potential business opportunity, Li, along with some friends, set up a restaurant with an in-house delivery team offering take-away services. Customers could order food by phone, and the delivery men at the restaurant would deliver it directly to their door. As the orders rolled in, the delivery service gradually expanded its scope and began to deliver food from other restaurants as well.

Yet the restaurant was short lived, driven out of business by high operation costs. "If we had done it two years later, it would have been a different story," Li said.

The alternative sequence of events to which Li refers is the boom of online platforms that erupted onto the scene in the late 2000s, such as Ele.me and Meituan Waimai, which have attracted huge rounds of investment in the past few years to arrive at the forefront of China's new digital industries.

"The lesson I drew from this is that timing is crucial to starting a business," Li said.

However, his restaurant endeavor does not count as his only real attempt at a startup. In 2011, as smartphones started to become an everyday part of people's lives, a new upsurge in entrepreneurship and innovation was ignited by this new industry.

Li quit his job again and embarked on a new business plan with Jin Xin, founder of Visual China Group, a leading visual content and integrated marketing solution provider in China.

Li and Jin toyed with ideas about what to develop­­—from an accurate speech recognition system to a live video app. Finally they narrowed down their project to a short video platform in an attempt to explore a new mode of online entertainment.

In September 2014, Premier Li Keqiang called for "mass entrepreneurship and innovation" at the Summer Davos Forum. Several months later, the term was written into the 2015 government work report. The Chinese Government adopted a series of preferential policies encouraging entrepreneurship and innovation, making it the new focus.

But Li's project failed in 2015. "It took me over two years to start my company," Li said. "We got seed investment, angel investment and A-round investment, but ultimately it failed."

Changing times 

The way Li sees it, the factors behind this failure lay with people rather than the business model itself. He posted an article online about the lessons he had learned, and began offering advice to other entrepreneurs based on his own experiences while seeking new opportunities at the same time.

"This period of time was a learning process," Li said. "I've learned to see other projects from the perspective of investors, which is very different from the perspective of an entrepreneur."

In October 2017, President Xi Jinping, also General Secretary of the Central Committee of the Communist Party of China (CPC), said in his report to the 19th CPC National Congress that the principal contradiction facing Chinese society had evolved into the incongruity between unbalanced and inadequate development and people's ever-growing need for a better life.

Li had also sensed this change and noticed that shifting consumption habits in China represented a valuable business opportunity. At the end of 2017, he targeted the culture and tourism industry and started his next venture.

In 2015 and 2016, the tourism industry contributed more than 10 percent to China's GDP, and Li foresaw a growing demand for diversified types of travel in the future. His new business creates a style of travel that combines culture, technology and tourism.

His company has already signed contracts with three tourism zones and started promotional activities. It is expected to go into operation later this year.

What troubles him most now is insomnia. "The cost of running the business is several million yuan each month and this has put a lot of pressure on me. I believe the situation is the same for almost every entrepreneur in the early stages of starting a business," he said.

Despite the ups and downs, Li still believes that being an entrepreneur is the most stable job, as it pushes him to stay abreast of changes in the world no matter how fast they occur. "As long as a person keeps learning and making progress, they will never be left behind," he said.

Copyedited by Laurence Coulton 

Comments to zanjifang@bjreview.com 

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