This Alibaba, Airbnb investor tells Indian startups to forget China and go after South East Asia

Hans Tung, Managing Partner, GGV
  • In an interview with Business Insider, Hans Tung, Managing Partner, GGV Capital, talks about why Indian startups shouldn’t focus too much on conquering the Chinese market.
  • Tung, has over 14 unicorns in his portfolio, including the likes of Airbnb, Slack, Bytedance, Xiaomi amongst others.
  • Tung invested personally in Flipkart and Snapdeal.
When Hans Tung, Managing Partner, GGV Capital, was in India last month, it was not surprising to see the Chinese investor mobbed by Indian entrepreneurs waiting to have a few words with him.

And why not? Tung, who was an early investor of Alibaba, was here looking for his next big investment.

“In India, we are looking at opportunities in consumer internet space. Having been a small personal investor in Snapdeal and Flipkart, I have some experience in tracking the rising consumer internet companies. With Unified Payments Interface (UPI), there’s so much growth possible in the consumer internet space here,” Tung told Business Insider.


GGV Capital, the fund which started in 2002 manages about $6.2 billion today, with investments in US and China. The fund has now turned to South East Asia, Latin America and of course, India.

Tung explained that when the Gross Domestic Product (GDP) per capita of a company crosses $4,000 it brings in higher spending capacity. That’s when industries like e-commerce, live streaming and other forms of user generated content; take off.

“India is just under $2000, so over the next 10 years it’s going to be very exciting – India is at the cusp of something big,” said Tung.


Tung manages 14 unicorns in his portfolio at GGV Capital including Airbnb, Slack, Bytedance, Xiaomi amongst others. In India, he was an early personal investor in Flipkart and Snapdeal.

China bound? Hold on

Today, many Indian startups are heading to China. They want to accomplish bigger things in the faster and more developed market. OYO Hotels & Homes, India’s hospitality unicorn, went to China in 2017. And today, the country is its biggest market, bigger than India which is their home turf.


“What’s impressive to me is that many Indian companies know what their Chinese counterpart looks like. They have studied the business models in the Chinese internet space,” said Tung.

But Tung has a word of caution for these adventurers – speed.

“Speed is the biggest thing. When Bytedance came to India, they quickly made progress with their entities – TikTok. They are aggressive. When an Indian company goes to China if you compete in a pure internet space, it’s difficult. OYO has taken an offline hotel business which gives them some advantage. But if you want to go to China, you have to learn to be as fast as a Chinese company is,” said Tung.


Tung advises Indian startups to forget China and go after South East Asia instead. “In the SaaS network and service side, I’m not bullish about Indian companies entering China. I encourage these Indian companies to enter South East Asia – it’s an easier market with a lot more advantages,” he said.

The Alibaba Lesson

Tung was named in the Midas List 2019 by Forbes, which lists venture capitalists with the golden touch for unicorns. But he has also learnt his lessons along the way.


They were early investors in Alibaba in 2003, when it was valued at $180 million and they exited when it was worth $33 billion in 2012. Today, the company is worth over half-a-trillion Dollars!

“It taught us a lesson. When you see companies that are transformational, the upside is always bigger than you imagine. Ours was a nine-year old investment, everyone was happy with how much it had grown and we thought back then – well how much bigger it can get? No one thought it would be worth half a trillion Dollars,” said Tung.

Tung who is on the board of Xiaomi from its early days, and never imagined that it would become one of India’s top brands. “Lot of things have happened over the internet that you wouldn’t have thought was possible,” said Tung.


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