Why does Shenzhen always nurture unicorn companies?

Recently, the AI note - taking hardware device Plaud launched by Shenzhen Jizhi Connect Technology Co., Ltd. has attracted global attention. There has been a lot of discussion in the industry around this product: some focus on the AI hardware track it enters, some analyze the demand for efficiency tools it represents, and some see it as another successful example of a Chinese consumer electronics brand going global.

Stepping out of the single - product perspective, the author believes that what is more worth exploring behind the popularity of Plaud is: why do such innovative enterprises emerge in Shenzhen again? From DJI, Insta360, Anker Innovations to EcoFlow, Shenzhen always seems to produce a batch of new unicorn enterprises at the intersection of new technologies and new demands.

If we simply attribute the success of such enterprises to individual opportunities, it obviously underestimates the depth of the problem. The continuous emergence of unicorn enterprises in Shenzhen is actually the result of the continuous operation of the innovation ecosystem. Shenzhen has explored an innovation paradigm worthy of serious summary.

01 Creating the Future

The unicorn enterprises in Shenzhen did not emerge suddenly. A group of native technology enterprises growing around smart hardware, robots, energy storage devices, and AI terminals are continuously emerging in China, especially in Shenzhen.

Most of these enterprises have the following characteristics: clear product definition ability, strong hardware - software integration ability, rapid engineering implementation ability, awareness of the global market, and the organizational ability to transform complex technologies into stable products.

There may be accidental factors behind the success of a single enterprise. However, it is by no means accidental that a city can continuously produce a group of enterprises with similar characteristics. There must be in - depth empowerment from a well - developed industrial ecosystem behind it.

When it comes to Shenzhen's industrial strength, many people first think of its complete supply chain. Shenzhen has an extremely high density of the electronic information industry chain in the world. From chips, modules, sensors, structural components, batteries, displays, to industrial design, rapid prototyping, small - batch trial production, complete machine assembly, testing and certification, and cross - border logistics, almost all key links can quickly find cooperation partners within a short distance. This completeness and response speed are difficult to match in many other places.

However, we cannot simply understand Shenzhen's advantage as "a complete supply chain". The valuable thing about this city is that the supply chain has become more than just a static resource. It has become part of the innovation activities and an integral part of product definition, engineering verification, and commercial implementation.

What makes Shenzhen remarkable is its ability to quickly turn an idea into a product, a concept into a trial production, a trial production into large - scale production, and test an immature technological idea in the real market in the shortest possible time. Shenzhen's supply chain functions as an innovation infrastructure, deeply participating in innovation rather than just being an execution link after innovation.

Many places have industrial parks, factories, and investment promotion, but they fail to replicate Shenzhen's uniqueness: highly integrating the industrial chain, engineers, entrepreneurs, the OEM system, market feedback, and global channels into an urban mechanism. Entrepreneurial teams can quickly complete the entire cycle from product definition to engineering implementation, from design modification to market trial - and - error in Shenzhen.

This is crucial for the early growth of unicorn enterprises. What new enterprises often lack in the early stage is not the vision, but the ability to turn the vision into reality. The importance of Shenzhen lies not in enabling enterprises to have grander ideas, but in enabling them to quickly turn their ideas into reality and continue to expand after that.

Today, Shenzhen's industrial advantages have gone beyond "having an industrial chain", "having factories", and "having exports". It has formed a system that can continuously spawn new enterprises, new products, and new brands. Local enterprises are actually forged quickly in an urban ecosystem with high density, high responsiveness, high synergy, and high competition.

02 Manufacturing - Driven Innovation

Interpreting Shenzhen's innovation model should not be limited to the level of urban competition. When examined from the global innovation landscape, we will find that what makes Shenzhen worthy of summary is precisely its difference from Silicon Valley.

For a long time, when people talk about technological innovation, they often think of Silicon Valley in the United States first, think of university laboratories, venture capital, and breakthroughs in underlying technologies, and default that innovation can only follow the path of "from 0 to 1" in original breakthroughs.

After World War II, starting from Vannevar Bush's "Science: The Endless Frontier", the United States gradually formed an innovation logic with basic scientific research as the source, technological breakthroughs as the driving force, and the capital system as the amplifier.

This model has enabled the United States to maintain its leading position in science and technology in the past few decades and established Silicon Valley as the global innovation mecca. It represents a typical "science - technology - industry" path, a "from 0 to 1" breakthrough, constantly expanding the frontiers of knowledge.

Shenzhen's growth logic is completely different. Shenzhen also has technological innovation, R & D investment, and an increasing number of high - level enterprises. However, its most prominent feature is to prioritize manufacturing, engineering, products, and market verification, and it has developed a characteristic path of "manufacturing - engineering - product - industry".

Many innovations in Shenzhen do not start with a major academic breakthrough and then gradually enter the market. Instead, after enterprises discover scenarios, demands, or opportunity windows, they quickly mobilize technologies, components, design, manufacturing, and services to create products and then iterate rapidly in the market, achieving a leap from "1 to 100".

Many years ago, the author once met a scholar from the MIT Sloan School of Management. He put forward such an idea at that time: the United States is very strong in "0 to 1" scientific research innovation, but when many laboratory results reach the small - scale production stage, they often encounter the problem of the disconnection between the innovation chain and the industrial chain. If such innovations are carried out in Shenzhen or the Pearl River Delta for trial production and large - scale production, and then decisions are made to sell in China or return to the United States for further development based on market feedback, a new innovation synergy mechanism may be formed.

Behind this idea lies a judgment: although original innovation is important, turning innovation into reality cannot be separated from the long, difficult, and complex industrial implementation process outside the laboratory. This is precisely where the advantages of Shenzhen and the Pearl River Delta lie.

If Silicon Valley solves the problem of "whether it can be invented", Shenzhen is better at solving the problems of "whether it can be made and whether it can be scaled up after being made". The former determines the boundaries of knowledge and excels in invention; the latter determines the boundaries of the industry and excels in implementation.

There is no superiority or inferiority between the two innovation models. However, for a long time, the public has habitually equated "innovation" narrowly with the Silicon Valley - style path, as if only breakthroughs in underlying principles and original inventions can be regarded as innovation. This understanding and perception clearly cannot keep up with the current reality of industrial development. The reality is increasingly telling us that whoever can turn technology into products, products into systems, and systems into brands and ecosystems can also define the world.

Therefore, it is necessary for us to revise the traditional "smiling curve" - R & D, brand, and market are at both ends of the value chain with high added value, while manufacturing is in the middle with low added value. This theory has had explanatory power for a long time and has influenced many people's understanding of industrial upgrading. When many places talk about transformation and upgrading, they often first think of "de - manufacturing", as if the farther away from manufacturing, the closer to the high - end.

However, this logic can no longer explain Shenzhen today.

Today's manufacturing has evolved into a highly complex process of engineering implementation, system integration, rapid iteration, and reliability verification. It is a process of balancing cost, quality, efficiency, and delivery, and itself contains a large amount of innovation.

Especially in the fields of smart hardware, robots, energy storage devices, and AI terminals, the key to an enterprise's success does not lie in the initial technological concept, but in who can turn the technology into a stable product that can be replicated, delivered, scaled up, and globalized. Without manufacturing, technology can only stay in the laboratory; without engineering capabilities, concepts cannot be transformed into industries; without supply - chain synergy, products cannot form competitiveness.

In the competition of the new - generation science and technology industry, manufacturing has risen from an execution link at the bottom of the value chain to a key implementation link in the innovation chain. Capital, the market, and talents can flow, but a high - density supply chain and a manufacturing synergy system are not easy to move. Once the latter is formed, it will become the most irreplaceable competitiveness of a region.

This is also the reason why although DJI's initial capital may not come from Shenzhen and its earliest market may not be in Shenzhen, it finally chose to take root in Shenzhen and grow into a global enterprise. For such enterprises, funds, concepts, and slogans can be obtained across regions, but the innovation implementation ability formed by manufacturing and the supply chain is the core asset that cannot be relocated.

The value of Shenzhen lies in the formation of a manufacturing - driven innovation development model. The value of this model lies in making it easier to transform technological possibilities into industrial realities. Relying on the manufacturing system, engineer groups, supply - chain network, rapid prototyping ability, and market feedback mechanism, they jointly build the foundation for the city's innovation activities.

This is also a node that Chinese manufacturing must seriously sort out at present. In the past, in theory and narrative, we often preferred to talk about "technological innovation", and our understanding of "manufacturing - driven innovation" was still insufficient. Even in many cases, we regarded manufacturing as the recipient of innovation rather than the place where innovation occurs.

Shenzhen's industrial practice has proved that manufacturing can not only undertake the implementation of cutting - edge technologies but also organize, promote, and reshape the application methods of technologies, representing a new direction for Chinese manufacturing after it has developed to a new stage.

03 More Than One "Silicon Valley"

If the United States defined an era with "Science: The Endless Frontier", Shenzhen is proving that the ability to "realize the frontier" is equally important. The "frontier" includes not only the knowledge boundaries in the laboratory but also the engineering boundaries in the factory, the efficiency boundaries in the production line, the synergy boundaries in the supply chain, and the experience boundaries in the product. The era value of Chinese - style innovation lies in expanding our understanding of "innovation".

Deep down, high - tech has often meant high thresholds in the past, meaning that a few countries, a few institutions, and a few capital centers have the dominant power in innovation. When technology can be more widely transformed into products and capabilities through the manufacturing system, supply - chain system, and engineering system, innovation is no longer just a game for a few people. More enterprises, cities, and even ordinary engineers have the opportunity to participate in, realize, and share innovation. This is not only an economic expansion but also a development - oriented expansion.

The Shenzhen model shows us that Chinese innovation does not have to follow the Silicon Valley path completely and does not have to wait for every link to replicate the United States before being qualified to talk about innovation. China can form a new innovation logic based on its own industrial foundation, urban structure, engineer dividend, and super - large - scale market to promote enterprise growth and industrial upgrading.

Of course, Shenzhen is not the only answer to Chinese innovation. China has a vast territory, and cities vary significantly in industrial foundation, regional culture, and development genes, forming a diversified innovation and development pattern. China cannot simply copy Silicon Valley, and there will not be only one Shenzhen. In the future, a batch of urban innovation models with different paths and distinct characteristics will emerge. For example, Hangzhou's innovation is more inclined to platform economy, digital economy, algorithm ecosystem, the vitality of private enterprises, and the logic of consumer Internet; Chengdu is more likely to form characteristics in scientific research resources, cultural temperament, the attractiveness of lifestyle, new consumption, and new cultural and creative industries.

The Shenzhen model just confirms that there is no fixed template for the innovation ecosystem. Each city can build its own unique innovation structure based on its industrial foundation, regional culture, geographical conditions, and policy environment. Shenzhen has only practiced and verified that manufacturing - driven, engineering - driven, and market - driven innovation can also produce unicorns and world - class enterprises. This opens up an imaginative space for China's overall innovation map.

The continuous emergence of unicorn enterprises in Shenzhen is a signal of the times: after years of accumulation, Chinese manufacturing is moving from production capacity to innovation implementation ability, from "being able to produce" to "being able to define", and from "the world's factory" to "an important source of world - class innovative products and brands".

This article is from the WeChat official account Economic Observer. Author: Xie Hong. Republished by 36Kr with authorization.