Networking, the term reveals a series of possibilities that stimulate the imagination. In the past year, this concept has been especially prominent in the venture capital community, demonstrating its unique charm and substantial significance. For example, a woman about to turn thirty, working in an industrial incubation park in Chengdu, majored in economics at a renowned university in Chengdu and had a brief Beijing drifter experience before focusing her career path on entrepreneurship and investment.
Through in-depth conversations with her, we can gain insight into Chengdu, considered one of the most vibrant cities in the domestic capital market, and the changes and developments in its venture capital environment in recent one or two years. Her memories of attending investment annual conferences illuminate her high regard for such events and the in-depth discussions she engaged in. During the talk, she expressed her envy of Shanghai’s advanced venture capital environment and discussed topics related to Chengdu, such as investment requirements, policy implementation, and institutional investment preferences raised at the conference. These discussions, in her view, were not necessarily negative because they represented recognition and enthusiasm for the region.
The “2023 Western Region Private Equity and Capital Market Development Report” by Invest Research Institute offers a data perspective, demonstrating that funds activities in the western region have been on a continuous upward trend since 2018, especially reaching an investment event peak in 2022. This change highlights the increasing centrality of Chengdu’s venture capital practitioners in discussions.
Interestingly, a similar discussion emerged once again during the recording of my podcast. In a year-end special, investors from different backgrounds were invited to summarize the past year’s work and look forward to the future. One friend emphasized the importance of “networking” when considering the direction of work for the coming year. When I tried to understand the reasons from past experiences, this experienced Chengdu venture capital practitioner acknowledged it but also had reservations. He explained that last year, after the pandemic, everyone focused on solid work and seizing opportunities, thus reducing such exchanges. However, he found that communication with the outside world remained indispensable and committed to deep conversations with industry peers.
In the densely interconnected venture capital industry, traditional “networking” events seem to be undergoing a re-evaluation process. Attendees are increasingly recognizing that such gatherings are not just lively venues for information and resource exchange but could also be platforms for strategic investors to capitalize on opportunities. This seemingly time-consuming and labor-intensive activity is being re-examined for its value and significance in contemporary business networking.
In the process of seeking new investment opportunities, the essence of “networking” is not limited to attending various conferences and events. It represents, to a greater extent, a proactive attitude—engaging in direct interpersonal interactions to access industry information and build connections. This behavior is usually closely linked to the participants’ business needs and personal professional experience.
Some attribute the enthusiasm for “networking” to lack of experience among practitioners, considering it a strategy for those new to the field seeking rapid development. Venture capitalist Johnson claims that he diligently attended various meetings when he first entered the profession, hoping to immerse himself and seize opportunities. He even learned to speak the Chongqing dialect from frequent participation, which shows his dedication and the immersive experience of networking.
However, as time goes by, Johnson believes that the returns from “attending meetings” are not very efficient. The repetitive social patterns have made him realize the limitations of this activity—exchanging basic information with potential partners, with plans to discuss things in depth later, but often stopping at likes and comments on social networks. This is far from the efficiency of a team delving deeply into a project.
The changes in the industry have also made him aware of the importance of specialization. As a seasoned venture capitalist, he no longer needs to “attend meetings” to unearth new projects; rather, the continuously increasing existing projects have already occupied all of his working time.
Despite this, Johnson has not completely abandoned the opportunity to “attend meetings”. When the attendee list includes people of interest, or when he has a clear goal to meet industry leaders, he will still carefully consider going. At this point, “attending meetings” is no longer a blind passion, but has become a targeted strategic action.
Social networking activities seem to go beyond just simple interactions now. For instance, Johnson shared with me an experience where he saw someone on WeChat who attended the same event, “I saw you were at that event at XX too“, and the other person replied, “Yeah haha, come out (referring to the tea break area outside the venue) for a chat?” This is like a situational social interaction.
Compared to this, Xiaowa’s experiences are richer and more complex. Her company rarely participates in such events, initially to increase visibility, sometimes to accept awards, but later even this became unnecessary, they would tell the event organizers, “Just send the trophy over“. Though there has been such a shift, Xiaowa actually enjoys attending industry conferences, especially facing the rapid changes in the industry, needing to stay on top of trends, like shifting from consumer markets to biomedicine. In such cases, industry gatherings become particularly important because she needs a “conference environment” to help bridge the information gap, even if it’s just to get a sense of what people are discussing, directing her learning path.
However, not long after, Xiaowa realized that attending these events did not have the expected effect, with the same companies often attending. She and her colleagues discussed this phenomenon, with some believing it reflected a shortage of projects, while others thought it was because they are in “new first-tier cities”, which have ample funds and strong development aspirations but often lack good projects. They concluded that a good investor should not just seek investment opportunities by attending events, and likewise, good projects should not seek investors through conferences. They also found that private, smaller gatherings were more conducive to in-depth discussions than exchanges at the venue.
But even so, attending industry events is not entirely out of the question. Recently, Xiaowa received instructions from her leaders, asking her to participate more in local venture capital meetings and events, and if possible, to speak on such occasions to articulate the company’s stance and objectives. Although Xiaowa has some dissatisfaction with these conferences that have become “cliché”, she understands that such participation is an essential part of attracting investment and cooperation.
My experience is similar to Xiao Wa’s; in August 2022, as a media representative, I participated in an inspection activity for the digital cultural and creative industries. At that time, the industry was facing the suspension of game licenses issuance, causing many game companies to worry about whether their projects could go live. The focus of this inspection was partly on the interpretation of policies, guided by the head of a publishing organization, discussing policy-level doubts and possible solutions.
After an anticipated itinerary failure, the topic quickly shifted to the issue of corporate team communication. After a moment of reflection, the discussion moved from the various association exchanges regularly organized by the Guangzhou company to the relatively inexperienced entertainment activities. He suggested that such exchange activities would be best held monthly, and the experience in Chengdu felt akin to a visit to a major company.
Not only entrepreneurs but even state-owned investment platforms of some cities are seeking to build brand images through more regular professional activities. Meanwhile, the person in charge also lamented that it is unrealistic and difficult for a single company to lead such large-scale events alone.
Observing a dinner event is enough to reveal the true situation behind it: arranged seats were arbitrarily changed, people gathered in groups, spontaneously assembling to chat, and from this, I also discovered the challenges of organizing activities. For investment institutions outside of the major cities like Beijing, Shanghai, and Shenzhen, the existing networks are already quite tight, and building more platforms for them to connect resources is no easy task.
Additionally, I met individuals who specifically create platforms for investment and financing activities in emerging cities, like Diego. Though Diego’s background and education did not fit into the venture capital circle, he successfully entered the industry by leveraging his insights and timing. In contrast to others who learn English with a utilitarian mindset, Diego believes that the simplicity of English allows him more time to plan his future career path. Therefore, he happened to meet a well-known angel investor who was in trouble due to a criminal case during his junior year of college.
“I am his student.” After showing a priceless photo with a distinguished angel investor, Diego turned to display his extensive WeChat friends list to me. Friends were carefully sorted into groups based on their professional roles in the investment industry, and there were many of them. When scrolling to those significant names, Diego would open their profile pictures and then show me the remarks he meticulously added—containing dozens or even hundreds of words, detailing why he added this person and the specific date, frequently asking me “Do you know them?”
“Since 2013, I have been fully invested in roadshow activities, although at that time, roadshows were only a part of the financial consulting job, whereas now, financial consulting has become a subsidiary to roadshows. After all, the rise of new first-tier cities is self-evident, attracting many institutions from other places to search for investment projects. At the same time, the local government’s shift in thinking regarding investment attraction policies is equally rapid, with each district having its own event support and specific targets.”
Starting this year, Diego’s company’s official WeChat public account has added a new column named “Running Club Guide”, which focuses on venture capital circle related activities in Chengdu city—including official meetings, industry exchanges, and various sharing sessions. The data collated by this column shows that in March 2024 alone, as many as 30 events were successfully held.
When I arrived at the scheduled café, I found an entrepreneur passionately reporting his fundraising progress to Diego. Dressed in simple attire—a backpack, a clean-cut windbreaker paired with jeans—the entrepreneur leaned forward eagerly and busily as he conversed, “We indeed need a sum of money to solve the immediate problems.” The entrepreneur stated, “Your side has abundant resources, and I hope to get your help.”
Unable to contain my curiosity about the enthusiasm investors and entrepreneurs have for participation, I asked Diego, “It’s very valuable for entrepreneurs to participate in these activities, at least they can understand the direction of capital, and then refine their projects. Entrepreneurs have definitely grown over the past two years, they know that capital needs its nourishment.” Pursuing the matter further, I queried, “So do these events really work?” Diego adopted an indifferent attitude and chuckled at me, “You should see these events as the fishing net I cast; my aim is to draw more fish into my pond.”
Although I didn’t wish to complicate the topic, the truth is I also gained some straightforward answers through constant interaction and exchange. For example, the popular conferences seem not to have reduced, but tend instead towards a flexible, semi-self-service style. Take the recently concluded SEMICON China, the world’s largest semiconductor exhibition, for example. Some comments said, “The enthusiasm of investors exceeded imagination” and described the conference as a “lively yet practical three days,” with focus shifting from bubble topics to business and orders. In various industry discussions, “engaging with clients and signing letters of intent” took center stage.
I’ve considered that such fervor might differ across various industrial tracks. For instance, in consumer-facing sectors like gaming and consumer goods, investors have probably never decreased their participation in industry conferences. This was confirmed during my visit to the Chengdu office of Peakstate Capital. Their desks brimmed with product materials from the 110th National Sugar and Alcohol Fair, and I was told these were the outcomes of their Sourcing team’s efforts.
Currently, the twelfth China Ingredient Ecommerce Festival held in Wuhan, China, has attracted many industry insiders’ involvement. Participants displayed a positive attitude towards this industry event, and there was no excessive discussion about market reignition. However, in this industry cycle, simple questions may no longer have simple answers. Even though the buzz from the previous SEMICON China exhibition seemed conclusive, such a conclusion might not be precise.
A friend of mine shared his thoughts after SEMICON China ended, and he vented to me: “Regarding the SEMICON exhibition, people in the secondary market are gleefully discussing new orders, new products, and the future development direction of various companies, while those in the primary market have expressed peculiar views like ‘Attending the exhibition is just to show that one is still within the industry’, ‘Public exhibitions are meaningless because all information is known to everyone’, and ‘The primary market is more concerned about intelligence warfare’.” Some people seem to think that publicly participating in the exhibition means there is no informational value, isn’t this an arrogant attitude?
He continued: “Even when it comes to watching beautiful women at the exhibition, the primary market audience seems rather indifferent, while there are no shortage of gorgeous models hired by various companies at the SEMICON, which the secondary market notices right away. Even within the primary market, there are complaints about the lack of beautiful things… This to a certain extent shows that, over the past two years, the primary market has become even more restless than the secondary market.” Perhaps everyone is looking for a sense of security. This perspective is quite interesting: deep down, people may indeed recognize the value of the exhibition, but because they haven’t gained much, they seek psychological comfort by mutually confirming that the other party’s gains are limited.
A seasoned professional quickly responded: “The secondary market starts speculating on stocks as soon as there is a new product, new order, or new concept, which is a sign of restlessness. And the primary market, even with beautiful models at the stand, cannot sell old stocks because of it, which instead shows its stability.”
