China is known for its tough stance on its domestic cryptocurrency market despite its positive tone on the blockchain technology scene. For the past year, I have worked for 3 blockchain startups in China and witnessed the boom of the whole industry in this country that values getting ahead in advanced technologies.
There was the super weird experience of getting into a state-back blockchain company that has a “double identity”. There was the routine of community building in a extreme crypto-driven market that does not care about the technology itself at all. There was also the great joy from finding a great team of people that actually care about moving blockchain forward.
It is with continuous doubt, confusion and occasional pleasant surprise that one goes on in the chaotic scene in this emerging industry in a policy-wise restrictive country. However, the experience on its own would be quite different from what most people would imagine from an outsider’s perspective, and there are quite of few lessons that I learned from this journey which could in turn be useful advice for other people that I would like to share.
Being a blockchain company does not mean having a “blockchain mindset”
Building a blockchain startup means at least on some level that the founder team believes in the future the technology can build or has a vision of the world and the technology is a part of it. One can sense easily if a company is living in the future breaking new ground or dwelling in the past reinforcing the obsolete. This is expressed through the company’s culture, the company’s mission statement, and through the group of people the company hires.
Anyone can build a blockchain company with a good tech team, but if you don’t have the proactive, passionate, and positive mindset that corresponds with the world-changing technology, you are going to have a hard time convincing people that what you are doing is actually going to change the world.
I briefly worked at a very prestigious blockchain company with a national defense tech background, and the project itself is also backed by the local government. That actually makes it probably one of the most competitive company in the blockchain space in terms of tech R&D not just in China, but in the world. I knew this would be a great platform for me to use my skills to help the company grow its operations to a global level. But later, I realized although the company has one of the strongest teams in the blockchain space, it suffers from what so many Chinese old-fashioned startups are plagued with — bureaucracy.
Here you may ask: how can a blockchain startup be old-fashioned? Or even just how can a startup be bureaucratic in its nature?
The answer is not as complicated as the question might seem. Let me break it up for you. The strong tech background of the company is no joke. Last time I checked, their tech team has one of the highest if not the highest number of PhDs and Masters in the blockchain space globally. And remember that I said about this company’s prestige? These tech people have an almost myserious background in a Chinese military defense technology university (I won’t reveal the name for obvious reasons). So what I’m saying is, their tech credentials are solid.
However, it is the exact background that makes the team lack the agility, rigor, and the excitement that is more naturally found in a garage startup in the US. An American blockchain startup may shy in their tech strength, but their passion, voracity and the dying desire to succeed are unmatched by the bureaucratic, high-profile counterpart that’s been molded through years of conservative government hierarchy.
They may very well be superior in their tech credentials, but in a rapidly evolving field like blockchain, passion and agility trump cumbersome bureaucracy. A couple of days ago I checked how their community has been, well, except for the paid followers, their community has not moved an inch.
Lesson 1: in an emerging field such as blockchain, you can have the most qualified tech team in the world, but you can’t beat your competitors without passion and vision backing up what you do.
You are building a blockchain company, c’mon… Make it global!
Blockchain technology is decentralized in nature. It’s supposed to break down artificial barriers such as borders and restrictive policies. The fact that so many blockchain startups can sweep through a global audience in such a short amount of time is very new to the traditional Internet space. Traditional Internet companies usually have to face government restrictions when expanding to an international market and often would hence lose to local competitors. Blockchain companies however, by the very essence of the technology itself, can grow globally with much less restrictions.
A blockchain startup needs to build a community of developers, fans, and users on its applications, cryptocurrency, and technology globally if they want to take full advantage of the technology.
This however is not a very familiar concept to many Chinese startup communities. I have seen many Chinese blockchain startup trapped in the paradox of growth — they want to grow their community, yet they do not want to expand globally. The two are not exclusive to each other, yet it is clearly a mindset that inhibits thinking big.
Also, there’s a cultural barrier here. That is, there requires a higher level a transparency to the business that Chinese startups are not used to providing. In the liberal-democratic western market, business transparency is a well-founded practice. Yet most Chinese companies lack expertise and cultural awareness in this respect. I have met many Chinese blockchain startups that are limited to a domestic market without sufficient overseas operations cultural awareness. They do not know what “transparency” means, nor do they have the human resources to realize it. It might sound like a surprise to you, but the use of global social media such as Twitter, Medium, and Reddit among Chinese blockchain startups is only a recent phenomenon. The Chinese blockchain space has a massive need for talents in this area.
It is therefore more often to see that western blockchain startups enter the Chinese market than to see Chinese blockchain companies address a global audience.
In the company that I have lastest worked for, I see this cultural barrier taking its toll. Having been both on the western side and the Chinese side, I had to articulate repeatedly to my boss and my co-workers a sense of cultural awareness and the importance of transparency with the community. More importantly, I go greatly length in making sure that it is rigorously executed in our products and communications with our community as well. This takes a lot of time and patience.
The good thing about it is, it bears fruit. Now we see more and more blockchain communities in China participating more and more in global activities. I can see it is no longer the case that western blockchain startups are tirelessly hustling to expand globally while their Chinese counterparts continue to stay provincial in their mindset and practice. More and more, there are pioneers in the blockchain industry that Chinese blockchain startups are no longer complacent with their already huge domestic market but coming together with international communities to solve global problems.
We see EOSForce addressing Block Producer collusion on the EOS blockchain, and we see Chinese communities participating in the global BP Summit.
This is progress. This is how blockchain technology should be used.
Lesson 2: Go global, blockchain technology is much more effective used globally than restricted to a small group of people with little transparency.
If you ask me the most valuable lessons I learned about building businesses and the blockchain space over my experience in the last 3 blockchain companies, the above would be the big ones. But there are countless small lessons that made the whole journey all the more valuable as well. Things like:
- Make connections — blockchain space is small, it would very likely just take 1 or 2 friends to introduce you to the person that would give you the opportunity you want. So don’t be afraid to meet new people.
- Don’t be afraid to show your talents — this is definitely one of the most helpful tips that have helped me grow faster. Since blockchain is just an emerging industry, there is a huge talent pool waiting to be filled. If I had been hesitant to show people my skills and talents, I would not have had the opportunities to land the three jobs over this past year and gained the insights on the blockchain space in China and globally in general.
- Stay true to your own vision — there are so many things happening in the field of blockchain. So many people with their own dreams. If you are confronted with a good opportunity but does not take you where you want to be, you can say no. Keep looking, don’t settle. You will get there as long as you keep working and your goal in mind. The blockchain space is small enough yet big at the same time.
So these are the few lessons that I have learned over the past year through experiences in the tumbling world of blockchain space in China. What do you think? Does it reflect your own experience? Post your comments below. I would love to hear your stories!
Who am I?
My name is JC. I’m a blockchain marketer based in China. I have worked in the blockchain and crypto space for over a year and right now am helping Chinese and western businesses with their global expansion. Before that I was a social media influencer educating people on cryptocurrency and blockchain. Otherwise I like to write about blockchain and crypto.
Feel free to connect with me on Twitter: @jc_zhang_
My previous articles:
Why the Crypto Dream Does Not Work, For Now
Lessons from the Most Popular Crypto-Based Application
The Economics Behind ShapeShift’s Membership Backpedal
Making China the Biggest Blockchain Market in the World