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Dialogue between Peter Thiel, Fu Sheng and Pan Shiyi on China’s bubble economy and “Zero to One”


Start-ups: bubble or hype?



Perhaps everyone getting involved in startups is a growing bubble, but would you worry about such hype? Sam Altman thinks that there is a tech bubble in China after traveling for a week around China, but no one here believes that. Comparing China with Silicon Valley, we would like to discuss whether there’s a tech bubble growing here.

当每个人都参与到众创,可能这是一个泡沫,你们是否担心所有人都进行这样的一种炒作?Sam Altman到中国走了一周他觉得中国存在泡沫,但没有人相信中国存在泡沫。从硅谷和中国来看,我们在讨论科技泡沫这个事情存不存在。


Peter Thiel: We have encountered several disastrous bubbles, including the tech bubble in the 90s and the estate bubble in recent years. I’m always being asked about this question in the U.S.. For the U.S., the bubble situation is nothing but another social phenomenon.



But in China, a greater participation of the public does not necessarily lead to bubbles. As investors and entrepreneurs, you should not just think about the tendency or follow others’ ideas. You should think by yourselves.



Fu Sheng: It’s hard to say whether there is bubble today, for I don’t do much research on economy. I think what Internet is affecting the most is speeding up the way we think, making us do things faster. Things which needed greater efforts in the past are soon organized.



We talk about methodology and Internet, and spread these theories. It might be a good thing. We arm ourselves with more updated knowledge and make it so many people are able to participate, which is generally good for everyone.



Pan Shiyi: We have been arguing whether there was bubble in real-estate over the last 10 years, and we are convinced that there’s no bubble, and some research has shown that we are right.



We don’t only think there is no bubble, but believe that our practice will not cause a bubble. We are making a fortune by investments. But a dramatic change occurred in real-estate during the last two years. When those that regarded it as a bubble had nothing to say anymore, we realized that the assumption they had was wrong.



When there are many failed enterprises in Internet business, they must have failed in setting a main direction for themselves. The prospects of Internet business are huge.



“Zero to One” theory in China



We have been discussing about the idea of “Zero to One” and “One to N” since Peter Thiel visited China 3 months ago. So what exactly are “Zero to One” and “One to N”?



Peter Thiel: “Zero to One” means doing new things, innovation as well as new tech, designing new enterprise models and social patterns, and more importantly, the technology to support it. “One to N” refers to imitating the methods that work.



China does well in “One to N” idea. Over the last 40 years China was superior to other countries in globalization trends, and has skipped many periods of often slow development elsewhere. Of course, China is also facing many challenges. When you try to imitate others, you should be aware that the first challenge is that thousands of other people are also imitating and you have to compete with them too.



In other words, China is leading the way similar to Silicon Valley. But it needs creativity to make progress.



In general, I believe people are working hard in China with growing entrepreneurship skills.



Chinese people are always convinced that the future can get better and they make great effort to achieve their dreams, which is quite a powerful drive.



Are there any enterprises and innovations reaching the standard of “Zero to One”?



Peter Thiel:Tencent. Many companies own mobile applications which are rather advanced. Alibaba is also very creative in its business patterns.



Xiaomi. Xiaomi deeply impressed us with its ability to combine low costs and high quality. That is also a kind of innovation from “Zero to One”, and it wouldn’t work without some innovation.



I’ve never known that history would predict future. The current China is totally different from what it was 20 or even 4 years ago. If we take a careful look at China’s past, we will realize that we have underestimated its potential in the coming 20 years.



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