Chinese entrepreneurs aim to become technology power players

Alibaba was just the beginning: Get ready to hear a lot more about Chinese tech companies. China's technology industry, much like China in general, is undergoing a transformation. Entrepreneurs speak of an innovation "golden age" fueled by a mobile-device-obsessed culture, upward economic mobility and an influx of capital from investors locally and abroad.

First, it takes a lot less capital to start a tech company than in the past, thanks to the widespread availability and affordability of cloud computing and other business services that have brought costs down. That's true around the world, but especially helps countries like China, where millions of would-be entrepreneurs now have a chance to get a foothold.

The number of Internet users in China is staggering: By the end of last year, 618 million Chinese were connected to the Internet, compared with more than 250 million in the U.S. The number of smartphone users in China is expected to exceed 500 million this year.

That has made building a Web-based business extremely attractive. To wit, China's Internet giants Baidu, Alibaba and Tencent have exploded in popularity.

There's also a new entrepreneurial spirit found among Chinese youth that didn't exist just a generation ago, Gu said. As China has grown into a strong economic force, young people are more educated, have fewer financial burdens and have been freed from the pressure of immediately joining the workforce in the hope of landing a stable and lucrative job, he said.

Investors worry about regulatory hurdles and loose intellectual property rules, with some privately griping that many companies are mere copycats of U.S. ideas. Gu said people used to joke about a "C2C," or "copy to China," business model, but noted that entrepreneurs today are being pushed to create original ideas.

Going forward, industry watchers predict that Chinese tech companies will become more commonplace in the U.S.

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