Chinese tech entrepreneurs build their startups to be copycat-proof, and it's one of their biggest advantages

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• Former Google China president Kai-Fu Lee has invested in 13 companies that have attained billion dollar valuations.
• Among his portfolio companies' most successful entrepreneurs, Lee identifies one key quality: They're paranoid.

Kai-Fu Lee is the former president of Google China and a technology investor who has funded both American and Chinese startups. Among his portfolio companies, thirteen have achieved coveted unicorn status with valuations of a billion dollars or more.

Many of these successful companies have Chinese entrepreneurs at their helm, who operate under a different mindset than the typical American entrepreneur. A key quality that these entrepreneurs possess is what Lee describes as being effectively "paranoid."

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Chinese entrepreneurs aren't afraid to duplicate good ideas, often resulting in a number of companies fiercely competing for industry dominance. In order to succeed, they build their companies early on with the intent to monopolize the market.

"They are paranoid that there are copycats everywhere, ready to copy what they did," Lee told Business Insider. "They are always thinking about the worst case scenario where these copycats could give away what they're selling for free."

This paranoia, said Lee, has been a key component in driving several of his companies' successes.

"It helps you stay one step ahead of the game so that you develop a business model so effective that even if someone comes in at a lower price, there's something you can do that they can't so they can't take your customers," he said. "The Chinese method to building a company is doing whatever it takes."

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