Summary:

Scale is everything. And China’s digital economy, which differs radically from and often beats the West’s own but about which many Western o…

Scale is everything. And China’s digital economy, which differs radically from and often beats the West’s own but about which many Western observers know little, is a product partly of China’s own numerical heft.

“The fundamental rules of internet do not apply in China,” says CardMunch co-founder and CEO Bowei Gai, who, after selling the company to LinkedIn (NYSE: LNKD) this year, researched China’s internet scene for Silicon Valley types.

Here are Gai’s conclusions in his slideshow, The China Startup Report (via SAI), and three takeaway highlights below…

  • “There are internet users that have never been exposed to the concept of emails, because they have lived their entire internet life on QQ messenger. China challenges your simplest assumption about internet and it’s impossible to understand why without actually being in China.”
  • “In the US, it is common to have a handful of competitors to any good business idea. In China, there could be many times more. It is rumored that there are 3000-5000 Groupon clones and 100+ Chinese Android stores.”
  • “Big US Internet giants are nothing but roadkill in China – Facebook, Yahoo (NSDQ: YHOO), Ebay, Google (NSDQ: GOOG), Twitter, Foursquare, Dropbox are all services that spectacularly failed in China for various reasons. However, for each of the failed US service, there usually is a Chinese company that has figured out a way to make it work.”

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