The success stories of technology entrepreneurs in China such as Jack Ma of Alibaba have inspired many in the country to put up their own businesses in the hope of hitting the big time. Hopeful technology start-ups are not without a logical basis for their motivation to venture into technology. Official data show that revenues generated by technology firms in Beijing’s innovation hub Zhongguancun alone reached US$ 333 billion in the first eight months of 2015, indicating a 10.8 per cent year-on-year growth. Furthermore, the government has called for mass entrepreneurship through the pronouncement of Premier Li Keqiang, who supports his words with tax breaks, grants and subsidised technology parks.
The whole picture concerning technology start-up firms in China is not without challenges, however. As a matter of fact, it has been said that 90 per cent of start-ups fail. Although a variety of factors may account for the failure of start-ups, it is quite safe to argue that start-ups fail because they are often trapped in the realm of lack — lack of access to the market and lack of funds. As new kids on the block, they are not yet known in the market they intend to enter, and consumers, like most humans, have a propensity for avoiding the unknown. On the other hand, their lack of funds or access to funds keeps their businesses from remaining afloat.
The hope for start-ups, then, lies in the opportunity to showcase their products and have access to fund sources, be they traditional (venture capitalists) or non-traditional (crowdfunding). Providing start-ups with avenues to make their products known to potential consumers and sources of funds can help them take their businesses from the path of failure to the path of success.