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Why Chinese Innovation Fell Behind—and Why It’s Back

December 5, 2017, 3:36 AM UTC

The explosive growth of the startup scene in China is as much a cultural breakthrough as it is a great leap forward in tech expertise.

“Innovation is about disagreeing with old,” said Jay Walker, the founder of and CEO of, as well as a student of innovation throughout history. “In a Confucian culture, disagreeing with the old is a difficult problem. That’s the Chinese challenge.”

Before the year 1500, China “invented everything,” said Walker, who was speaking on a panel on Tuesday at the inaugural Fortune Brainstorm Tech International conference in Guangzhou, China. But it fell behind when the rest of the world embraced the scientific revolution, which is all about challenging conventional wisdom and testing hypotheses. That went against the Confucian way and it took the Chinese a long time to embrace the process.

Now China has adjusted. And that’s good news for everyone: It that means that the most inventive society in history is reemerging. China “is back,” said Walker.

Walker’s observations were echoed by Roger Luo, the president of fast-growing drone maker DJI. “I think we’re changing in China and having a new environment, and encouraging people to think outside the box,” said Luo.

Venture capital investment has surged in China over the past couple of years as the success of tech giants such as Alibaba and Tencent has helped foster a new generation of startups, as Fortune chronicled in the Dec. 1 issue of the magazine.

The power of the Web to connect China’s large population is another major factor in the growth of innovation, said Guangming Zeng, chief content officer of photo- and video-sharing app company Kuaishou Technology. “A young person from a Tier Six city can get same information as a person from a Tier One city,” said Zeng. And Zeng believes that China’s scale will continue to power new innovation. “When millions of people are committed to one thing, you can see inventions,” said Zeng.

Indeed, the digital era is perfectly suited to allow China’s strengths to emerge, said Walker. “Advantages of distributed collaboration, supported by digital tools, augur extremely well for China’s innovation.”

Walker offered one final piece of advice for China’s rising tech stars. “Innovators are generally not good listeners,” said Walker. But great entrepreneurs know that they need to have respect for customers’ opinions. They listen to their users in a thousands ways so that they can react quickly as opposed to slowly. That’s important to building a culture of success.