China Internet veteran Marc van der Chijs has a thorough look at the already sorrow state of Groupon‘s effort to enter the China market, together with the domestic giant Tencent. Things go from bad to worse. After Van der Chijs describes what has happened till now, he concludes:
If I were Groupon, I would seriously reconsider their current China market entry. If they want to enter fast they need Tencent, there is no way around it. But if they give themselves a bit more time there are other ways. They made the mistake of mainly hiring foreign managers and focusing in their recruitment drive on consultants and investment bankers with MBAs. That may work in the US, but that’s not what you need to be successful in China.
The article was original written for the Silcon Valley Insider. Last night Van der Chijs wrote is last update, and things look even worse now:
Last night an article on the Marbridge Daily named the 2 managing directors for Groupon in Beijing and Shanghai. From their LinkedIn resumes (see here for Mads Faurholt and Raphael Strauch) it looks like they both got their first real jobs in 2007 and have zero operations or China experience. They seem to be very smart, ambitious and aggressive guys, which is perfect for the European or US market, but less so for cooperation with a leading Chinese Internet company.