Earlier this week, the 3rd annual China-US Private Investment Summit was held in Austin. Two of my Powershift Group colleagues had significant roles in the event. Joe Canterbury served on the Austin host committee. And, Steve Papermaster served as a speaker on one of the program’s featured panels, discussing the topic “Key Sectors for Collaboration.”
Not surprisingly, Summit producer Jay Riskind confirmed that this year had broader participation than ever before, with three hotel blocks of rooms around Austin completely filled with incoming Summit guests.
The Summit agenda included a great opening day of programming at the LBJ Presidential Library, a reception and dinner with President Clinton, and closing day of deal-pitching at the Circuit of the Americas race track.
Along the way, there were dozens of pearls of wisdom to be gathered, from the speakers on the formal program, to the informal networking in the halls and receptions. One of my favorite pearls comes from a story recounted by Ping Gao, a panel speaker. Here are the highlights of his story:
Ping, a Chinese native working in the US, was hosting a Chinese businessman and his family who wanted to invest here. Ping showed the man some property that he thought would be a good investment for $1 million and the businessman agreed.
The next day, part as tour guide/part in celebration, Ping arranged to take the man and his family in a small plane to tour the countryside, flying over other properties to get an idea of the range of future options, should the man be interested.
During the flight, there was trouble with the plane and it crash-landed. After attending to the family after a trip to the local Emergency Room, Ping invited them to stay with him for a period of several weeks so that they could convalesce.
After convalescing and their departure, Ping thought that might be the last that he ever heard from the investor. But, just a couple of months later, he received a request by the investor to return. When he did, the man purchased a $40 million property that Ping had showed him during their ill-fated plane flight.
As an on-the-ground participant, if I had to sum up the morale of this story, as well as the overall theme of the Summit in a single word, it would be “relationship.”
Over and over again, the importance of relationship-building – and its natural byproduct, trust – was emphasized by speaker remarks, side-conversations, real-life stories like Ping’s, and ultimately in the very purpose of the Summit itself.
The Importance of East-West Relationships
By now, one would have to be intentionally ignoring the news to be surprised by the fact that China has taken the stage as the world’s other great economic super-power, joining the US.
It’s an extraordinary position, especially when you consider – as the first day’s Summit speaker, Ambassador Clark Randt, Jr. observed – that barely over 30 years ago, the amount of Chinese investment in the US was $2.5 billion. In 2014, it was more than $500 billion – a 200 times increase in a single generation’s time.
Because of the enormous economic engine that China has built, it’s essential that China and US leaders in business, political, and academic work on a deliberate and constant basis to build relationships on multiple levels.
After all, our goals are the same: Peace and prosperity. Likewise, the threats to our nations are the same: Terrorism; pandemic disease; the long-term availability of food and water; energy security; and, climate change.
Moving from the geo-political reasons for relationship-building between China and the US, there are also very fundamental business reasons for doing so. In short, relationships are the gateway to success or failure with Chinese business and investing.
In China, the expectation is to get acquainted first, then move on to deal-making second. In the US, while relationships are important, it’s a much more acceptable practice to proceed straight to deal-making, with deeper business relationships and friendships to come later.
How Do You Build Relationships
Stressing the importance of relationship-building is one thing. Doing it is another, because it takes time, money, and intent that can seem daunting at first. At Powershift Group, we’ve put into practice specific programs that have paid off in relationship-building that has powered our work in China for years.
First, doing your homework and learning about the work and lifestyle’s of China are crucial. In addition to traveling and experiencing the culture firsthand, there are many sources online that provide deep insights. Here’s a starter reading list of my recommended China tech and business blogs.
Second, it’s essential to identify and cultivate an influential business partner. For Powershift Group, we’re honored to call Neusoft Corporation our partner. In addition to sharing many goals and values with Neusoft’s leadership, the relationship has been a centerpiece of the “China first” strategy we have been implementing since 2011 with our mobile software company, Appconomy.
Third and finally, as my colleague Joe Canterbury observed in the Summit’s 2015 Perspectives Report, “Student exchanges – high school, university, and graduate level – are key.” This Spring and Summer, we are bringing our third cohort of University Interns and Graduate Fellows into our Austin and Shanghai offices for the Powershift Exchange program.
In closing, regardless of your company’s financial means or focus, know that there is path for China-US relationship-building available and affordable for you, if you want it. And, perhaps most important, remember Ping Gao’s story and take heart. Because no matter how tentative or shaky your first forays may be, calling on his example: it’s not what you do at first - that might lead up to a trip to the ER - that matters; it’s what you do afterwards that matters most.