Huge market is challenging, but it's where the opportunities are.
Sometimes, numbers can be meaningless. No doubt there are 1.3 billion people in China, but the number is so big it's hard to mentally grasp what it really means.
But when Nathan Donaldson talks about visiting a business incubator in Shanghai, the immensity of Chinese business becomes understandable.
Having visited more than a few New Zealand incubators, Donaldson expected a larger-sized version of the cubbyholes and dozen or so staff he'd expect to see back home.
Instead, he was confronted with two 29-storey tower blocks. In one tower, each floor was divided into spaces for several businesses; in the other tower, the start-ups had a floor each. China was much bigger than he realised.
Donaldson is founder and managing director of Boost New Media, a Wellington web development company that has become a "business process coach" and has just opened its second office - not in Auckland or Australia but in Shanghai, a gutsy move for a small business looking for a bigger market.
"We looked at Melbourne - I didn't look at Auckland because I don't think it's a big enough market for us to make the most of the effort we'd have to put in," Donaldson explains.
While Melbourne had decent surf in its favour, Donaldson had just recruited Jacob Creech, son of former MP Wyatt Creech, who is fluent in Mandarin and had worked and studied in China.
"I've been working closely with Jake and he made it clear that he thought there was a huge opportunity in China," he says. "As soon as we started to compare the opportunity in Shanghai and the opportunity in Melbourne, I mean ... Shanghai has 24 million people."
It helped that Donaldson's research in China revealed only four other practitioners of the business practice, "Agile", which is essentially what the company is selling.
What is Agile, or its related training system, "Scrum"? "Some people think that Agile is really about a set of airy-fairy Californian ideals but it's actually pragmatic - what can we do more of to be successful."
The Agile manifesto is a set of values that includes such bon mots as: "Individuals and interactions are valued more than processes and tools."
"We do Scrum coaching or Agile coaching and we help organisations transform from where they are today to being Agile organisations and that's a combination of training, mentoring and coaching," he continues. "If you embrace [Agile values], you're more likely to have a successful outcome from a project.
"It's not rocket science."
Indeed it is not and Donaldson is right, it does sound a bit airy-fairy. Until he explains that Agile is used by more than 60 per cent of projects in Silicon Valley, and 75 per cent of those would use Scrum (Boost's area of expertise) or combination of Scrum and XP, a related Agile methodology.
"Agile is becoming the predominant way to make software," he says.
"We've become very good at helping people understand and use Scrum and we decided to take that to Shanghai."
Stripping away the jargon, it seems to be a system where hierarchy, the curse of vertically integrated large corporates, is deconstructed and all staff empowered to decide and act in the business' best interests.
"We see this as a pragmatic way of delivering more value more quickly to businesses," is Donaldson's response when asked for a plain English version. "It's not just at the executive level; it's for everybody, from the developers to the teams and to management as well."
Of course, setting up in China is not easy. You have to sign a one-year lease on a building before even applying for a licence to practise business - "it sounds a bit risky from a New Zealand perspective". They chose their building carefully as the district a business settles in dictates how much registered capital must be held. The premises cost $2000 a sq m.
"The day Jake spent at the bank trying to get money transferred, the bank's accountant and the teller sat down and walked him through how to do tax fraud in China," he recalls.
The licence for a "wholly owned foreign enterprise" took six months to acquire and the company was quoted sums ranging from US$300 ($377), from an individual whose cousin was in government, to US$25,000 from a law firm.
"We went with someone in the middle," says Donaldson.
They've been on the ground for four months and have two clients, both of them are start-ups and both are facing "thorny problems: one of the start-ups has a team that's distributed between Shanghai and Poland and the other one's distributed between a place three hours out of Shanghai and the States".
The deal is to inculcate Agile values - "they have found it life-changing" - at a reduced price and in return, the companies will help Boost Agile build market credibility in Shanghai.
"Now," he says, "we're starting to talk with the multinationals."By Nick Smith