Page 30 - How China Is Winning the Tech Race

Yahoo!, Oracle, Cisco, and Intel border Highway 101 in Silicon Valley, from
the San Francisco airport to San Jose. The taxi driver pulls into the
entranceway of a corporate tower whose peculiar-sounding name—Ideal
International Plaza—symbolizes the optimistic spirit of China’s new entrepre-
neurial era. Another sign of the country’s rapid economic progress is an auto-
mobile showroom on the ground floor. Here the new China beckons, with
late-model BMWs on display that could turn heads in Beverly Hills.
Upstairs, on the twelfth floor, is the headquarters of an icon of China’s
emerging tech economy: the country’s leading search engine—not Google but
Baidu (pronounced “Buy-Do”). I’m here to interview Robin Li, the firm’s
founder and CEO and one of China’s most famous and successful Internet entre-
preneurs. Li does not have the instant name recognition of Larry Page or Sergey
Brin, the computer nerds who invented Google while studying at Stanford. But
in China, Li is a tech superstar, idolized by hordes of wannabe entrepreneurs.
Li is the mastermind behind China’s biggest and arguably best search
engine, his first start-up. He is a pioneer among China’s young tech founders,
the sea turtles who largely copied American dot-coms, adapted them by
giving them localized features, and made a fortune.
Li owes his stardom to a melding of the Silicon Valley and Chinese
cultures. He cranked up Baidu in Beijing in 1999, raised funds from venture
capitalists in the Valley, and borrowed an idea that made the Bay Area an
entrepreneurial hot spot: stock options for new staffers, most of whom were
young Chinese engineers new to capitalism and entrepreneurship.
Li imitated three high-flying U.S. tech companies before powering up his
final and winning strategy. Like Google in the United States, Baidu became the
go-to place in China for tips on restaurants and answers to questions about
everything from health to physics.
Li then out-Googled even the innovative Google in China. His little
search engine that could didn’t have the resources of the Google machine but
was able to push uphill. Baidu has a speedier and more reliable search engine
that produces more precise searches in the Chinese language Mandarin. It
also offers more localized features, such as instant messaging, a hit with
Chinese Internet users. The home-court advantage and cloning strategy made
Baidu a moneymaker in 2004.
The next year, at record speed even for the fast-paced Chinese Internet
economy, investment bankers from Goldman Sachs in Asia and Credit Suisse

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