FORTUNE — The “fail your way to success” model has been gospel for Silicon Valley venture capitalists and private-company investors for a long time. But in mainland China, that notion hasn’t fully caught on, said a group of influential investors speaking at Fortune Global Forum in Chengdu, China. That makes it hard for some entrepreneurs to find funding.
“Renminbi investors are not as aggressive and mature as U.S. investors,” says Wang Chaoyong, head of the China Equity Group, a Beijing-based private equity firm with some $3 billion in investments. “The concept of taking failure is still a problem, so foreign-funded VCs are still playing the dominant role.”
The panel, called “The Next High Tech Wave,” talked about the opportunities — and challenges — for startups in China. One issue for very young entrepreneurs, said Andy Mok, CEO of Red Pagoda Resources, which consults to startups, is that they are not as well-connected to politically powerful senior business and government leaders. That’s a problem in an economy that still has a lot of state involvement. Older entrepreneurs in their 30s, Mok says, are a better bet because of their “social capital.” “They know people you can call in favors from.”
There also are plenty of positives, however, primarily the utterly massive opportunity in creating businesses aimed at the 760 million mobile users in China alone. Pressed for specific names of investments by moderator Adam Lashinsky, Mok named a few, including Chengdu Pinguo Technology, whose product is 360Camera, an Instagram rival that was the fastest app in the world to reach 100 million users. The government’s willingness to subsidize innovation is another plus — one that means we’ll see many new technology breakthroughs in China in the years to come.