How do you choose a reliable online start-up company?

February 18, 2016 2 mins read
How do you choose a reliable online start-up company?

Following the prosperous development of the Internet in recent years, an increasing number of start-up companies have appeared in quick succession.

Not only have many Chinese Internet professionals become involved in various start-up companies—more and more Silicon Valley professionals and even traditional IT staff are closely following the development of Internet start-ups, and are considering them with a more open attitude.

How, then, should we go about choosing a reliable Internet start-up company? I personally believe that a good climate, terrain, network and funds are all equally indispensable.

By "climate", I am referring to the company's point of departure, that is, whether their services and products are capable of responding to their chosen demographic's basic demands or higher needs. The "climate" of a company refers to the way in which that it ascertains, based on the state of the economy, the more complex needs of its users (i.e. Maslow's hierarchy of needs), as well as the market and demographic for its products.

"Terrain" refers to the customs, consumer habits and national policies of different countries.

In my opinion, the "network" is the most important aspect of choosing a start-up. The background of the team's founding members, how well established they are, the degree of complicity between them, their experience in the industry, their leadership skills and their ability to determine company strategies are all important factors to take into consideration.

If a good "climate" is what ensures the scope of the venture, a good "terrain" is what ensures that the venture goes smoothly, and a "network" is what ensures that the venture goes a long way, then one could say that funds are an important stimulant that allows the venture to take off more quickly. One needs to take into consideration the background of the investors, the type and amount of the investment, as well as its potential for subsequent growth.

The above is just a general overview. In order to make further judgements, one needs to become familiar with the whole market, as well as analyzing different aspects such as: domestic and international development trends; the activity of capital investors (particularly those with successful track records), as well as insider connections and changes in national policy.

Remember to do your homework on a start-up before accepting an offer.  

Marlon Mai's picture
Managing Director, Greater China
mmai@morganmckinley.com