This article comes from WeChat public account “Silicon Star” (ID: guixingren123), author CJ, editor Vicky Xiao , Love Fan is authorized to publish.
Harrison Rose has been in the US technology industry for more than 40 years. Soon after he founded the commercial robot hardware company TRC in Silicon Valley, the robot was written on the foreign-invested list. This falling trade iron curtain failed to block his plan to go to China, build a branch, and recruit software engineers.
As for his destination, let’s guess: Is it close to the factory in Shenzhen? Or is Beijing where investors gather?
Rose tells Silicon Stars: The best place for me should be Xi’an, or Chengdu.
Why did Silicon Valley startups select programmers in western China to bring a new combination of cool-skinned meatballs and code to the code?
A background that cannot be ignored is that the team of Chinese software engineers is growing rapidly outside the first-tier technology cities such as Beijing and Shenzhen. Among them are traditional college graduates and software development engineers who have transformed from assembly line workers. Sun Ling, a most inspirational female engineer, has walked from the Shenzhen electronics factory to Google’s New York office.
The textile female worker Yang who can debut from the female group has only one, but the software programming technology that can be copied and can be “successful” has undoubtedly opened a broader door for more people seeking new opportunities in China.
One-handed demand, one-handed supply. If the era of China’s “export manufacturing” is dying, is the era of “exporting brain power” coming?
The first person to discover business opportunities – “Shenyang” programmer Bob
An American programmer has long discovered the value of Chinese programmers.
As early as 2013, Verizon, the major US telecommunications company, discovered that the system had long-term visit records from China and was suspected of being invaded by Chinese hackers. The survey found that an employee whose address was shown as Shenyang, China, “Bob” worked diligently to write code through VPN, staying up late in the US time zone “to nine to five”, and also received praise from the clean and best engineers.
A further investigation revealed that the real Bob is in his forties and is an old employee of the US office. His daily work is to watch the cute cat video on YouTube, go shopping on eBay, brush a reddit, Facebook, LinkedIn, and get off work at 5 o’clock.
The truth is revealed: Bob’s annual salary in the United States is six figures.With one-fifth of his salary, he outsourced his work to a software outsourcing company in Shenyang. He delivered the RSA Dynamic Token to China, allowing the outsourcer to access the company’s system via VPN on weekdays to help him with his work.
Although Bob did not escape the dismissal of the dismissal, he was actually an employee with a vision of a capitalist and a deep international arbitrage.
The entrepreneur mentioned by Rose mentioned in the west of China is also the cost: if it is Shenzhen, Beijing, the cost is 25% higher.
Rose uses Silicon Valley buzzwords to comment on current events, such as “Garbage in garbage out” (error input, error output). “Pick the best of both worlds” is a summary of his plan for China.
IT outsourcing for large US companies and startups has a long history. India has benefited from language convenience and earlier investment in the information technology industry. The IT outsourcing industry has created a value of 100 billion US dollars and is one of the pillar industries of the country.
The reasons for cross-border outsourcing are written in the advertising slogan: you can get high-quality foreign employees and save 70% of the cost.
Interestingly, once American companies outsourced their goals to countries where English is the main language of India, Chinese engineers are now entering the field of vision.
One of the software architects in the Asia-Pacific region of Pfizer Group, Troy Hunt, has completed hundreds of projects with dozens of suppliers in India, China and the Philippines. He compared the salary data of the three places in 2015 and made a huge difference with the British and American countries.
India and the Philippines are both native English speakers. But among the three countries, he still most wants to keep working with the Chinese team becauseThe engineers of the country are of high quality, flexible in handling, and few additional conditions. But it must be a long-term cooperation, because Chinese programmers are not very proficient in English, and the task of changing Chinese programmer grammar is still too large.
He believes: “If you are passionate about technology and don’t care about China’s dynamics, then you may miss the world’s most important technological innovations and sources of growth in the coming decades.”
Capital always flies to the lowest cost place. Students who have taken macroeconomics 101 have been educated: countries produce their own products with comparative advantages, global division of labor, and trade swaps. Both countries can consume more products at a lower price, so that everyone can benefit from it.
From the manufacturing plants in the Pearl River Delta, to the foreign enterprise software parks that have arisen in the cities of mainland China, to the Silicon Valley startups that are flying to the west to find software engineers.
From the weaver to the assembly line, the global division of labor has come to the field of “code”.
“Oriental Secret Weapons” of Silicon Valley Enterprises
It’s not just outsourcing companies that have seen this opportunity. In recent years, some “secret weapons” that are surprisingly successful in the US market are the engineers and R&D teams in China.
The Chinese team has played a pivotal role from the profit-marketing Zoom to the emerging podcast platform Castbox. Tesla is also forming a research and development team in China.
Zoom is a rare profitable listed unicorn in Silicon Valley this year, disclosed in the prospectus:
Our product development team is primarily located in China. China’s labor costs are lower than in other regions.
Zoom’s prospectus shows that it has more than 500 employees in several R&D centers in China, accounting for about 30% of its total workforce. From Zoom’s school recruitment information, its research and development positions are distributed in Hangzhou, Suzhou and Hefei.
According to the recruitment information, Zoom’s highest monthly salary in Suzhou and Hefei engineers is no more than 30,000 yuan, and some positions are paid 14%. According to Glassdoor, Zoom Silicon Valley engineers earn at least $110,000 a year.
Chinese engineers discussed Zoom’s working environment on the industry website. “Hefei is a pure R&D team.” “Zoom is one of the best in Hefei. It is mainly because there is no forced overtime work.”
In the last fiscal year, Zoom’s R&D spending was $33 million, accounting for only 10% of total revenue. Zoom said that if they had to transfer their product development team from China to another jurisdiction, they might pay higher costs, which would have a negative impact on profit margins.