This commentary first appeared in CNA and was written by Jianggan Li. Republished with permission. You can access the other commentaries from Jianggan Li on CNA as well. 


SINGAPORE: LinkedIn has become one of the latest casualties among Western tech companies operating in China. In May, the professional networking site announced that it will shut down its app in China and eliminate 716 jobs globally. 

It was only a matter of time. In 2020, LinkedIn shut down its social network in China, citing a “significantly more challenging operating environment”. Fewer people were using LinkedIn in China compared to competitors such as Maimai and Boss Zhipin, which are more attuned to what Chinese jobseekers want.

LinkedIn’s story is not atypical for foreign tech giants in China’s fiercely competitive market. Companies like Amazon, Uber, Yahoo, eBay, Google and Airbnb have all failed in China – one way or another.

The difficulties of Western companies setting up shops in China have come under the spotlight amid rising geopolitical tensions. In recent weeks, US venture capital firm Sequoia hived off its Chinese arm, while US consultancies from Mintz Group to Bain and Company saw offices close and employees questioned out of national security concerns.

But before heightened sensitivities around US firms operating in China, corporate leaders have made common mistakes about doing business there.



A 2019 post by Boyang Shen, who served between 2014 and 2017 as LinkedIn China’s president, is telling. He described how product managers in US headquarters were reluctant to improve the platform and complacent about its rivals.

For instance, it was not possible for users to immediately click on a new connection’s profile; the only way to find them was to remember their name and search it on the platform. Shen’s team raised a request to create a list of new contacts that users can navigate – taking a page from Chinese social tool WeChat – but the US product managers were “too lazy to copy a feature that works for a competitor”. 

On the surface, it seems that arrogance and lack of market understanding are the key reasons for LinkedIn China’s eventual demise. But these are merely symptoms of deeper issues, namely a lack of mental bandwidth at the top and the organisation’s set-up.

To succeed in a new market, thousands of decisions need to be made, products need to be continuously iterated, and sometimes complete pivots are necessary. This is especially when you are facing strong homegrown competitors led by committed founders with ready access to the best talent. 

All of these demand leaders’ attention. How much resources to dedicate to the new market, knowing that things rarely go according to the business plan? When products change or additional resources are required, how fast can you get them to the ground? When the business significantly underperforms, would you continue to invest or cut the loss?



That was the challenge that US e-commerce juggernaut Amazon faced. Amazon entered China in 2004, around the same time Alibaba launched, but exited in 2019. The market for Amazon in China was small compared to its home market in the US. 

As a company, Amazon was (and still is) logical and strong in execution. In the US, it uses sales predictions to allocate resources and inventories. The natural thing to do is to apply the same logic to China – so if it predicted sales in China were going to shrink, it would reduce inventories and logistical infrastructure to rein in cost. 

But the problem here is not the individual product managers, but the whole organisational setup. Why would product managers in the US decide on priorities for China’s market? Why not give the local manager resources to implement changes – and hold them accountable for such decisions?

Back to LinkedIn’s story. The product managers mentioned are probably not arrogant by nature – they are likely overwhelmed by the thousands of (sometimes conflicting) product requests coming from different countries while juggling core feature updates for a global product.

The more successful a company is in their home market, the more the whole organisation is moulded for the particularities of that market, and the harder it is for them to make adjustments for a different locale.

The same root causes of failure also apply to Chinese companies venturing overseas today. WeChat, part of Chinese tech giant Tencent, failed to gain traction in any other country despite significant investment. At home, Tencent has a super app ecosystem with more than 1 billion active users.



The failures of these expansion efforts hold lessons for Western and Chinese tech players venturing overseas.

A few days after LinkedIn announced its China exit, data from web traffic analysis firm StatCounter showed that Bing, a search engine owned by LinkedIn parent Microsoft, overtook Baidu in desktop search traffic to become the top in China. 

While such statistics do not capture the full picture (most searches in China are done via mobile, not desktop), it is an indication that Western tech products can succeed in China. 

Some leaders understand the importance of having the mental space to expand abroad and make drastic decisions to support it.

Zhang Yiming and Colin Huang, founders of ByteDance and Pinduoduo respectively, both quit their CEO positions to stay away from the exhausting nitty-gritty of running their China businesses. This is so they can focus on their international ventures, TikTok and Temu respectively.

Leadership will also need to pick, sustain and motivate the right people to cultivate their businesses in large foreign markets. 

Uber founder Travis Kalanick understood the challenges of China’s vast market but did not want to give up. He took the drastic approach of giving almost unlimited power to key managers in China – on operations, product and crucially, spending.

This was the reason why when Uber pulled out from China in 2016, it managed to turn a US$1 billion investment into US$8 billion worth of Didi Chuxing shares after its merger. 

The lesson here is that leadership is ultimately responsible for people, organisation and product – and the success or failure in a new expansion. While businesses hope politics will not interfere too much, real leaders will have the grit and dedication to succeed, no matter the obstacles.


Jianggan Li is CEO of Momentum Works and co-author of Seeing The Unseen: Behind Chinese Tech Giants’ Global Venturing.

Thanks for reading The Low Down (TLD), the blog by the team at Momentum Works. Got a different perspective or have a burning opinion to share? Let us know at [email protected].


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Jianggan Li is the Founder & CEO of Momentum Works. Prior to founding Momentum Works, he co-founded Easy Taxi in Asia, and served as Managing Director of Foodpanda. The two years running Rocket Internet companies has given him a lifetime experience on supersonic implementation, and good camaraderie with entrepreneurs across the developing world. He holds a MBA from INSEAD (GMAT 770) and a degree in Computer Engineering from Nanyang Technological University. Unfortunately he never wrote a single line of code professionally - but in his first job he was in media, travelling extensively across Asia & Europe, speaking with Ministers & (occasionally) Prime Ministers. Apart from English and his native Mandarin, he is also fluent in French and conversational in Cantonese & Spanish. He tried to learn Latin (for three years) and Sanskrit (for six months) as well. In his (scarce) free time, he reads, travels, hikes and dives. Pyongyang, Tehran & Chisinau are among the interesting cities he has been to.