Shenzhen, a city in Mainland China and close to Hong Kong evolved within 30 years from a smaller fisher town to one of the biggest factory cities worldwide with headquarters of companies such as Lenovo and Huawei. In 1980 it became China’s first Special Economic Zone (SEZ).
Even though Shenzhen represents a smaller startup scene compared to other giant metropolises and first-tier cities like Beijing or Shanghai, it had in 2014 according to the blog Seedstarsworld 400 VC companies, which managed a third of China’s total social funding (about 8 billion Euro) and those companies invested in 2,600 projects, among which 100 are listed in domestic and overseas stock exchange. The Guardian is calling Shenzhen in an article in 2014 “China’s Silicon Valley” especially for hardware makers and according to the US magazine Inc. it is one of the top five startup hubs in 2015.
Due to the vicinity to the factories and stores with large technical supply, Shenzhen became a center especially for hardware based startups, but ecommerce and gaming companies represent large sectors as well. Hax, formerly Haxlr8r, for example is a well-known Chinese accelerator, or as stated on their website: the “world’s first and largest hardware accelerator” and according to Techchrunch “[…] currently [March 2015] the most active investor in crowdfunded hardware projects, with 26 investments recorded to date.”. As an example for an incubator Innovalley could be named, with its main focus on software startups.
In 2014 a big Shenzhen-Hong Kong startup accelerating cooperation-project was launched, initiated by several Chinese government related organizations (SZQH, SZYF, HKFYG): the Qianhai Shenzhen-Hong Kong Youth Innovation and Entrepreneur Hub. This large innovation hub (58,000 m2) provides a diverse range of facilities, such as offices, an exhibition center, an academy, an innovation center and a residential building. Young entrepreneurs from mainland China, Hong Kong and abroad are invited to use these facilities to start their businesses and create a vibrant startup community, tax reductions and low rent included.
But there are also hurdles for foreign entrepreneurs such as the language barrier – The Shenzhen startup scene communicates mainly in Chinese. Some events are organized by Startup Grind Shenzhen and there are also several Startup Cafés, which in comparison to co-working places just function as a café with working spaces, without any additional fees, e.g. 3W Coffee or Beta Cafe.