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August 29, 2015

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China’s new generation of entrepreneurs seek wealth through health

Source: Xinhua | August 29, 2015, Saturday | Print Edition

CHINA’S new generation of entrepreneurs are using their business acumen to bring some basic, but essential, industries up to date.

Li Feng, a former partner at IDG Capital Partners, believes the best entrepreneurs will play a bigger role in the next decade in tackling social problems.

“There is a clear spiritual component in the mindset of these young entrepreneurs, especially those born in the 1980s and 1990s. This was missing in the previous generation who cashed in on the real estate market,” said Li.

Elderly happiness

More than 15 percent of Chinese people are over 60 years old. By 2050, there could be as many as 400 million elderly people in China, accounting for one third of the population.

Wang Zhen, 31, and his younger brother Wang Lei, 29, see a silver-haired lining to these statistics: a huge market for care and other services for the aging population. Their medical equipment business, VACN Investment Group was established in 2005, and after almost 10 years of success, the brothers feel ready to scale up their business and move online.

In July 2014, they launched the No. 9 Happiness online shop, China’s first online store catering specifically for the elderly.

ß–They made 10 million yuan (US$1.6 million) on their first day — double the amount made by JD.com, one of China’s largest online retailers, in its first year.

VACN has 4,000 distribution outlets in more than 100 cities. Some offer after-sales services for the online business while others support community nursing and care workers.

In July last year, the brothers plowed the profits from the online operation into the No. 9 Happiness Entertainment Park. The parks now have 1.7 million members all across China.

These “Disneylands for the elderly” are daycare centers that organize physical therapy, dance lessons, singing groups and other activities like painting, chess and English lessons for paying members.

“In the next three years, we hope to provide free lunches for all our members,” said Wang Zhen, who dropped out of school in the fourth grade.

No. 9 Happiness is a technology-driven institution, according to Wang Zhen. The brothers recruited Li Daxue, former head of R&D at JD.com, earlier this year as chief technology officer. He has been tasked with big data architecture.

The company is active in the development of intelligent products and has already developed a smartphone specifically for the elderly. Products such as intelligent beds and pillows are also in the pipeline.

“The data that we collect through our e-mall and entertainment parks, helps us build a better online shopping platform,” said Wang Zhen. “The profits finance the entertainment parks and in the future we hope to provide services and care to our members in their own homes.”

Zhang Yuling, a retiree from Shanghai, was treated for scoliosis and three broken ribs at one of the parks. “I am like a different person. I used to be very depressed, now I can help my daughter-in-law with the cooking,” she said.

Following their success, Wang Lei was chosen by Forbes this year as one of their top entrepreneurs under 30. He has big dreams for the future of their company, and not just in China. He wants to spread the No. 9 Happiness message across the globe.

More than just money

Wang Lei and Wang Zhen are just two of millions of Chinese turning their bright ideas into brilliant business. More than 10,000 new companies are registered every day in China, according to the State Administration for Industry & Commerce.

Yuan Zhizhong, a partner at SinoFund Capital Management and a board member of the China Association of Social Value Investment, believes that more social entrepreneurs will emerge as society becomes more affluent.

Two groups of people have the potential to do more for society, he said. The first group are the vanguard of the digital economy, Alibaba’s Jack Ma and Tencent’s Pony Ma, for example. The second group include those who graduated from college after late 1970s. Many were educated overseas and are driven by a desire to make China a better country, Yuan explained.

“Our culture is built on Confucian values like caring for others and harmony between man and nature. When the nation was struggling with poverty, these values were forgotten,” he said. “In a better-off society, people are driven by social responsibility rather than just money.”

The new generation of entrepreneurs have realized that checkbook philanthropy is just not enough. Instead, they are driven to build a better nation, for young and old alike, all along the industrial chain, Yuan said.

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