Former Google China head invests in Chinese startups

Kai-Fu Lee's business incubator Innovation Works is funding 12 startups that largely focus on the mobile Internet

One year after leaving his position as head of Google's China operations, Kai-Fu Lee is funding a dozen startups with his new company Innovation Works to seize on opportunities with China's booming Internet market.

Lee is CEO of the business incubator, which he founded last September. Innovation Works is focused on tapping the potential of China's mobile Internet and e-commerce markets, as well as gaming and cloud computing that it believes will usher in a new phase of growth.

As part of those efforts, the investment company is backing a new Android-based mobile operating system called Tapas, set to launch in China later this year, along with an iTunes-like program for smartphones and a mobile app to edit photos.

"We are clearly after the Chinese Internet opportunity," Lee said during a news conference on Monday.

Lee founded Innovation Works to foster a new wave of Chinese high-tech companies amidst a still immature business climate lacking in angel investors and venture capital for startups. After a year in operation, the business incubator has already received 100,000 resumes, hired 150 engineers, and spoken with 500 different startups, he said.

The 12 companies Innovation Works is currently funding largely center on developing mobile products. As of June, China had 277 million mobile Internet users, according to the China Internet Network Information Center.

In the next few years, entertainment applications such as media players, e-book readers, and games, will dominate the Chinese mobile market as the price of Android phones drops, Lee said. To attract Chinese users, many of these products will use the "freemium" business model, offering basic services for free and charging for advanced features.

One of products the company is backing, Tapas, is being marketed as mobile operating system specially designed for the younger Chinese user. Although Tapas is based on Android, it replaces many of the apps with local alternatives. Such tweaks include how users will be able to download photos of their contacts via Chinese social networking sites, or display lyrics synchronized with songs. Innovation Works expects Tapas to ship on more than 1 million smartphones by next year.

Innovation Works also introduced Wandoujia or WonderPod, a PC program meant to be an "iTunes-like" companion to help users manage their phone's mobile content. Users can use WonderPod to download videos, music and e-books to their mobile phones over a USB cable, rather than rely on expensive mobile bandwidth, Lee said.

Another product tailored for Chinese users is PhotoWonder, an editing tool designed for young Chinese girls who wish to modify their personal photos, such as by lightening their skin or enlarging their eyes. Innovation Works is also backing a startup called Umeng, which is helping developers analyze the mobile market by providing reports on their users and market conditions.

Innovation Works was funded with $115 million from investors including Foxconn Technology Group, WI Harper and Steven Chen, a co-founder of YouTube.

Lee highlighted how the Internet market differs in China compared to other countries, pointing to how local companies have succeeded in China, whereas many foreign multinational companies have struggled.

"Largely it's because of a lack of empowerment for the local team to move quickly," Lee said.

Having founded his own domestic business incubator, Lee wants to take advantage of a large market still reserved for local Chinese companies.

"What Innovation Works is looking at is a whole list of differences and unique aspects of the Chinese Internet and choosing where are the greatest opportunities for us," Lee said.

Join the Good Gear Guide newsletter!

Error: Please check your email address.

Tags business issuestelecommunicatione-commerceapplicationsPhonessoftwareMobile operating systemsmobileInnovation Worksinvestmentsinternetconsumer electronicssmartphones

Our Back to Business guide highlights the best products for you to boost your productivity at home, on the road, at the office, or in the classroom.

Keep up with the latest tech news, reviews and previews by subscribing to the Good Gear Guide newsletter.

Michael Kan

IDG News Service
Show Comments

Essentials

Lexar® JumpDrive® S57 USB 3.0 flash drive

Learn more >

Microsoft L5V-00027 Sculpt Ergonomic Keyboard Desktop

Learn more >

Mobile

Lexar® JumpDrive® S45 USB 3.0 flash drive 

Learn more >

Exec

Audio-Technica ATH-ANC70 Noise Cancelling Headphones

Learn more >

Lexar® Professional 1800x microSDHC™/microSDXC™ UHS-II cards 

Learn more >

HD Pan/Tilt Wi-Fi Camera with Night Vision NC450

Learn more >

Lexar® JumpDrive® C20c USB Type-C flash drive 

Learn more >

Budget

Back To Business Guide

Click for more ›

Most Popular Reviews

Latest News Articles

Resources

PCW Evaluation Team

Azadeh Williams

HP OfficeJet Pro 8730

A smarter way to print for busy small business owners, combining speedy printing with scanning and copying, making it easier to produce high quality documents and images at a touch of a button.

Andrew Grant

HP OfficeJet Pro 8730

I've had a multifunction printer in the office going on 10 years now. It was a neat bit of kit back in the day -- print, copy, scan, fax -- when printing over WiFi felt a bit like magic. It’s seen better days though and an upgrade’s well overdue. This HP OfficeJet Pro 8730 looks like it ticks all the same boxes: print, copy, scan, and fax. (Really? Does anyone fax anything any more? I guess it's good to know the facility’s there, just in case.) Printing over WiFi is more-or- less standard these days.

Ed Dawson

HP OfficeJet Pro 8730

As a freelance writer who is always on the go, I like my technology to be both efficient and effective so I can do my job well. The HP OfficeJet Pro 8730 Inkjet Printer ticks all the boxes in terms of form factor, performance and user interface.

Michael Hargreaves

Windows 10 for Business / Dell XPS 13

I’d happily recommend this touchscreen laptop and Windows 10 as a great way to get serious work done at a desk or on the road.

Aysha Strobbe

Windows 10 / HP Spectre x360

Ultimately, I think the Windows 10 environment is excellent for me as it caters for so many different uses. The inclusion of the Xbox app is also great for when you need some downtime too!

Mark Escubio

Windows 10 / Lenovo Yoga 910

For me, the Xbox Play Anywhere is a great new feature as it allows you to play your current Xbox games with higher resolutions and better graphics without forking out extra cash for another copy. Although available titles are still scarce, but I’m sure it will grow in time.

Featured Content

Latest Jobs

Don’t have an account? Sign up here

Don't have an account? Sign up now

Forgot password?