Financial Post China Series - Great Reading

Very insightful and good primer on China market and doing business on the mainland can be found in the National Post financial section here.

Blogs I like to read

Some blogs that I read regularly include:

http://www.mediavorous.com/ - By my friend Brad Berens. Very insightful commentary on digital media space

http://www.shanghaiist.com - a must read for those living or visiting Shanghai

http://calgoldenbearfootball.blogspot.com - for the Cal football fan

http://blog.pmarca.com - a well-written blog on a variety of topics. I recently found new music on this blog. Rodrigo y Gabriella rock!



Until I learn how to link them properly using the features of blogspot, this will have to do.

More Coverage on Weinstein Asian Fund

More information on the Weinstein Company Asian Film Fund previously mentioned here. More details surfaced on specific business operations and projects. What quality of films can we expect to see out of this new endeavor?

How will Yi compare to Yao?

This story is taken from the NY Times a few months ago, before the 2007 NBA draft. However, the most relavant point is how much of an impact will Yi JianLian make in the NBA? How will his game match come play time? Will he be able to transition well from the CBA to the NBA? There are billions of dollars at stake in China for the NBA and Yi is just as integral part of the puzzle as is Yao. I haven’t seen Yi play much but seems like people are pretty split about his ability. Some say he’s simply amazing, other have serious doubts.

No matter how he plays, the China market is a growing one for all professional sports from the world. Football is coming in, NFL is coming in, NBA is here, NHL wants in, etc. Just a market that cannot be ignored. And make no double, the Chinese know about this.

The Return of Bob Nardelli

The return of Bob Nardelli

Bob Nardelli is back in the CEO slot. Chrysler elected Nardelli as Chairman and CEO recently. It was only back in January that Nardelli resigned at CEO of Home Depot after a scandal over his pay package and sagging Home Depot performace.

Nardelli certainly is not back for the money. But this will be a great opportunity for him to restore and prove his reputation. Nardelli comes from a highly respected background as he was previously a top executive at GE. He was even a finalist for the CEO spot at GE when Jack Welch was looking for a successor.

I believe Nardelli has the ability and proper motivation to make impact at Chrysler. I’ll be watching closely to see how this works out.

Link to AP article.

Rare: Authentic Chinese Food in the US

Even as a child I wondered why the food in Taiwan was so much better than the food in the US. Not only is the food cheap but also more flavorful; at least to my amateur palette. But I always enjoyed Mom’s homemade cooking. I thought it was just a difference between home cooking and restaurant food.

However, after moving to China, I discovered a vast hidden gem. After 3.5 years in China, I can no longer stomach Chinese restaurants in the US. Even in LA or NY there are only a handful of Chinese restaurants that cut it. And those are easily blown away by the best eateries in China. I even had better China food in Australia. I wondered why this was the case. With the population of Chinese and Chinese-food connoisseurs in the US, it didn’t add up. Those of you who have been to China, Taiwan, or HK will know what I mean.

Well, this NY Times article makes a lot of sense. Seems like twenty years ago it was a case of spices and ingredients hard to come by. Now with global trade, it’s a problem of work visas for chefs. Looks like with the current immigration policies, we won’t be seeing great Chinese food in the US anytime soon.

Children of the Web

This is where web 2.0, globalization, and youth culture collide. Businessweek’s recent article on marketing to the global youth culture highlights the importance and advantages of using the web to bring products to younger consumers. Case studies include Axe deodorant spray. I must be older than the target demographic. I thought Axe was a pretty cheesy product judging from their product package and their scent names. But now reading their commanding and growing global market share, they are clearly doing something right.

The most interesting thing I find about this article is that the web is finally starting to show promises of the early hype of global connectivity. We are starting to see it happen. A new product or movement is introduced and within minutes it can be spread globally. We no longer need to rely on TV. Teenagers all over the world can share the same clips via Youtube and share party pictures via Facebook. The world is so much smaller. We can make friends and stay in touch with people all over the world. Cultures are shared and experienced much more easily across geographic boundaries. These are exciting times. Marketers are embracing this knowledge and coming up with some lucrative results. Teenagers are leading this charge but the connections will spread to all age brackets; just a matter of time.

Of all the companies profiled in this article, I find the FRIDAY CLUB the most interesting and personally relevant.

“The target customer for major brands is someone like Malini Agarwal, a 30-year-old radio deejay in Mumbai. After growing up all over as the daughter of an Indian diplomat, Agarwal settled down in the city and two years ago launched Friday Club, which organizes social gatherings and now has branches in four Indian cities plus Hong Kong, London, New York, and Toronto. The club's multinational members make plans, keep in touch, and share photos via social networking sites. "It's a global family," Agarwal says.”

I’ve thought about starting something like this for the Chinese set recently. I need to get off my butt and just do it. Less thinking, more action. It’s something that would work incredibly well in China and for Chinese all over the world.

Asian Star from America

Asian American actors continue to make breakthrough in the international spotlight. This article from LA Times introduced me to actor Daniel Henney. Henney is an American-born Korean from Michigan. A few years ago he went to Korea for a TV commercial and now he has become a full-fledged star around Asia. Looks like he's taking a space right next to Takeshi.

He's not the first Asian star from the West. There are Daniel Wu, Wang Lee Hom, Maggie Q, Karen Mok, and many more. What’s particularly interesting about Henney’s career is that he has made one by playing a genuine Asian-American. He plays the role of the outsider in Korea TV dramas and feature films. It’s refreshing and a breakthrough. I don’t know if a American-born Chinese would be able to achieve the same level of success in China playing the ABC.

Anyway, I look forward to seeing how his career grows and if he can take the “pretty boy” idol status his fame currently depends upon and really run with it. Will he be a worldwide star?

Sonos: An alternative music distribution system

The future of music is uncertain. Most uncertain is the how music will be distributed to consumer in the future. Currently CDs are on a major decline and digital download purchases and mobile purchases are on the upswing. However, given all the complicated rights management systems competing, the consumer experience is a frustrating one at best. Apple iTunes seems the do the best job at the moment based on sales. However, a compelling alternative is the combination of Sonos and Rhapsody. Sonos is a in home system that lets you wirelessly fill every room of your house with music. The subscription system means that for a small fee, you can listen to any and all songs on the Rhapsody home system. I think this is a great bargain and you are licensing music and only pay about $10 a month. That’s a real deal when you can listen all you want.

The only thing is how to get this system out of your house and into a ipod or similar portable system? When they can figure that out, then this system can really take off.

Take a look at reviews on Sonos at Business 2.0 and WSJ.

The Amazing Steve Wynn

The story of Steve Wynn is a mesmerizing and inspiring one. He was about to retire after the success of Bellagio. However, he decided to bet it all because he believed it had one more in him. He went all in with Wynn Hotel and now had two super-successful properties in Las Vegas and Macau. And he’s just beginning. He’s brought great change to the imagination and dream of Las Vegas and these two articles prove he is affecting change both big and small. The first from Time and the second from WSJ.

H-P: The PC is not a commodity.

The PC is not a commodity. Realize your competitive advantage, maximize it, and gain the market share lead. Sounds simple, no? As reported by WSJ, that's the lesson we learn from H-P as it realized a better way to take on Dell.

Apple has definitely proved that personal computers do not necessarily have to be a commodity item. Just look at the waves of fanatics that Apple has cultivated to its brand of iMacs, Macbooks, ipods, iphones, iTV, etc.

Companies like H-P and Dell need to continue to innovate and find strategic partners (Best Buys, Circuit City, etc) to come up with more innovative ways to retail their products in order to be more in tune with consumer taste and trends.

Bill Gates: The barrier to change is not too little caring; it is too much complexity.

I’m late in blogging abouit this item but I feel it’s important enough to bring up. Bill Gates gave the 2007 Harvard Commencement speech and the topic of his speech helping solve the issue of inequality around the world. He mentioned there has been no better than for people to help others given the amount of information and connective-ness brought by the Internet.

I tend to agree with him. We can all do more to help those in need, especially people around the world that do not have a voice or do not have the power to improve the situations around then. What we do can vary in degree of commitment and level of impact. But what’s important is that we realize we can all do something to help make this world a better place. It can start out as something small. Just helping a friend, helping a neighbor, or just donating $20 to a foundation you champion.

I have been working on One Foundation for the past several months and I’m amazing by the amount of networking and progress that I can do remotely even while our office is in Beijing. I come across a lot of people with good hearts. It’s good to see that people care. I want to see this feeling spread around the world and especially more among Asians and Asian youth.

Hong Kong is one of the most philanthropic cities in the world per capita. It would be great if we followed their model of care and giving? Let’s all work together in both business and philanthropy. The two are not mutually exclusive.

A good book about this subject is How to Change the World. You can find the full text of Bill Gates' commencement address at gatesfoundation.org.

The General Electric Company

I’m a big fan of the General Electric (GE) company. I admire the new innovative products that it’s pushing out to market. I respect its management and I agree with the company’s general direction under the leadership of Jeffrey Immelt. I read that NBC (GE is the parent company) is able to bid so much money for the rights to the Olympics games because once it secures the bid; it becomes a prominent and strong partner to the host city. GE is the able to secure high-rating programming and able to leverage its other business divisions to help the host city build the infrastructure, and thereby recoup the investment. GE can provide capital/financial solutions, infrastructure building products, healthcare and security components and a host of other products. For the Olympic Games, GE is really able to throw the advantages of being a diversified conglomerate.

This NY Times article nicely summarizes Jeffrey Immelt’s first five years on the job.

Asian Film Funds

Two news articles about Asia-focused film funds. The first article on the A3 film fund reported by Variety and the second article on the Weinstein Co.’s $285 million Asia fund reported by Bloomberg. Both articles informative and brief with enough details to give the strong impression that Asia-focused film funds will continue to sprout in the short term. As Felix Zhang of Artesian Capital Management says in the article, these types of films funds are exotic and unproven. However they are appealing as the movie industry across Asia is growing where box office in North America is shrinking. Asia is still developing and there’s still room here for more competition.

Digital Music Market in Asia

I was surprised to learn that digital music in Asia is as large of a market as here in this Variety article. But once I thought about it, it made sense. In China and Asia, teenagers in particular use their mobiles phone all the time. It’s part of their identity. The music they play on their phones as the ringback or ringtone is also something they change all the time. China mobile and the other service providers support their mobile music download service with a prominent advertising campaign.

So while CDs are mostly pirated here, the more you push mobile music here in Asia, the stronger the legitimate music market will become. So it seems to me that Apple should be pushing their iphone very strongly in Asia. It makes sense as the killer app on the iphone is in fact the itunes software. And Asians, by far more than any other geographic population, download using mobile phones. According to this article, China accounts for 80% of the music download market. I would have thought South Korea or even Japan. But once again, I think the sheer population size makes China the default market leader.

I’d be interested to learn more about the mobile music download firms here in China and learning what opportunities exist. Anyone have related info to share?

User beware: Facebook

I’ve always taken caution when placing my personal information on Facebook (and all other social networking sites in general). A lot of the information I put on a site like Facebook is very personal and used in many secure transactions. So I’ve always felt the need to take caution. This blog makes a justified case as to why I should so careful. I recommend you to take time to read the post and view the video as it provides a brief and information education on how sites like Facebook work. The video exaggerates the dangers of Facebook but the point of the video is clear: You are selling your information to the social networking sites by putting it online. The sites are free to use the information as they see fit. This is just something to keep in mind and certainly no cause for panic. But next time you decide to update your Facebook, Myspace, Friendster, or other social networking profile, stop for a moment and consider if you really want that information available out there.

Block Party

Damon Dash is a bold man. I like his attitude and his frank answers to questions. He doesn’t bullshit and is proud to say what he thinks. Dash is known as a hip-hop impresario as co-founder of Roc-A-Fella Records and Rocawear. Incredibly successful in both endeavors Dash is now on the social networking bandwagon with Blocksavvy. I think it’s a very interesting idea. Haven’t played on it long enough to know weather or not it will work. But I believe it will. Dash is in touch with urban audiences and if he can drive them in masses to the digital space, he can surely monetize that advantage. Business 2.0 Magazine has a well-written article here.

The Entrepreneurial Lottery Winner

I stumbled upon an article about lottery winner Brad Duke. In 2005, Brad won a $220 million lottery and took home $85 million lump sum after taxes. Since then he’s invested the money very wisely in real estate, fixed assets, secure investments, stocks, etc. He has a team of full-time advisors working for him. In 12 years his goal is to grow his net worth to $1 billion. This is a guy I can really admire. He wants to do it so he can give back and do the things that he wants to do. He talks about this plan in a recent article in Fortune Magazine.

A lot of lottery winners meet misfortune because they don’t’ know how to manage their money and end of spending all of it and declaring bankruptcy. Brad’s way of managing his sudden wealth is definitely the way to go. He still keeps the same job he had before as a fitness instructor and drives the same model car. Lots of luck to him. And here’s hoping some of that fortune runs my way!

Daniel Wu "Heavenly King" Interview

Just finished reading this interesting interviewing with Daniel Wu on indieWIRE. It’s an interview that took place at the end of April during the SF International Film Festival. Daniel’s directorial debut, THE HEAVENLY KINGS made its stateside premiere at SFIFF.

Daniel is a Bay Area native and attended UC Berkeley. (Go Bears!) The interview nicely touches on the state of HK and Chinese film industries as well as the music industry in Asia. Also featured in the interview are Daniel’s co-stars in the film, Andrew Lin, Conroy Chan, and Terence Yin.

Extreme Wealth – Blackstone CEO Schwarzman takes home $400M salary in 2006

I thought the $54 million 2006 salary for Goldman Sachs CEO Lloyd Blankfein was unbelievable. Now comes news of Blackstone CEO Stephen Schwarzman making $400 million in 2006. This profound news has put a gigatic spotlight on Schwarzman. Private equity has entered into everyday vocabulary just as venture capital became common lingo during heydays of the dotcom era. Read about it on AP.

How to achieve a four-hour workweek

I think a four-hour workweek is something that would appeal to a lot of people. That leaves another 164 hours for golf, travel, afternoon tea, and other leisurely pursuits. I stumbled upon this concept from “The 4-Hour Workweek” by Timothy Ferriss. I haven’t read the book yet, but I plan to pick it up soon. One of the ways Ferriss talks about achieving the mythical four-hour workweek is to outsource certain tasks. Interesting enough, I read an article in the Wall Street Journal titled, “Outsourcing Your Life” a week ago. Sounds like a good idea to me and I’m certainly going to look into it.


“The 4-Hour Workweek” by Timothy Ferriss @ Amazon:
The 4-Hour Workweek by Timothy Ferriss

Nuts about Rice

Consumers in Japan have a great appreciation for high-quality white rice. In fact, that there is an entire market for rice cookers costing over $300. These high-end rice cookers are like XBOX-es for housewives. The newest entry into the field is from Toshiba. The machine costs over $800 and took more than four years to develop. This is all very fascinating. I’m not usually a rice eater because it’s carb-heavy; but whenever I go to Japan I can’t help but eat at least a bowl of rice with each meal. I appreciate how everything is an art to the Japanese and they demand the best things in life. You can read up on the high-end Toshiba rice cookers at wsj.com.

Private equity continues play in film business

A recent article in Variety reported that Lionsgate, the mini-studio, has just announced a slate of 23 films in a financing deal worth $400 million over the next 3 years. This is a big commitment for the studio and highlights its ability to produce mid-range fare at a conservative risk profile.

A couple things I find interesting from this article:

1. Goldman Sachs was involved in arranging financing. GS is no stranger to large-scale film business deals. They had a hand in the Weinstein Company $1 billion capital fundraising, the $2.1 billion purchase of Alliance Atlantis (included a 50% stake in the CSI franchise) and the $3.6 billion purchase of Endemol. GS is obviously committed to the industry. And its deep commitment show that the glow of Hollywood has not dulled. At a time when large studios such as Disney, Universal, Warner Bros., Sony, etc. have reduced their production slates, it’s interesting to note the rise of private equity players into the market.
2. Lionsgate most profitable franchises are excluded from this deal. I’ve always wondered why private equity gets in the game if only to participate in new and unproven titles. True, original titles can lead to big box office results. In addition, original titles are fresh. However, how can the studios keep the most profitable and guaranteed franchises to themselves and only open the doors to equity for their slates of original titles. For private equity, it seems risky. However, Lionsgate has proven its track record over time, particularly with the Saw and Tyler Perry franchises. It’s a wait and see scenario to see how these equity plays will pay off for firms like Goldman. But my bet is that with their business expertise, GS has not entered the market without substantial research and at least a sense of guaranteed returns on the backend.

Overall there is a glut of available money available in the market. That’s great for films and filmmakers. And it also provides a nice way for financiers to get into the sexy business of Hollywood. I say, “Play on!”