Just as international companies – eBay, Groupon, Google – struggle when entering China, Chinese companies often run into challenges when trying to take their business overseas.
That’s the opportunity SparkLabs wants to capitalize on. The Seoul-based accelerator launched SparkLabs Beijing today, the first of many China-based branches. Accelerators in Shanghai, Chengdu, and Shenzhen are slated to open on May 15th. SparkLabs is also aiming to launch a fintech-specific accelerator in Hong Kong in September.
“Our focus is on helping China’s entrepreneurs go global, so we are really focused on providing resources and development to prepare them to hit their next target market, whether the U.S. or elsewhere,” Bernard Moon, general partner and co-founder of SparkLabs, tells Tech in Asia over email. “Or if they are ready, we can help slightly more mature startups right away.”
The first batch will start in mid-July. SparkLabs Beijing’s focus will be fairly broad, looking out for startups in AI, VR, AR, IoT, gaming, mobile, fintech, and healthcare.
“We will just avoid industries that take a lot of capital to prove out, such as pharma and cleantech,” says Bernard.
After undergoing the three-month accelerator program, startups will be able to receive up to US$50,000 in capital for up to 6 percent in equity, though SparkLabs hasn’t decided what the minimum investment amount will be. In addition to funding, office space, and mentorship, SparkLabs startups will also have access to the accelerator’s network of entrepreneurs, venture capitalists, angel investors, and executives.
SparkLabs, which has so far run a total of nine three-month batches in Seoul, is no stranger to helping startups expand abroad. Due to the size of the South Korean market, many local startups end up looking at the US or nearby countries, such as Japan and China, after gaining traction in their home country. In addition, the Korean accelerator is also affiliated with SparkLabs Global Ventures, a separate seed fund headquartered in the US that invests in startups all over the world.
According to SparkLabs, 79 percent of its 65 #startup graduates have received funding so far with an average over US$3 million. The average amount of funding raised before startups enter SparkLabs’ program is over US$400,000, the accelerator claims.
Still, expanding into China won’t be easy. A slew of international accelerators already operate in China, including Microsoft Accelerator Beijing, Plug and Play, Startupbootcamp, and Chinaccelerator and HAX – two accelerators from venture capital fund SOSV. SparkLabs will have to compete with them to attract talented early-stage startups to its accelerator in Beijing.
SparkLabs is launching its Beijing branch together with its local partner, Guoan Academy, a subsidiary of CITIC Guoan Group, which is an industrial subsidiary of state-run financial institution CITIC Group. Bernard says the discussions with Guoan Academy began over a year ago and are now coming to fruition.
“I believe our patience has paid off with the best partner out of the three we were in discussions with,” he says.
SparkLabs Beijing will be led by managing partner Colin Qu, and is backed by two venture partners: Gang Lu, founder and CEO of media company TechNode, and Sun Shaw, the former CTO of Kingsoft. Its advisory board includes Justin Kan, co-founder of Twitch and former partner at Y Combinator, Lili Cheng, the general manager of Fuse Labs at Microsoft, and Eric Ly, co-founder and founding CTO of LinkedIn.