If a person comes for the profit goes for another profit, a person bows for a power searches for another powerful men. Only the person comes for the mind lasts forever." - from “The Rise of the Great Nations” by SangRae Cho.
Smilegate group(CEO HyeokBin Kwon) is famous for a FPS game called ‘Cross Fire.’ Cross Fire which has 500million global users, 6million users for concurrent user, successfully localized the game in Chinese market. In 2007, due to the heavy competition against ‘Sudden Attack’ and ‘Special Force’ in Korean game industry, Cross Fire decided to cooperate with Tencent, a new Chinese publisher, and seized the chance to revive. Tencent knew Chinese market situation very well, so Cross Fire could reborn following the strict localization strategy. China had low computer specifications and it lacked of infra, but Cross Fire could be played with ease, so many Chinese users found it highly interesting. With the the circumstances that the online game industry was soaring steadily and the combination with the user data from the Tencent’s QQ messenger, Cross Fire succeeded to exceed one million users for concurrent user in 2009.
Cross fire is the succession case of advancing to China with three success points which are the ‘strict localization,’ ‘market timing’ and the ‘product propriety.’ Can they put their success DNA into other Korean startups which want to enter Chinese market and make them as another succession cases as well? A youth startup assistance incubation center Orange Farm(SangBong Suh)’s ‘Orange Farm Beijing program’ run by Smilegate Foundation(CED HyeokBin Kwon) is noteworthy in this case. Orange Farm has concluded an agreement with ‘Innoz’ incubation center’ in Zhongguancun High-tech Zone, Beijing, China to start supporting Korea’s excellent startups.
Here we had a chance to interview SangBong Suh, the head of the youth startup assistance incubation center Orange Farm, to be informed about the ‘Orange Farm Beijing Program.’
- Could you please introduce the ‘Orange Farm Beijing Program?’
Orange Farm Beijing Program is a support program for Korea’s excellent venture/startup companies which want to enter the Chinese market with Smilegate’s network and knowhow of market in China. Innoz, the Chinese partner of this program is a incubating specialized company constructed in Zhongguancun High-tech Zone Z-part in October last year which is a joint venture between ‘Zhongguancun development team(中關村發展集團),’ the Chinese ministry of science & technology’s state-run firm, and ‘iSoftSone,’ the IT firm. Two companies will help Korea’s excellent startups to establish corporations in China, settle down well in the early stage by running a cooperation program building a network with Chinese local networks(Startups, VC, angel investment, government etc.) Not only that, in order to spread the communication between China and Korea, they are going to open a demo day and an exchange meeting regularly, and even Chinese excellent startups can move into the Korea Orange Farm with the same standard.
- What is the standard of Korea startup selection?
Orange Farm Beijing Program haven’t set the specific standards or categories for the startup item. This is for the startups which have finished developing the product or service and running a company in Korea, but there must be staffs who can speak Chinese like native speakers. Also if the company has a specific reasons or milestones rather than a vague vision for the Chinese market is an important standard of selection. For last, the company should be within 5 years since the establishment.
- Korea startups are curious about Zhongguancun High-tech Zone where the Chinese corporate will be established.
Li Keqiang, a Chinese prime minister, is encouraging youth to start the business saying, ‘Startups will bring up the innovation for all people(大众创业，万众创新).’ Zhongguancun in Beijing is like a cradle for this because almost one third of Chinese overall startup investment fund, supporting policy and outstanding work force are all invested in this place. Zhongguancun has lots of outstanding work force from prominent universities and the national research and development institutes, and government is supporting startups and overseas expansion with funds. Furthermore, there is an innoway(innovation-way) for encouraging youth’s technique startup, and more than 20 startup supporting service platforms which are similar to the Silicon Vally in in the US for incubating, investing, media etc.
- What will Korea startups be supported by the ‘Orange Farm Beijing Program?’
Orange Farm Beijing Program is an incubating business. When the companies move into Chinese partner company Innoz, the program will support the office rental fee as the actual expense level. Also it’ll host the demo day and the networking day for meeting Chinese related companies(Startup, VC, angel investment). Furthermore, there will be the education teaching how to build Chinese corporate, and how to apply for the patent. It has plans to conduct various programs related to Chinese government fund and investment for Zhongguancun district.
- Please tell us the procedure for the ‘Orange Farm Beijing Program.’
The recruitment has been started since June 5th. Firstly we receive the documents online, and then there’s the evaluation and the interview. It’ll almost take one to two weeks until the last step, the final PT. Once the companies are chosen, they’ll be educated for 3~4 weeks in Korea, and they can move into Chinese Innoz from the early July.
Apart from these, SangBong Suh, the Orange Farm’s head said, “The Chinese market needs not only the logic of capitalism but also the long-term vision of the history and the relationship.” and highlighted the importance of the networking and the strategy for the localization.
About the huge success case of in China, the production company NEW has chosen IQIYI(爱奇艺) for the video platform to simulcast in both Korea and China. This was possible because of the long partnership between IQIYI(爱奇艺) and a media group HuaC Media(华策影视) which conducted the strategic investment to the production company NEW. HuaCe Media(a contents production and distribution company) and IQIYI(a video platform company) established ‘HuaCe IQIYI media company’ in Aug, 2014 to grow as a total entertainment media group. Through this, both companies developed various internet contents and IP, and conducted an experiment to expend those to the e-commerce field. would be the success case of this strategy. Just like the fact that ‘Cross Fire’ had Tencent, an excellent publisher in 2009 when Cross Fire tried to get into Chinese market, was also successful in 2016 because they were with HuaCe Media and IQIYI, which were trying to grow as a total entertainment companies.