Introduction:

Earlier this year, the Tsinghua Entrepreneurship and Executive Club (TEEC) Angel Fund held its annual investment roundtable discussion at the InnoSpring offices in Santa Clara. An international group of entrepreneurs, investors, and founders had an in-depth exchange investigating Sino-US tech sector industry and investment trends, angel investors, incubator programs, as well as the advantages and disadvantages of the current wave of entrepreneurship. In recent years, more and more Chinese companies are ready to turn the corner and enter the US market. Resource-rich Silicon Valley, the base of tech giants and heart of the world’s high-tech industry, attracts a particularly large number of companies. How can Chinese enterprises best make use of Silicon Valley’s natural resources to break into the international market?

EasyWay (易程股份) is one of TEEC’s prominent high-tech companies. For many years the company has been devoted to developing independant and autonomous reliability software for the high-speed rail industry in China, as well as hardware systems and consumer products.

Presently they are also successfully competing internationally, and serve as a model for overseas expansion. EasyWay deputy director and chief engineer Shao Xiaofeng will share his thoughts on how to maximize SIlicon Valley’s resources and experience in opening the American domestic market.

Q: EasyWay’s achievements in high speed rail have been very successful domestically, but as you currently expand overseas what are the greatest challenges?

A: Actually our greatest domestic advantage is to be able to accurately predict demand. Our work is railway technology; in China projects are normally led by the Ministry of Railways, but in the United States people are more willing to work with the private sector rather than the federal government. In the US, public sector government or national projects happen slowly, the process is complicated, there are many restrictions, it takes a long time, and funding is strictly controlled. But with private sector projects decisions happen quickly, the process is simple, their are few restrictions, time is used efficiently, and funding is flexible. Presently in China large domestic projects are dominated by the government and state-owned enterprises in a combined planned and market oriented fashion. But in the US everything is run by the market - this is the biggest challenge with overseas expansion. You must know the laws and statutes of the country, how to integrate local talent, and how to attract technology and capital.

Q: Internet mobile applications have become much more important recently, how much has this affected the high speed rail industry, and demand?

A: In the past rail was a very conservative industry with high barriers to entry, but nowadays we must make use of new technology and applications to help railway development. Before, in the Chinese rail system we believed we cannot use a real-name ticketing system, because the workload was too great. But the system has now gradually evolved into a real name system. However, even now the system only allows us to check 20% of the real-name system for tickets. There is great pressure because if people are using tickets not in their real name, they can use fake IDs to hand down tickets. We are promoting a plan to increase the strength of the real-name checks, for example, using the wait time to check passengers, using mobile phones to upload client info and verify tickets through face recognition. To prevent people taking photos to scam the system we’ll have them perform a series of actions, for example, touch their nose, touch their hair, or voice recognition. This can be a very interesting process, and at the same time greatly increase the efficiency of our work.

Q: How can Silicon Valley help your industry open international markets?

A: As I said above, the real name system for identifying users, the image recognition, and the voice recognition technology, these require very technology teams to develop and implement. Even though in China there is no lack of technical personnel, its still not mature enough to enter the international market. Silicon Valley has the finest high-tech development and software development, and the leading, most mature application of new tech. EasyWay unceasingly explores new technology and applications, as this is essential for high-speed rail. Because of this we found Eugene Zhang (then-InnoSpring CEO) in order to find technical teams, pool resources, and begin cooperation. In fact, we’ve already started in the US with the Fresno to Bakersfield line, so we need to be more familiar with the US market, technology, and talent, so that we can more easily and quickly integrate into the international market.