AI Superpowers: China, Silicon Valley, and the New World Order

by Kai-Fu Lee

Combine these three currents—a cultural acceptance of copying, a scarcity mentality, and the willingness to dive into any promising new industry—and you have the psychological foundations of China’s internet ecosystem.

Battles with Silicon Valley may have created some of China’s homegrown internet Goliaths, but it was cutthroat Chinese domestic competition that forged a generation of gladiator entrepreneurs.

That methodology was first explicitly formulated in Silicon Valley and popularized by the 2011 book The Lean Startup. Core to its philosophy is the idea that founders don’t know what product the market needs—the market knows what product the market needs. Instead of spending years and millions of dollars secretly creating their idea of the perfect product, startups should move quickly to release a “minimum viable product” that can tease out market demand for different functions. Internet-based startups can then receive instant feedback based on customer activity,