Phones and drones - China's risk-takers who rule the world

Fromacompanyfoundedbyacollegestudentin2006toagloballeaderintheciviliandroneindustry,thestoryofDa-JiangInnovations(DJI)illustratesjustwhatatruecommitmenttoinnovationcando."Thekeytoinnovationisnot1-to-n,it'sthe0-to-1partthatmakesallthedifference,"saidWangTao,DJI'sfounder.

"First-moveradvantagesaredifficulttolosewhenyouareinthemarketwithgroundbreakingtechnology."hesaid.In2010,DJIsaleswerearespectable3millionyuan(460,000U.S.dollars).In2014,thatnumberjumpedtonearly3billionyuan.DJIisontracktomakeabilliondollarsin2015.TheShenzhencompanysellsnearly70percentoftheworld'sciviliandrones,and80percentofitsrevenueisgeneratedoutsideChina.DJI'ssuccessstoryisnotanisolatedcase.Xiaomi,amobilephonefirmfoundedin2010becamethethird-biggestsellerofmobilephonesworldwidein2014,thesameyearthatXiaomicame35thonalistoftheworld'smostinnovativecompaniescompiledbyTheBostonConsultingGroup.Asidefromitslowprice,Xiaomi'spopularitycanbeexplainedbyitsinnovativeMIUIOSwhichwasmoresmooththantheoriginalAndroidOS.AsXiaomitookthephonemarketbystorm,itcontinuallylookedtothefutureandnowoffersadiverserangeofInternetofThingsproductsthatinteractwithitsmobilesincludinganairpurifier,bathroomscales,bloodpressuremonitors,lightbulbs,TVsandawebcam.ThesuccessofXiaomiandDJIboilsdowntocontinuallyreinventingthemselves.

ThesearchfornewtechnologyandnewideashasbecomeapalpabletideinChinaastheeraofcheaplaborandfastexportsiswashedaway.InnovationwasputinfirstplaceinChina'splanforthenextfiveyears,aplanwiththegrandgoalofdoubling2010

GDP

andpercapitaincomeofbothurbanandruralresidents.Thegovernmentsetaside40billionyuanlastyeartonurturestartups.Inthefirstthreequartersof2015,10,000newcompanieswereregisteredeachday.

AsChinabecomesprosperousandmorefamilies,eventhosefromruralbackwaters,haveaccesstohighereducation,peoplearebecomingmoreconfidentrisk-takers.Stablegovernmentjobshavegraduallylosttheirshinewiththechanceofmakinganewproductandreapingrichrewardswithinthereachofmany.

In2014,venturecapitalistspumpedarecord100billionyuanintostartups.Thefigurefor2011was30billionyuan,butthereisstillampleroomforimprovement.

Despitebeingtheworld'ssecondbiggestgrossR&DspenderbehindtheUnitedStates,Chinastilllagsbehinddevelopedcountrieswhichnormallyspend3to4percentoftheirGDPonR&D.Lastyear,expenditureinresearchanddevelopmentreached1.3trillionyuan,up9.9percentfrom2014,andmorethan2percentofGDP,onlythesecondstraightyearabovethe2-percentmark.