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Lillian Li

@lillianmli

28 Jul

Lillian: What do you think about the new government tech and education regulations?

Almost everyone I’ve spoken to in China: About time

Chinese stock holders: 🥲, but I brought call options

It raises this unspoken perspective that we don’t really care about what Chinese people on the ground actually care about.

There’s a lot of western media narratives around how this is a play for ‘control’. But who are they taking control away from?

It’s not the Chinese consumer, who didn’t really have control over the prices they were served on platforms, or feel like they could opt their children out of marathon schooling sessions.

The control sat with the private companies.

Read 4 tweets

Lillian Li

@lillianmli

26 Jul

1) Just thinking through the ramifications of Tencent essentially being regulated to relinquish their control over blocking links on their social networks.
Tencent's core competency has been
1) Traffic
2) Money
Which has made them a de facto kingmaker for Chinese startups

2) I spoke about this at length in the battle between Alibaba and Tencent and how much of Chinese internet is now a chase for traffic.
Removing this artificial constraint on the ecosystem will be potentially huge
lillianli.substack.com/p/the-shadow-w…

@DennisHong17

3) Startups may no longer be convinced to take Tencent's investment.
As @DennisHong17 pointed out, Alibaba and Bytedance will be laughing as they finally get access to the walled garden.

Read 4 tweets

Lillian Li

@lillianmli

24 Jul

1) Given the amount of panic I've seen on Twitter over Chinese stocks. I'm once again, asking you to consider some fundamental framings of the rules and objectives of Chinese governance.

It might be interesting. But it is better than being mired in FUD.

$TAL $TCHY $BABA

2) It makes great sense to pay attention to the rules of the game that the players are playing in.

The implicit rules of China are that the government sets goals for the country and invert back to to key objectives that the country should be attaining.

They don't hide this

3) It's literally called the Five Year Plan, it's the blueprint for the next five years and beyond for the Chinese economy.

There is a bit of reading the tea leaves but it's not impenetrable.
Literally. Every. Investor. I know in China pores over this.

lillianli.substack.com/p/the-short-no…

Read 16 tweets

Lillian Li

@lillianmli

3 Jul

Didi’s recent cyber security review seems to be the latest manifestation of an institution masquerading as a tech firm being brought to heel.

Let me explain

Didi has in many ways, become the governing mechanism for a lot of taxis and ride hailing.
However private enterprises optimising for growth have lead to lapses in safety precautions as well as price gauging activities

So the recent reviews are partly due to this, but there’s also additional concerns as Didi has unparalleled view into road usage into China.

Read 7 tweets

Lillian Li

@lillianmli

1 Jul

1) Expanding on the newsletter as a SaaS product with my 3 learnings.

I have been a SaaS investor for most of my investment career. While writing a paid newsletter might seem like a little out of left field, to me, it is the MVP way in which I've been creating a SaaS product.

2) My focus has moved from product creation to marketing, to sales conversion and to churn management in the last 10 months.
I think this view of the newsletter as knowledge-as-a-service will gain more prevalent traction in the future. (It is a known concept in China - 知识付费)

3) Learning 1: Twitter as the top of the funnel is a great place to start. There's a match in conversion. People are used to reading here, it's not a jump to convince them to read more in longform.

But as that yield decrease (as it always does with marketing channels)..

Read 12 tweets

Lillian Li

@lillianmli

24 Jun

1)The second to last of my convo with Mike from WCM:

“A big trend for Chinese software over the next 10-20 years will be internationalization. We are the first innings of this today. For some tech companies, I suspect the future profit pool globally will be bigger than China...

2) We've seen a couple of big success stories: Zoom and Tiktok have emerged just in the last couple of years. But I think that's the tip of the iceberg.

There are two kinds of plays here.

3) The first is consumer internet/gaming, China is on the bleeding edge. It's almost inevitable that Chinese companies will seek to export business models to the rest of the world.

Examples: Bigo, Yalla, Tiktok, Crossfire (sort of), etc.

Read 13 tweets

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