Globalization's "Shadow Companies" | WAVES New Wave 2025
WAVES New Wave 2025 invites you to embrace the "New Era" of China's venture capital and investment.
This is the new era of China's venture capital and investment. Currently, the Chinese venture capital market is not only at the turning point of the market cycle bottoming out but also in the deepening period of structural transformation. In the new ecosystem dominated by policies and with high concentration of state - owned capital and private capital, only by following the trend and making flexible adjustments can we seize certain opportunities amidst uncertainties.
From June 11th to 12th, at the Liangzhu Culture and Art Center in Hangzhou, the 36Kr WAVES New Wave 2025 Conference, themed "New Era", will gather top investors in the venture capital field, founders of cutting - edge enterprises, as well as scientists, creators, and scholars deeply involved in technology, innovation, and business. They will jointly discuss frontier issues such as AI technological innovation, the wave of globalization, and value re - evaluation, dissect their visions of business ideals and the future world, and together explore, seek, and embrace the "New Era" of China's venture capital and investment.
On the afternoon of June 12th, a round - table dialogue titled "Global 'Shadow Companies'" was held in the investors' venue. Lucy Liu, Co - founder and President of Airwallex; Wenli Gao, Co - founder of iMile; Yunyun Mao, Vice President of Fanding International; Songyang Gao, Vice President and Co - founder of WanYitong Group; and Xiaoan Shen, Head of Greater China Partnerships at Deel participated in this round - table, which was hosted by Qian Ren, a senior writer at AnYong Waves.
The scene of the round - table
Qian Ren: Finally, we've reached the grand finale panel. It's noon now, but please be patient. I believe you'll find the titles of the guests on stage very impressive, and I'm sure you'll gain a lot from this session. Why did we organize a panel on global shadow companies at this conference? During the exploration of the globalization wave, we've found that in the past decade or so, many intermediary companies have grown significantly, yet the outside world knows little about them. Some companies have revenues in the billions of US dollars, and some are on the verge of going public. We're very fortunate to have invited all the bosses here today. First, please introduce yourselves and the companies you represent. They cover various fields such as cross - border payment, logistics, overseas warehouses, and overseas employment. Let's start with Lucy.
Lucy Liu: Hello, everyone. I'm Lucy, a co - founder of Airwallex. Our company was established in 2015. We are a global fintech enterprise. We've built a team of over 1,700 people across 26 office locations worldwide, serving more than 150,000 small, medium, and large enterprises. Our business basically covers the entire cross - border payment chain, including some accounting, banking, and cash management products and services.
Wenli Gao: Hello, everyone. I'm Wenli Gao from iMile. We are an overseas express delivery company serving e - commerce. We started in the Middle East in 2017, entered Latin America in 2012, and expanded into Europe and Australia last year (2024). Just remember that I'm in the express delivery business. Thank you.
Yunyun Mao: Hello, I'm Yunyun Mao from Fanding International. We are a service provider focusing on providing comprehensive foreign trade services for China's advanced high - end manufacturing industry. Our business mainly includes trunk transportation, overseas warehouse operation, last - mile delivery, logistics and warehousing distribution for small and medium - sized end - users, and providing full - chain supply - chain distribution services for our customers. We started in Europe and the United States, entered the Southeast Asian market last year, and are entering the Brazilian and Middle Eastern markets this year. We mainly focus on core large platforms and major industries, which not only include well - known cross - border e - commerce but also the overseas expansion of high - end manufacturing industries representing China's advanced productivity, such as BYD, CATL, JA Solar, Sungrow, etc.
Songyang Gao: Hello, I'm Songyang Gao from WanYitong. WanYitong was established in 2012. We mainly provide full - scenario and efficient overseas warehouse services for sellers. We now have fully automated overseas warehouses in the United States, the United Kingdom, Germany, Australia, and Canada. We are committed to helping cross - border e - commerce enterprises build world - class supply chains through intelligent technology and logistics. Our core is to help sellers achieve three things: sell better, stock less, and reduce overall costs. This is our core value.
Xiaoan Shen: Hello, I'm Xiaoan Shen, responsible for Deel's partnership business in Greater China. Deel is a platform that uses SaaS to solve overseas employment and overseas payroll issues. Our company has been established for six years and has grown rapidly globally. Our team in China has been around for almost three years. We are now serving many Chinese enterprises, helping them find solutions for overseas employment compliance. I look forward to communicating and cooperating with you all.
Qian Ren: I have a broad question first. The founding years of each company are quite worth studying. Fanding International and WanYitong were founded around 2013 and 2012, along with the development of China's supply chain 1.0 era and cross - border sellers. iMile and Airwallex were founded around 2015 and 2017, showing a trend of in - depth localization. Deel was founded in 2018, representing a new force in global distributed office employment. I wonder how you view the opportunities brought by the globalization wave in your respective industries over the years, and whether there have been any business changes in your companies to adapt to these variables?
Lucy Liu: From Airwallex's perspective, we emerged at a time when not only Chinese enterprises but also global enterprises had a strong demand for digitalization and globalization from the very beginning. At that time, whether it was C - end payment or the supply chain, they had developed rapidly. For traditional enterprises going global, we went through the Internet era, the mobile Internet era, and then the cloud - computing era. However, in the field of fintech, it still remained in a very traditional model, mainly dominated by banks, providing offline or fragmented systems. But in China, represented by payment, we already had real - time payment, QR code payment, and products with better user experiences.
In the B - end, you can imagine that 10 years ago, it was still mainly counter services like using checks and faxes. So the first thing we did when founding the company was to digitize all our work. Our first wave of fast - growing customers were in the small - value and high - frequency payment scenario. Under the traditional Swift system, the handling fee for each transaction was at least $50 or even higher, the entire payment process was very opaque, refunds were very slow, and for non - mainstream currencies or countries, it could even take half a month or longer. When there was a need for more cost - effective and rapid cash management and distribution in different countries, traditional banks could no longer meet these requirements. So in the first three years of our company's establishment, the only thing we did was to connect the payment links in different regions and turn cross - border payments into a simple local payment process.
Later, with product iterations and changing needs, we expanded into card payment, card acceptance, wallet payment, and wallet acceptance. Now we are also involved in many cross - border scenario - based services, such as business travel services, which are all tailored to our customers' needs and our company's development requirements. I think whether it's a new company or a company undergoing transformation, its needs are completely different from those served by traditional banks. That's why we've maintained a 100% growth rate in the past decade, and by March this year, our annual transaction volume had reached $130 billion.
Wenli Gao: Looking at the past eight years, the essence of our business facing commercial flows is the change in commercial flows. One is the transformation from traditional goods trade to e - commerce trade, and the other is the shift from offline to online. The changes in commercial flows have driven rapid changes in the last - mile delivery field.
However, in the past three or four years, there have been two main impacts on us. First, the cross - border commercial flow has accelerated its shift from Europe and the United States to emerging markets. Since we focus on emerging markets, especially after the pandemic in 2021, the challenges in terms of production capacity and quality have been increasing.
Second, since 2018, due to the global trade war, there has been a high degree of uncertainty in the geopolitics and national policies of different regions, especially in terms of tariffs and value - added taxes. This has led to the cross - border commercial flow moving towards the front end of the supply chain and even regional circulation, posing challenges to our network construction.
Yunyun Mao: Fanding International was founded in 2013. At that time, when Chinese enterprises participated in international trade, it was called cross - border trade rather than "going global". There was a boom in overseas shopping, and many excellent enterprises emerged, including listed and non - listed companies like Miya and Jumei Youpin. At that time, the core of Fanding International was to "buy the world", bringing high - quality global products into China through our logistics and supply - chain system.
In the following years, since China joined the WTO, Chinese enterprises have gradually shifted from simple product exports to brand expansion overseas. From our company's perspective, we believe that there are several core indicators to define whether a company has truly "gone global". First, it has pricing power overseas; second, it can reach a more in - depth sales system overseas. This is what we consider to be the real meaning of "going global" for both large enterprises and sellers. We are very fortunate to be in this great era. We often tell our team and investors that going global will be the "beta of the decades" in the future. It is a major trend that cannot be ignored in the long run. It is no longer an undercurrent but a visible wave.
Following Mr. Gao's speech, from our observation, the rapid development of cross - border e - commerce due to the pandemic has brought about a disruptive change in the global supply - chain system. It has made the original hierarchical sales system more decentralized, which poses higher requirements for us to better serve Chinese sellers or enterprises. We need to expand our business not only in the main trunk lines but also in the local "capillaries" of each country, including our warehousing network, distribution system, express delivery, and freight services. Fanding International's specialty is to connect the local sales system through our logistics and supply - chain system. These are the things we have observed.
An interesting thing our investor said is that in this era, our national fortune is to embrace uncertainty. There will definitely be trade frictions. It is precisely because of these frictions and challenges that we are forced to improve ourselves, stand out from the competition, become better enterprises, and better serve our customers, thus contributing to Chinese enterprises' global expansion. Thank you.
Songyang Gao: WanYitong entered the overseas warehouse industry relatively early. Since its establishment in 2012, we have witnessed the rapid development of cross - border e - commerce. In the early days of the cross - border e - commerce 1.0 era, products worth 10 yuan in China were sold for $10 overseas. At that time, for sellers, the most important thing about overseas warehouse services was just to be able to deliver the goods to buyers.
Then came the cross - border e - commerce 2.0 era, when the competition became more homogeneous. Sellers needed to pay more attention to product quality and service, which was reflected in the trend of high - quality and vertical - oriented products. For overseas warehouses, we needed to meet and even exceed the platform's service - quality requirements to ensure account stability and increase sales. At that time, WanYitong decisively invested heavily in warehouse automation to ensure service stability and accuracy. We were the first company outside of Amazon to build automated overseas warehouses in the overseas market. A single warehouse could cover an area of about 50,000 square meters, and the investment was about 300 - 500 million yuan. We were very determined. During the pandemic, our fully automated warehouses significantly reduced our reliance on labor, helping sellers operate and sell more stably and efficiently.
Now we believe we have entered the cross - border e - commerce 3.0 era, with the wave of Chinese brands going global. Through cross - border e - commerce sales, Chinese brands can truly break free from the control of traditional supply - chain channel providers and retailers. Many brands have now set up independent websites, aiming to capture consumers' minds and generate repeat purchases through brand building. Some brand sellers are also establishing direct contact with customers through offline stores, truly competing with overseas local brands. It is particularly important for WanYitong to help brands improve their supply - chain management capabilities. For example, we optimize warehouses and build a warehouse network to speed up delivery and reduce overall costs; we integrate 2B and 2C services to help sellers fulfill orders on both online e - commerce platforms and for offline distributors, stores, and supermarkets; we even help sellers add gift boxes, include marketing materials, and handle returns. Helping brand sellers go global and compete with overseas local brands is an inevitable trend in the future development of cross - border e - commerce, and it is also where we need to optimize and improve.
Xiaoan Shen: I think in the field of overseas employment, our company Deel was founded in 2018. If you pay attention to the founding year, it's a very interesting phenomenon. There are two major variables. The first is the pandemic in 2020, which promoted remote work and forced many enterprises to try this model. The second major variable is the rapid development of AI and its wide application in our overseas employment field. Traditionally, the biggest challenge in overseas employment is that entrepreneurs only want to have employees overseas to complete local work. However, to recruit employees, provide benefits, and pay salaries, they need to connect with multiple suppliers in overseas countries. Due to the fragmentation of knowledge and compliance requirements, the process of connecting with suppliers is very labor - intensive. So, under such great challenges, Deel was founded with the original intention of simplifying a series of basic enterprise needs in multiple overseas countries in one - stop service. This is a major premise for Deel's birth.
During the pandemic, including my own experience of remote work, the pandemic has greatly promoted the growth of Deel's remote - work business, and our customer base has also grown rapidly in recent years. Currently, the major variable is AI. Why is it AI? When you go to different overseas destinations, the labor laws and compliance requirements in each country are very different. Once you have employees in a country, the compliance situation will change and is not static. So, in this process, the application of AI plays a very important role in helping us monitor and manage dynamic compliance solutions in real - time. Internally at Deel, it is impossible for any single employee to know the labor laws of the more than 120 countries we cover. But with the application of AI, each employee's knowledge base can be greatly expanded. In a sense, it also greatly facilitates the training of employees with relatively complex work.
Qian Ren: Thank you. Now I have a question for each of you. I hope to hear more of your sharing. First, cross - border payment is considered a huge opportunity, even an underestimated one. I think the real take - off of cross - border payment business was around 2021, when you completed several important links in the transaction chain and gained access to many global markets. I'd like to hear from Lucy. What do you think are the crucial links in the cross - border payment chain? What pain points did you encounter in solving these problems? And what kind of companies do you think can stand out in this environment?
Lucy Liu: I think it can be divided into several aspects. Even now, our company is still improving our underlying infrastructure. By infrastructure, I mean our core licensing capabilities in each country. Currently, we have about 60 different payment - related licenses in various countries and regions around the world. On this basis, there are basic application - level services. At the beginning, we focused on distribution, small - value multi - currency scenarios, API services, and helping customers with foreign - exchange settlement and payments.
Since 2019, we have launched two products each year, one for card payment and the other for card acceptance, to improve our payment scenarios beyond the traditional bank - account system, covering both wallet and card - payment ends. So far, we have established a very complete payment chain from the inflow to the outflow of funds. Then we started to consider what else our customers need, because the inflow and outflow of funds are just the first step. First, we have a multi - currency account system. We have integrated 10 different currencies into one account. In this way, we have basically connected the entire end - to - end payment process. After that, we started to look at what else enterprises need, such as expense control, risk management, and compliance. Payment compliance in different countries is a very complex issue.
Traditionally, cross - border e - commerce, the travel industry, and companies are considered to be the main users of cross - border payment. However, it's not limited to these. Later, we cooperated with Deel globally. For example, payroll and digital enterprises like SaaS or AI platforms need more innovation