Could Chinese Competition Beat Out Facebook?

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Nov. 15 (Bloomberg) -- GGV Capital Hans Tung discusses how China's economic policies impact the tech industry with Jon Erlichman on Bloomberg Television's "Bloomberg West." (Source: Bloomberg)

Good of you to join us.

I want to get your first reaction to these developments today.

Thank you.

I have been working china for the last eight years.

Investing and several companies.

With regards to the one child policy right now in china, over the last 30 years has been the policy.

35 million more chinese man than women.

That is roughly about 10 new york city's of man with no prospect of being married.

When that happens, the online gaming has a good chance of taking golf.

You can -- you cannot go out because you do not have dates.

It has a positive effect on the tech industry in china.

These days, over the last 10 years, the chinese government has been looking at -- depending on where you are.

They are doing that.

Two reasons to do it.

If there are not enough children being born, you are but a very few number of people and an older population.

The situation happened to japan.

The chinese government realized it and want to make changes to accelerate.

Second thing is about women and men in balance.

I want to get to one the major investments you have made in china.

Xiaomi, give me the back story.

I have known the ceo for three or four years.

He spent 17 years to take a company public.

It ended up being amazon china.

It helped to build an internet brand.

He knew mobile was the next big thing.

And he wanted to build something that would allow people to have an awesome experience for a cheaper price.

When we articulated, it is kind of scary.

A lot of stuff to do.

Given the track record, it was a no-brainer.

It was a no-brainer.

You stop the opportunity.

This business has taken off faster than you initially thought.

You ask them himself and you do not think it would grow so fast.

For the record, xiamoi is the first company to head over $1 billion in annual sales and profitable and only 2.5 years.

It took facebook seven years and google six and amazon -- a company that got a lot of attention here because of the hiring of a former google executive.

How did he end up coming to the company was mark a mutual friend i knew him of six years, we got him to be an investor in xiamoi.

We are all good friends of what he is doing and it makes a lot of sense.

We believe in his vision.

Do you think there is going to be a trend here awful more players in silicon valley going to chinese companies?

Over the last 10 years people have seen that china seems to be -- the two markets seem to be similar.

Over the next 10 years, there will be convergence in the market.

It will be well-positioned.

More chinese company's welcome to the u.s. and more u.s. companies will go to china as well.

On that note, people have been talking about facebook trying to buy snap chat.

Could we potentially see a company like snatch it acquired by a chinese company?

There are rumors that the largest social company and china has invested in snap chat.

It has a lower market cap than facebook.

$100 billion -- it has bigger revenue and twice the profit.

It is the only company in the world that can monetize from user paid items.

That continues.

Do you think?

I do not think they need to buy snap chat.

We will watch for it.

We appreciate your insight.

Hans tung joining us.

This text has been automatically generated. It may not be 100% accurate.

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