Matt Sheehan is a fellow at the Paulson Institute and writes for the think tank’s site MacroPolo. He spent over five years in mainland China, including two as the first-ever China correspondent for the Huffington Post and WorldPost. He now lives in California where he consults on market entry and communications for China-related projects, and is writing a book on China-California relations, “Chinafornia: Working with Chinese Immigrants, Investors and Ideas on U.S. Soil,” for release in 2018.
Young China Watchers (YCW): What led you to reporting on China for the Huffington Post? And what were the challenges distilling China’s complexities and nuances into understandable narratives for a US audience?
Matt Sheehan (MS): I arrived in China to live in 2010, and reading the books and articles by other journalists really enriched my understanding of the country. But I also felt there was something missing from it. When I talked to friends back home who’d never visited China, I found that they had some sense of the high-level political issues—corruption, censorship, suppression of dissidents—but they didn’t really know much about what it was like to be an ordinary Chinese person living a normal life over there.
I was living in Xi’an and then Beijing, and found the lives of my Chinese friends both really relatable and inspiring in their own way. Giving people a sense of what average people in the other country are like is so important for building a foundation under the relationship between these two countries, and I wanted to be part of that. So I scrapped around the edges of China journalism, translating and writing for China blogs and websites. Eventually I got lucky and got a full-time gig.
Framing up such a complex country is definitely a challenge, but I found the more you zoom in—the more closely you tell one person’s story—the better you could hold readers’ attention and hopefully convey those big-picture issues.
YCW: What prompted you to transition from journalism to consulting on China-related projects in the U.S.?
MS: Chinese has a phrase: “站着说话不腰疼” (“You stand there and talk, but your back doesn’t hurt”). It’s a critique of the kind of idle commentary from people who don’t actually get their hands dirty. I love telling stories about what other people are doing, but I also wanted to get involved in building this relationship in a slightly more tangible way.
Transitioning out of daily journalism gives me the freedom to work with companies or organizations that are doing impactful things at the ground level. I still write both journalism and analysis, but I can be more intentional about what subjects I cover and more opinionated in the analysis.
YCW: With China transitioning towards a consumer-driven and services oriented economy, what are some of the key areas where American businesses need to evolve their China strategy?
MS: I think it boils down to being realistic about what you can achieve given the industry that you’re in. There are some industries—namely the internet and media—where a U.S. company is going to have a permanent uphill battle, one that the Chinese government really does want you to win. That doesn’t mean it’s impossible: Uber’s sale to Didi and its stake in that company are likely very profitable. But if there is a less expensive and lower maintenance way to derive revenue from the market, it should be considered.
Netflix is a good example of this. Given that it’s an Internet- and media-driven company, it was going to be damn near impossible for them to thrive in China. So instead they struck a licensing deal with local video site iQiyi to get some of their shows in. That deal is nowhere near as lucrative as winning the Chinese market would be, but that probably wasn’t in the cards. By partnering or licensing, the companies can stay at arms-length from some of the thorny ethical choices of operating a content company in China.
All that said, I think there are huge opportunities to companies that are selling hard goods or lifestyle brands: sports, health products, food, etc.
YCW: The economic transition has also seen Chinese tech and venture capital (VC) firms go global, and Silicon Valley is a major destination. What are some of the challenges they face investing in local operations and selling to American consumers?
MS: In terms of investing in U.S. startups, Chinese VCs lack the personal networks that let you in on good deals. My friend Rui Ma who invests in both countries put it well: If you want to invest early in a really good company, you likely have to know the founder before they even start the company. Chinese VCs who just landed here don’t have those networks yet, and many can only get in deals where startups are desperate or want to inflate the valuation.
For Chinese Internet companies targeting U.S. consumers directly, they’re going to have an extremely difficult time both winning user trust and building a product for Americans. Many Chinese products are extremely tailored for China’s crazy Internet ecosystem and urban environments, not to mention government relations. Lots of products built for that ecosystem aren’t a natural fit for American users, and they face strong incumbents in their U.S. competitors.
YCW: Can you share some of the “secret sauce” to speaking excellent putonghua, building a popular public profile on Chinese social media platforms, and generally cultivating cross-border networks? Something for younger China watchers to take note.
MS: In terms of the language, I’d emphasize hours and imitation. Hours, meaning there is no shortcut; you just have to put in the damn work. Imitation, meaning you should constantly be listening to and imitating the Chinese people around you. Westerners, especially Americans, tend to look down on imitation or memorization – they want to create their own Chinese sentences. If you do that you’ll sound awkward. Better to constantly imitate what you hear, and once you have enough of those tiny pieces you can create something really original and really native-sounding out of it.
For social media, once you’ve got your language chops (or even before you do) then just start putting stuff out on the Internet. Some videos that I put up as an afterthought ended up blowing up and got half-a-million hits. It also helps to be goofy as all hell – really 不要脸. Chinese Internet audiences often dig that.
For these networks or friendships more broadly, it’s all about putting yourself out there and not being timid or afraid of looking dumb. I find that as a foreigner in China, the more you give, the more you get back. If you embrace the people around you, they’ll often embrace you right back.
— Interview by Dev Lewis