14 DAY TRIAL // Google's recently departed head of operations in China has uncovered some details on his future plans. Kai-Fu Lee has confirmed that he is, indeed, leaving the company and has also said that he will be starting a new company called Innovation Works, an incubator of sorts adapted to the market's particular needs. The incubator has secured $115 million in funding from WI Harper Group, a venture capital firm with a focus on the China market, along with several individual investors.
Innovation Works will also function as a venture investment fund and development lab, an odd mixture, but one catering to the emerging, startup ecosystem in China. The fund will hire 100 to 150 young engineers and provide them with all the necessities of creating new products for the Chinese market. The plan is to have 50 to 75 of them moving to launch new companies with funding from Innovation Works, while also hiring new people to make up for the loss.
Incubators have had a spotty history in the US, and even the successful ones usually just end up serving one company that takes off and then closes down. Lee believes that the market in China is much more favorable and suited for this kind of ventures at the moment, as there are a lot of companies starting up and also a lot of venture capital money, but there is a need for angel investors and early-stage funding. He also says that the country is at a crucial point in the web and tech sector, but also for entrepreneurship on the whole, with individuals beginning to be more willing to make riskier moves.
The new fund is still in the early stages, with no clear deadlines set, but Lee hopes to have it grow rapidly, possibly expanding out of Beijing, where it will be headquartered. It also enjoys the support of several experienced investors. Lee himself has worked for Microsoft and Google in China and the fund's investors include YouTube Founder Steve Chen, Terry Gou, chairman of Foxconn, Liu Chuanzhi, chairman of Legend Group, and Yu Minhong, chairman of New Oriental.