China has been encouraging its college graduates to consider opening their own businesses as an alternative career option. The Ministry of Education has released a report into potential entrepreneurs and what challenges they may face. Zhong Shi joins me in the studio with more details.
Q1. I understand that the report concludes that nearly 3 percent of all graduates in 2015 have started business of some kind. What more can you tell us?
Zhong: That’s right. This report has surveyed over 200,000 graduates in 2015 and has produced some interesting facts. Like you said earlier, close to 3 percent of all graduates have become entrepreneurs, starting a business of some kind. The report shows that men are more inclined to do it. 3.6% of guys and just over 2% of girls have chosen to be entrepreneurs. In terms of college programs, those who study Arts, Engineering and Management are more likely to start their own business. As for the reasons behind their choice. Almost 20% say they’re motivated by friends who have shown determination. Another nearly 19% say entrepreneurship has always been their personal goal. About 13% cite family support as the major reason. They may also find confidence and inspiration from a number of cases in China where college graduates-turned-entrepreneurs have achieved remarkable success.
Authentic ingredients and a stream of willing customers. Business is booming at this rice noodle business in Beijing.
The brains behind the restaurant chain is 25 year old Zhang Tianyi. It’s hard to believe he started his business using only 100 thousand yuan after graduation. In just one year, Zhang has opened 5 stores and has a growing number of regular customers. But success, he says, came only through trial and error.
“It’s so difficult to start a business. You could feel honored, uncertain or even humiliated during a short period of time. I think these life experiences are very necessary for a young man in his twenties, just like me. Even if the business failed, you closed down a company in your twenties, I think all these experiences will help you think clearer and become better in the future,” Zhang said.
23 year old Zhuang Chenyangin Jiangsu has a similarly inspiring story. He gave up a comfortable job in Shanghai after graduation, and built up his plant business in this green house, which now produces nearly half a million yuan of crops every year.
But Zhuang says his entrepreneurial endeavour has not been without its ups and downs, due to his lack of experience in plant cultivation.
“Because of the properties of succulent plants, if you use the wrong pesticide, it won’t kill the worms but will hurt the plant. In the beginning, I tried six or seven pesticides before I finally got the right one, which caused the death of many plants. This costs me tens of thousands of yuan,” Zhuang said.
To minimize risks and provide support for beginner entrepreneurs, Peking University has launched a training camp for budding business brains.
There’s hundreds of courses on offer as well as face to face exchanges with experienced coaches and there’s even abundant financial support for stand out projects.
“A bunch of outstanding entrepreneurs from Peking University make up our supporting investment group, and become the Angel investors. They not only give lectures, but also provide financial support to our projects for college students. We have 8 bases and over 20 course centers all over the country, together with hundreds of online live classrooms, which benefit 200 to 300 thousands young entrepreneurs every year,” Wang Jian, dean of Peking Univ.’s Entrepreneur Training Camp, said.
The training camp is now free to college graduates from all over China, providing not only guidance, but a future for more and more aspiring young entrepreneurs.
Q2. Talk to us about the challenges college graduates might face if they choose to start their own business, and if authorities and schools stand ready to lend a hand.
Zhong: This call for an alternative career path comes amid ever-growing competition in the job market for those fresh out-of-schools. China’s colleges have turned out more graduates each year. The number of graduates has been rising 3 years in a row. However, are graduates prepared for this career option? The report shows that less than 7% of all graduates-turned-entrepreneurs have had systematic training for starting a business. They face problems like a lack of experience and insufficient team work. What they say they need the most are start-up funds, small loans and tax reductions. The government does have an Entrepreneurship Guidance Plan in place, that says multiple ministries will cooperate to offer assistance to graduates, including project introduction, risk evaluation and loan support. It’s estimated that 800,000 graduates will have benefited from these measures by the end of 2017. Meantime, established entrepreneurs urge caution to those young and green would-be start-ups. Starting a business may not be for everyone. So choose wisely.