Shenzhen Valley Ventures (SVV): Interview with Entrepreneur Chadwick Xu

Chadwick Xu
Shenzhen Valley Ventures (SVV) is a technology company that was founded by successfuly businessman and entrepreneur Chadwick Xu.

Shenzhen Valley Ventures (SVV) is a company that prides itself on pioneering innovation. With a mission to support the growth of young startup founders as well as innovation-focused teams at corporations, SVV is an engineering and manufacturing company specializing in the development and manufacturing of devices for the fields in med-tech, agriculture, and AI integrated devices.

Chadwick Xu is the co-founder & CEO of SVV, which is still in its startup stages. Chadwick also co-founded ZOWEE Technology which is one of the largest manufacturing companies in China. The factory was founded in 2004 and currently produces over 100-million products annually for clients including Nokia and Samsung.

Chadwick Xu’s successful career has led him to speak on World stages such as Web Summit and TechCrunch. He now feels that his companies are facing interesting times given the political and economic issues presently facing China and the world at large. Inspired by a 1979 speech by visionary Deng Xiaoping, Chadwick moved to Shenzhen in the 1990s to follow his dreams of success. At that time, Shenzhen was a small village on the border of Hong Kong containing approximately 100,000 people. Since then, the area has experienced a boom in growth and is now home to around 20 million! When Chadwick first arrived in Shenzhen, his life wasn’t easy. He took a job in a headphone factory that paid less than $100 dollars a month. Chadwick’s big break came when his company needed someone who was fluent in English to help assist with international sales. Having studied English from a young age, Chadwick was granted the position.

Through his job in international sales, Chadwick got relocated to Los Angeles for five years. After returning from America, he and five associates decided to start their own company and this blossomed into ZOWEE Technology which focuses on building machines that make other, smaller, machines and parts faster and more efficiently. Although he officially retired a few years ago, Chadwick’s entrepreneurial nature led him to develop his second company, SVV, which he described as the first “smart” money VC firm that offers both investment and engineering expertise specializing in low-volume complex B2B devices. SVV has partnered with many startups and corporations.

Chadwick recently discussed his career, companies, and hopes for the future via an exclusive interview.

Meagan Meehan (MM): How did you initially get interested in business and why did that 1979 speech have such an impact on you?

Chadwick Xu (CX): It’s actually the 1992 speech made by Deng Xiaoping in Shenzhen. Back then, all university graduates were assigned a job by the government, mostly in the government or government-owned enterprises, and most people ended up working in the assigned entity for their entire life. An assigned job provides the security of living, especially in the age of general poverty, but it limits the possibilities of being young. China started its opening-up policy in the early 1980s, and there are already many inspiring success stories of private businesses, but there is still a huge concern that China may go back to the previous track and contain the growth of private businesses, Deng’s 1992 speech is a clear statement that China will continue its opening-up policy, and encourage private business to grow. It offers a whole career plan for young people that looks for a more adventurous path.

MM: You started learning English at a young age, so how did you know that learning it would be so important?

CX: Learning English is mandatory in China from junior high all the way to a doctoral degree, with the opening up of China, English has continuously become more and more popular, I think this is part of the opening up strategy, to enable its population to understand and learn from the west.

MM: What did you learn from your own time working at a factory?

CX: I worked as a frontline worker for 3 years, practiced almost every working station at an electronics factory possible. Looking back at this experience, the most I learn from it is that:

  • Practice is always different from thinking; you can learn more and understand better if you try practicing it.
  • People count the most. In a factory or any other business, management & procedures are implemented by people, the same procedure may generate a totally different result if the people are different, there is no generally applied management or procedural process, it always needs to be adjusted based on the nature of the people each business has.

MM: What prompted you to start your companies and how tough was it to get them off the ground?

Chadwick Xu
Chadwick Xu is the co-founder & CEO of SVV, which is still in its startup stages.

CX: Shenzhen is the place for ambitious people, many come to Shenzhen for the purpose of creating their own business. The general path is to work in a large-size enterprise for a few years, to learn and build connections, and then start their own (company), this is also the same path I went through. The first one, Zowee Technology, an electronics manufacturing facility, was launched smoothly in 2004, the company got profitable in the first year of establishment in 2004, and remain so to the date we brought it to an IPO in 2010, the major challenge we had was during the 2008 financial crisis, our biggest client in the US went bankrupt, the bad debt loss nearly derailed our company, but we managed to develop a replacement client, although still suffering a considerable loss, but the damage control made the risk exposure manageable. The second one, SVV, is more challenging than Zowee and I think this might be the normal pattern for creating a business, especially for a business that is in the innovation and startup industry.

MM: Why do you like making machines so much?

CX: There are two sides to a coin, for people from my generation, we grew up in an age of machines, the building and selling of these machines were the major business opportunity in the electrical industry during that time. Now times have changed, the driving power switches to AI and IoT, even though the real demand for hardware is to collect data and execute the deliverables, the core value falls onto software & algorithms. As part of the old industry, what we can do is to contribute our resources and ‘know-how’ on the hardware side, to help the new generation of AI to develop their applications faster, and in return, they can bring us into the new economy fueled by software.

MM: Which of your creations are you most proud of and why?

CX: We have spent 4 years co-developing an earthquake data collection system with Peking University, after approval of China’s Earthquake Bureau, the system was deployed nationwide across China, and TBs (terabytes) of data is collected annually. Now there are hundreds of researchers who have joined the data mining program. The goal is to build an algorithm that is able to detect and predict earthquakes days (eventually weeks) in advance! The development and experimentation of this project may continue for years, even though it’s still unknown whether this design could be achieved, but the progress made so far shows a promising outcome, and it will definitely contribute extremely valuable data to the study of earthquakes, landslides, fault-zones, and other natural disasters.

MM: You do work for many fields, but are there any industries that you would like to branch out to in the future?

CX: We have determined two fields to focus on, portable connected medical devices, and environmental monitoring devices. But we will continue to scout other potential opportunities and see what will be our next focus in the future.

MM: How did you get to work with Nokia and Samsung?

CX: Nokia and Samsung are the clients of Zowee. Zowee is one of the leading wireless manufacturers in China, and it has been a manufacturing partner for Nokia and Samsung for their wireless devices. SVV doesn’t have a working relationship with them yet.

MM: What’s your favorite thing about being an entrepreneur?

CX: Besides the fun of leading a team, and rising up to challenges day to day, personally, my favorite part is that as an entrepreneur, there’s a full community of smart people with different backgrounds, brainstorming, or even debating, with these smart people is really mind-opening.

MM: How did you get into doing talks and speeches and what subjects do you typically discuss at these events?

CX:  Personality-wise, I am more of a listener. During the creation of Zowee, none of the founding team took any media reviews and we even purposely avoided dialogue with the media. But SVV is a platform designed to support startups, after individual conversations with entrepreneurs, I realized that the lessons we’ve learned, the experience we’ve accumulated in the hardware industry is a valuable resource to these startups, especially for teams with a software background, the facts we learn we take for granted, as it’s natural to us, but sometimes this information turns out to be new and interesting to them (startups). On the other side, we do need media exposure so that more startups can understand more about what we do, this is why we are gradually changing our attitude toward PR and marketing, it’s a difficult change for us, media was not our original channel, and we are learning how to provide informative information and insights to media, so that we can also contribute some value to our media partners, instead of general commercial promotion.

MM: What advice would you give someone who is starting their own business?

Chadwick Xu
Chadwick Xu’s successful career has led him to speak on World stages such as Web Summit and TechCrunch.

CX:  There is no ‘perfect formulae’ for easy success. The companies who survive usually have a misleading story, as success comes from a combination of things, smartness, capital, positioning, luck, business model, etc…. However, persistence may sound vague, but in reality, it represents months and years of physical and mental torture during each major challenge. Cash flow is also very important, regardless of how great the innovation is, a business can’t sustain without abundant cash flow.

MM: How do you see China—and the world—expanding business and technology-wise over the course of the coming decade?

CX: A decade is too short for this coming AI era, it may need to be counted by century or at least, half a century.

  • On the good side, AI and automation will improve the overall social work efficiency to such an unprecedented level, that for the first time in human history, we could produce abundant living material for everyone on this planet, but at the cost of taking hundreds of jobs away from these people.
  • On the bad side, the quick evolution of AI will make the gap wider and wider between tech strong countries and developing countries, also between tech-savvy people and people who are not.
  • On the unknown side, we may not know what the above conflict may bring to the current global and social structure of each country.

I don’t think the business of China, or any other part of the world, or the on-going conflicts between them really matters, there are common problems that all of us need to face, probably in the next-generation, if not sooner, we may have the chance to witness the dramatic global and social change for ourselves.

MM: What are your ultimate goals for the future and is there anything else that you would like to mention?

CX:  In the next 10-15 years, the industries will see an accelerating deployment of AI-enabled machines and devices, both in the B2B and B2C industries. Our goal is to integrate ourselves into this huge industrial trend, by contributing the value of our expertise on hardware. As long as we are a part of it, I believe there will be a good return, both on finances and on a sense of achievement.