What makes the Chinese tech ecosystem
so different from Western ones?
With the sudden rise of the AI app DeepSeek, China has once again stunned the Western world with its efficacy and creativity in the development and roll-out of digital products.
While Chinese tech companies initially copied Western models, creating a parallel digital ecosystem that was supported by dedicated Government initiatives and massive amounts of venture capital funding, it is safe to say that the tables are turning.
The fast rise and expansion of apps like DeepSeek or TikTok is made possible by a tech ecosystem that differs greatly from Western ones, with super apps, a near obsolescence of cash, live-stream shopping and ultra-fast delivery. But companies also operate in an environment where massive amounts of data are available and regulations allow for more flexible developments in AI.
We spoke with Emily from China-Global Innovation Launchpad XNode, as well as Minzhi, founder and ESCP ambassador in China, to explore the uniqueness of the Chinese tech ecosystem and how the Executive Master in Digital Innovation and Entrepreneurial Leadership nurtures its various aspects.
ESCP: Where do you see the greatest strength of the Chinese tech ecosystem?
Emily / Minzhi: The greatest strength of the Chinese tech ecosystem lies in its robust integration of several critical factors that collectively fuel innovation and scalability. First, China boasts a strong infrastructure and unparalleled hands on experience in supply chain and manufacturing. This enables rapid prototyping, cost-efficient production, and the ability to scale hardware and consumer electronics at speed.
Second, the vast volume of data generated by its large and digitally active population provides a unique advantage. With hundreds of millions of users across diverse regions, Chinese tech companies can train AI models, test new applications, and optimize products in real world conditions more effectively than in many other markets.
Lastly, the Chinese government plays a significant role by offering targeted support to strategic industries, including artificial intelligence, semiconductors, and green energy. This backing often comes in the form of funding, favorable policies, and long-term planning, helping accelerate growth in key technology sectors.
ESCP: What makes Chinese consumers special? What are their expectations?
Emily / Minzhi: There is a high willingness among users to try new apps, solutions, and business models. At the same time, there is relatively low sensitivity to data sharing within certain limits. Convenience and affordable pricing play a crucial role in driving adoption, as seen with platforms like Pinduoduo (US-listed) and Mixue (HK-listed).
Additionally, there is a strong passion for food and unique experiences, exemplified by brands like Popmart, where customers buy not just products but memorable experiences. Users have also become accustomed to highly exceptional UX/UI and detailed, granular level of service provided by Chinese apps, including food delivery, Taobao, RED, and supermarkets.
ESCP: What role does the 海归 play in innovation nowadays?
Emily / Minzhi: The 海归 (returnees with overseas education or work experience) play a nuanced role in China's innovation landscape, contributing both opportunities and facing certain challenges.
From a top-down perspective, they are highly sought after by various levels of government, which often implement initiatives to attract them offering incentives such as tax breaks, talent subsidies, and support for setting up companies within specific districts. These policies reflect a broader strategy to inject global perspectives and advanced skills into the domestic innovation ecosystem.
From the bottom-up, 海归 bring valuable global execution capabilities and cross-border experience, positioning them well for ventures that require international outlooks or connections.
However, they can sometimes struggle to fully integrate with the broader, more rural Chinese market, where the demand for globally-oriented products or services may be limited. Despite these cultural and market adaptation challenges, 海归 with deep expertise in hardcore technologies, such as AI or semiconductors, are generally well-received and often find it easier to scale globally from within China’s supportive tech environment.
ESCP: In the past, Chinese founders often got inspired by the US, Silicon Valley, especially. Has this changed at all? Is there a stronger focus on neighbouring Asian countries nowadays?
Emily / Minzhi:The U.S. continues to be a mature market for venture capital, startups, and technological innovation, setting benchmarks in many areas of the global tech ecosystem. At the same time, domestic trends in China are shifting toward greater confidence in homegrown technologies, as seen in the rise of companies like DeepSeek.
Cross-border collaboration remains active, particularly in regions like Southeast Asia, where increased engagement is often facilitated by bilateral government initiatives, especially in light of current geopolitical dynamics.
From the perspective of startups and based on XNode’s experience, Chinese founders generally view Southeast Asia more as a potential market than a source of cutting-edge technology.
However, when there are clear revenue opportunities or strategic value in technological collaboration, they are certainly open to pursuing those partnerships.
ESCP: What are super apps like WeChat and Alipay?
Emily / Minzhi: Mini programs have become an integral part of daily life in China for at least the past 5 to 6 years, yet they remain somewhat of a black box for people outside the country. These lightweight apps run within larger platforms, offering seamless and convenient experiences without the need to download separate applications.
For example, AMAP (also known as Gao De Di Tu or AutoNavi), which is a subsidiary of Alibaba, features its own mini program ecosystem.
This allows users to access services like calling from 15 different local “Uber”-style ride-hailing brands directly within the map app, eliminating the need to exit or switch between individual apps.
Other prominent platforms leveraging mini programs include Xiaohongshu (Red), which boasts over 300 million daily active users and integrates e-commerce within its social media environment; Meituan, which combines functionalities similar to Yelp, Uber, and an e-shop; Douyin, the Chinese version of TikTok; and Pinduoduo, a major e-commerce player.
Together, these mini programs have transformed how consumers interact with services and products, creating a highly interconnected digital ecosystem unique to China.
ESCP: Where do you see the Chinese tech ecosystem going? Is there anything you are excited about right now?
Emily / Minzhi: The “go global” trend among Chinese companies is still in its early stages. While Chinese founders are highly skilled and competitive within the domestic market, many lack deep know-how about operating effectively in the global arena.
ByteDance stands out as one of the few Chinese companies successfully expanding internationally in a truly global way.
Other notable examples include Transsion, Anker, and Oppo, which have also made strides beyond China’s borders.
Looking ahead, the evolution of more B2B industries over the next five years is particularly exciting, as these sectors hold significant potential for growth and transformation. Additionally, the integration of AI across industries (“AI+”) is still nascent, and each sector could experience disruptive innovation or accelerated growth through AI adoption.
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