Cafe helps startups get started

Potential fills the room at cafe Garage, an incubator for enterprises. Feng Yongbin / China Daily

Located in China's technology hub Zhongguancun, more than 140 young companies use Garage Cafe as a place to grow their businesses and meet investors.

In 2010, Shen Mengmin quit his job selling extractors to construction companies in southern China and moved to Beijing with the dream of starting his own business.He sleeps in a $4-a-night bed in a bath center in Zhongguancun.

He eats only one meal a day - the free breakfast that comes with the bed. Every day after breakfast, Shen rushes to a cafe near the bath center.

The cafe is hard to find. It's located above a cheap hotel, on the second floor of an old building.

Its green-and-white sign looks small and plain, compared to the rows of signs for discount bookstores and clothes shops.

The cafe's decorations are simple; it has a bar and dozens of large tables. Most of its customers are men, which isn't that unusual when you consider the cafe's location: Zhongguancun.

More than 170,000 people - mostly men - work in the information technology hub's 4,000 companies.

Shen walks quickly to a table and sets up his laptop. Through the cafe, he has met people who specialize in app design, and together they have designed an app that serves as a market for secondhand excavators. He often comes to the cafe to discuss his app with investors.

Garage Cafe was founded by Su Di, a former employee of an investment company.

He spent years traversing Beijing's notorious traffic, looking for enterprising people whose projects needed money from his company.

Then he came up with the idea of opening a cafe where entrepreneurs and investors can come together.

Pitching their ideas

The cafe opened in 2011. Last year, around 1,500 startup teams came there to pitch their projects to investors, according to the cafe's CEO, Jin Zisen. Some left with money, and a few have become highly successful.

Garage Cafe made headlines in December when it was visited by Lu Wei, minister of the Cyberspace Administration of China. He reportedly later spoke highly of the cafe during a trip to the United States.

Jin says the cafe is called "Garage" because companies like Hewlett-Packard and Apple originated in a simple garage.

Every day at noon, there's a 30-minute session at the cafe in which customers are encouraged to sell their business ideas to the public, and discuss their projects.

Established enterprising executives and investors give speeches at the cafe, mostly about the Internet business, and brainstorming sessions are held every Friday for people to share and evaluate each other's business ideas and models.

The cafe provides free Internet access. The only expenses are for food and drinks. A cup of coffee sells for less than 20 yuan ($3.23). About 30 to 40 percent of the cafe's customers work long hours in the cafe, as if it were their office, says Jin.

Liu Yahui, 25, from Central China's Henan province, comes to the cafe every day. Liu, who graduated from an occupational school in Henan province, began coming to the cafe as early as 2012, when he worked in Beijing as an intern.

"Garage cafe was already famous at the time. I was interested in starting my own business, so I came to Garage Cafe quite often and made lots of friends," Liu says.

In July, Liu quit his job at an online store to run a social media platform for startups with three other young people, who were all born in the 1980s or 1990s.

They try to pair experienced Internet technology engineers, financial, marketing and operational professionals with startups.

Plan for success

Despite not having enough employees and capital, Liu is confident their business will succeed. He uses a table in the cafe as his workspace, and even plans to register it as his company's address, if they cannot afford rent for a physical office.

Liu feels confident, as he is surrounded by other people who are passionate about starting a business and works at a place where he can directly promote his project to investors.

More than 140 startup teams have been formed in the cafe, and about 70 startups received funding with the help of the cafe, according to Jin.

Around 147 startups use the cafe as an office, and four of them are estimated to be worth more than 100 million yuan each.

Liu Zhixiong, CEO of Haogougou, a successful social networking platform that helps dog owners find grooming services for their pets, first came to the cafe in 2011 and met his investor there.

Haogougou receives hundreds of orders every day and is growing steadily.

Liu has moved his company into an office building in downtown, yet he still comes to Garage Cafe regularly.

Cafe 'a second home'

Sometimes, he meets with vendors and business partners at the cafe. "The cafe feels like another home to me," Liu Zhixiong said. "To create a startup is like riding a roller coaster. It can be very lonely when one struggles to overcome obstacles.

"We need support both financially and mentally."

"The cafe gathers startup entrepreneurs, where we can meet, talk, and help each other out. We feel less lonely and more confident when we are around other people similar to us."

Liu has noticed that more people from outside Beijing are coming to the cafe. "The dream of having one's own startup is sweeping the whole country," says Jin, the cafe's CEO.

"Our cafe doesn't judge people's business ideas.

"We applaud entrepreneurship. It is great that more people are choosing to establish startups over a stable job, to do what they really enjoy," he says.

"Our educational system used to focus on how to enroll students into universities with high scores, and never bothered to encourage students to think about what they want to do with their lives. It is time to change."

Compared to 2011, when the cafe first opened, it's much easier now for startups to find investors, Jin says. The cafe is shifting its focus to help startup entrepreneurs hook up with partners and staff.

The cafe's latest news is that Shen's excavator-selling app just received an investment of 1.5 million yuan. Shen is finally moving out of the bath center.

Contact the writer at liuzhihua@chinadaily.com.cn