The founder and CEO of Cocoon Networks, John Zai, says that the UK’s entrepreneurial spirit and China’s huge buying power is a perfect match.
Here he talks to Business Leader about why UK and China business relations have only just started.
Please tell me more about Cocoon Networks and the aim of the company.
Cocoon Networks has been in the market for four years. In the beginning we were a very tiny Chinese venture capital firm. The valuation of start-up technology companies in the UK and Europe are quite low compared with America.
A lot of Chinese investors have been focused on the US and Israeli markets; and not much attention has been paid to the UK or European market. But Cocoon wants to educate investors in the UK and China to the potential of both countries working closer together.
Why do you believe the relationship between China and the UK/Europe is so important?
China is the world’s second largest economy and has a huge consumer market that will only grow in the next five to ten years.
This presents UK businesses with a major opportunity. The UK and China is a perfect match because every country in Europe has a small market, especially compared to China so now is time to explore its potential. The UK in particular has great technology companies while China needs to develop its technology, so UK companies have a new market here to attack. This is where we come in – as we can link both sets of entrepreneurs.
What will the impact of Brexit have on your business plan?
I don’t think it will impact my company and its plan. I actually see this as an opportunity for UK and China. Why? Because if the UK was in the European Union then I don’t think the appetite to do business would be there to the same extent.
The UK will need a strong market, it will need to connect with new markets and because of Brexit I think restrictions will be removed and it will be better for China and UK collaboration.
What advice would you give to UK startups looking to navigate the Chinese market?
For UK businesses looking to establish a presence in China, knowing the cultural differences is essential. Obstacles such as the ‘Great Firewall of China’, which blocks many Western applications such as Youtube and Instagram and can block emails as well, must be considered when designing a marketing strategy.
What’s your vision for Cocoon Networks?
In the future, I see Cocoon as more of an investment bank with consultancy work aiding companies. Later on this year, we are bringing London Technology Week to China, for the first time ever and this will open so many doors for British entrepreneurs to the Chinese market.