Ashley Dudarenok | The Hidden Switch

Just spoke with the BBC. ☘️ China’s emissions and new targets? 🏭 Yes, China is the world's largest emitter, responsible for over a quarter of global greenhouse gases. But in a landmark move yesterday, President Xi announced China's first-ever absolute emissions reduction target: a 7-10% cut from its peak levels by 2035. ❌ While international experts have criticized the target as insufficient for the 1.5°C goal, there's a strong historical precedent for China exceeding its climate commitments. China smashed its 2030 goal for wind and solar capacity in 2024, six years ahead of schedule. The new 3,600 GW renewable capacity target for 2035 is more than six times its 2020 levels and signals an unprecedented energy transition. The official targets should be seen as a floor, not a ceiling, for China's ambition. You say? 👇 ____ #china #greenenergy

Innovation Exchange: What China and India Can Teach Each Other? Check out our breakdown analysis in the latest issue of my newsletter. https://www.linkedin.com/pulse/innovation-exchange-what-china-india-can-teach-each-dudarenok-%E8%89%BE%E7%86%99%E4%B8%BD-zecfc

In the post-Nvidia era, China's biggest AI breakthrough isn't the model — but the chips powering it? 🤯 Cambricon, a Chinese AI chip company, just posted a 4,348% revenue surge in the first half of 2025, reaching over US $400 million. Fueled by geopolitical pressure, a new generation of Chinese AI chip companies is creating a parallel ecosystem from the ground up, and the numbers are staggering. 👇 Meet the key Challengers. 1️⃣ Cambricon: After seven straight years of losses, this company defied expectations. Its Siyuan 590 AI chip helped turn the company profitable for the first time in 2024. Despite being on the U.S. Entity List, its stock became China's most expensive by price-earnings ratio—a clear sign investors are betting on a domestic future. 🖖 2️⃣ Moore Threads: Founded by former Nvidia executives, this startup isn't just building chips. It's aiming for a complete AI platform. The company's GPUs already claim to match the performance of older-generation Nvidia gaming chips, and it's backed by massive investor confidence, as seen in its recent $1.1 billion IPO filing. 💰 3️⃣ Biren: This company grabbed headlines when it unveiled its BR100 GPU, claiming performance on par with Nvidia’s H100. With a $2 billion valuation, Biren is a prime example of the technological ambition driving this new ecosystem. Geopolitical pressure from U.S. export controls didn’t slow China down. It did the opposite. It forced domestic innovation into overdrive. Now, we're seeing an entirely parallel ecosystem being built. Take Baidu, for example. It successfully activated a massive 30,000-chip cluster using its self-developed Kunlun chips, capable of training DeepSeek-level AI models entirely on domestic hardware. This is no longer just about building an Nvidia clone—it's about creating a custom-built, end-to-end AI platform. 💨 The commercial validation is happening faster than anyone predicted. Private investors are pouring money into these companies, betting that a locally-sourced, custom-built AI infrastructure will be the long-term winner. 🤓 We are still a long long way to go. Think Chinese chips will be competitive sooner than projected? 💡 ——— Original picture is in Chinese, we translated it. Sources of data and other details, please refer to the original post.

Happy Monday 🥳

So, what’s up in China? 🇨🇳 Issue 300, covering 16 Sep - 22 Sep👇 1.⁠ ⁠Berkshire exits BYD after a 17-year run. 💰 Warren Buffett's firm completely liquidated its BYD stake worth US $9 billion at peak, ending 17-year investment that grew 20-fold from original US $230 million. BYD shares dropped 3.6% signaling waning Western confidence in Chinese EVs. 2.⁠ ⁠Xiaomi recalls 117,000 SU7 EVs nationwide. 🚗 China's smartphone giant recalled 116,877 SU7 vehicles produced February 2024-August 2025 after fatal crash exposed driver-assistance system flaws. The recall affects obstacle recognition and lane control, triggering 6.1% stock drop. 3.⁠ ⁠DeepSeek trains AI model for $294,000. 🤖 Chinese AI developer revealed R1 model training cost just US $294,000, dramatically below Western rivals' multimillion-dollar budgets. Critics note total development including prerequisite V3 model reached US $5.87 million. 4.⁠ ⁠US lawmakers target Anker tariff probe. 🔥 House China committee urged the Commerce Secretary to investigate Chinese electronics maker Anker for alleged tariff evasion and unfair pricing practices. The probe reflects escalating US scrutiny of Chinese manufacturers' trade compliance. 5.⁠ ⁠China keeps lending rates unchanged. 📈 People's Bank of China maintained benchmark lending rates for fourth consecutive month in September as trade tensions showed easing signs. The decision signals cautious monetary policy while authorities assess recovery momentum. 6.⁠ ⁠iPhone 17 draws massive China queues. 📱 Apple's latest iPhone 17 attracted hundreds of customers in long queues across Chinese cities, demonstrating sustained premium smartphone demand despite domestic competition. The strong turnout contrasts sharply with concerns about Apple's China position. 7.⁠ ⁠Nvidia shares drop on China ban. 📉 Nvidia stock fell 3% after China implemented comprehensive ban on its AI chips, escalating semiconductor restrictions between world's largest economies. The move affects billions in potential revenue while accelerating domestic chip alternatives. 8.⁠ ⁠Five-star hotels cook curbside meals. 🧘 Luxury hotels across 20+ Chinese cities set up street food stalls to offset revenue losses from banned official banquets and reduced business travel. Grand hotels serve crayfish for US $12, generating US $4,100 daily revenue despite losses.

Does exceptional service still translate into real customer loyalty in China? 😬 Yes, in 2025, Haidilao - one of country's top examples of service culture - still relies heavily on wow service as a foundational part of its strategy, but there's more. Here’s what make them unique: 1️⃣ Hyper-personalized service delivered through 专属客户经理 (dedicated customer managers). This deep, personalized connection is a powerful modern loyalty driver for the chain. 2️⃣ Robust ecosystem and digital integration are likely the most significant reason for 200 million members in its loyalty program. For instance, Haidilao member points can be used with other industries like travel and transportation, etc). 3️⃣ Diversified A Thousand Stores, A Thousand Faces Strategy 千店千面 also plays a role, as Haidilao caters to diverse needs, such as local tastes (e.g., spring menus in Shandong, cherry blossom menus in Hubei) ; cooking workshops (e.g. fresh cut beef workshop, seafood workshop, etc); late-night snack joints and pet-friendly stores, etc. Plus their multi-brand strategy with 126 stores under 14 other brands (like BBQ and fried chicken sub brands) also make a difference. More in the recent Bloomberg article by the amazing Biyun Song. Your take? https://www.bloomberg.com/news/articles/2025-09-11/short-sellers-target-china-s-haidilao-on-dimmer-growth-outlook

What happens when a small startup takes on a giant like DJI ? 😳 Especially when they're both from the same city. You might have seen the viral video: Insta360 CEO JK Liu showering his team with cash 💸 after their Antigravity A1 drone shook the market. 😂 It's easy to throw money, but motivating a team to genuinely compete with a titan like DJI is another story entirely. 🎥 DJI is a near-monopoly. With an estimated 70-80% global market share in consumer drones and a reputation for cutting-edge technology, it seems insurmountable. Yet, a college dropout’s dream, Insta360, went from zero to a US$12 billion company not by competing on specs, but by completely rewriting the rules of the camera industry. 👇 Here’s how they did it. The "Near-Death" Moment that Changed Everything. 😮 In its early days, Insta360 faced a major setback. Sales were struggling, and the company was on the brink of failure. But instead of giving up, they pivoted. By focusing on user behavior, they observed people using ordinary selfie sticks with their 360 cameras. 🤔 This led to a breakthrough: the "invisible selfie stick" technology, which seamlessly erases the stick from the shot. That one insight birthed the ONE X, a global hit that taught them a critical lesson: users don't buy hardware, they buy experiences. And then? 1️⃣ Culture as a Competitive Edge. 🏃‍♀️💨 CEO JK Liu’s leadership created a chaotic, yet brilliant, culture. They embraced a "thief culture," encouraging the team to borrow the best ideas from anywhere—from Xiaomi to DJI, and even 3D printing hobbyists. They even offered cash incentives for employees who lost weight, turning internal competitions into fuel for breakthrough innovation. 🫣 It's a philosophy that prioritizes rapid, user-centric development over rigid corporate structure. 2️⃣ Redefine the Battlefield. 🎯 When launching the Antigravity A1 drone, Insta360 faced a clear choice: compete directly with DJI's advanced lineup or find a new angle. They chose the latter. While DJI focused on landscape-focused aerial shots for professionals, Insta360 emphasized human-centric storytelling. The A1 was positioned as a tool for creating dynamic, personal stories. The genius was in the software that let users film once and reframe the shot later. They also priced it at a bold $999, a fraction of DJI’s flagship, prioritizing market share over short-term margins. ⏩️ Instead of building better drones, he built better user experiences. ⏩️ Instead of chasing specs, he chased stories. The lesson for other founders: Sometimes the biggest disruption comes from rejecting industry assumptions about what matters most. You say? 🤓👇

But how do you maintain quality at that price point? Wang's three-part strategy: 1️⃣First, end-to-end integration. Instead of buying expensive components, Unitree builds everything in-house. Motors, sensors, AI chips. This vertical approach cuts costs while maintaining control. 2️⃣Second, measured scaling. While competitors raised massive funding rounds, Wang took eight smaller ones. No vanity metrics, no premature expansion. Focus on getting the fundamentals right. 3️⃣Third, cultural resonance first. The H1 humanoid captivated over a billion viewers at the 2025 Spring Festival Gala. Domestic success before global expansion. And here's what really sets Unitree apart: ✔️ Open-source philosophy meets viral marketing. Their robots dance, do backflips, and navigate stairs. These demos generate millions of views without massive ad spending. ✔️ Unitree’s innovations, like the G1’s affordability, earned global recognition at events like the 2025 World Robot Conference, beating 780 applicants worldwide 👇 The business model is fascinating. Unitree scaled from niche sales in 2024 to mass production in 2025, achieving a billion-dollar valuation through strategic funding. 🤔 How? ✔️ They're not selling robots; they're selling the future of "embodied intelligence." By 2035, the humanoid market is projected to reach $38–43 billion, with Unitree positioning itself as the affordable gateway. 🚀Wang's leadership philosophy drives everything: "Passion-driven iteration beats endless funding." His team prioritizes breakthrough moments over incremental improvements. While Boston Dynamics perfects warehouse automation, Unitree democratizes robotics for manufacturing, search-rescue, and entertainment. 🌎 The IPO horizon signals global ambitions. Unitree is eyeing global expansion, with plans to scale production and distribution worldwide. ❓The question becomes: can established players adapt to this affordable revolution? Wang's journey proved that innovation leadership doesn't always require the biggest budget. Sometimes constraints force breakthrough thinking that resources can't buy. Your take? 🤓👇

This is Wang Xingxing with his very first robot dog models in 2017. 🤓 Fast forward 8 years, and his company Unitree Robotics sets sights on $7B IPO valuation. 🤖 Here's how Unitree cracked the robotics code: China's industrial robot production jumped 35.6% YoY, hitting 369,316 units in H1 2025. But while giants like Boston Dynamics chase perfection, Unitree chose a different path: affordability. The breakthrough moment came from constraints, not resources. 👇 Wang Xingxing bootstrapped from his university lab in 2016. Laikago, Unitree’s first quadruped robot (2017), laid the foundation for its humanoid breakthroughs, which has taught him something crucial: expensive doesn't mean better. 🤖 The G1 humanoid costs under US $16,000. That's cheaper than many laptops, and far below competitor prices.

Check out the links to the news below. 👇 https://www.cnbc.com/2025/09/04/huawei-mate-xts-trifold-launch-specs-price-features.html https://www.reuters.com/commentary/breakingviews/chinas-carmakers-are-heading-crash-2025-09-04/ https://www.tekedia.com/chinese-tech-giants-still-chase-nvidia-chips-despite-beijings-warnings-amid-u-s-china-tech-war/?srsltid=AfmBOoqWcglQ0aA1BehR9pmTzyTroGlcILsxAJTmpH4tk5Nj2lwBS_NM https://www.scmp.com/tech/tech-trends/article/3323904/smic-take-full-control-subsidiary-chip-foundry-chinas-fab-industry-consolidates https://ca.news.yahoo.com/tech-war-anthropics-claude-restrictions-093000963.html https://finance.yahoo.com/news/chinas-instagram-just-dropped-3b-170431311.html https://www.globaltimes.cn/page/202509/1342423.shtml https://www.sixthtone.com/news/1017577

So, what’s up in China? 🇨🇳 Issue 298, covering 2 Sep - 8 Sep👇 1.⁠ ⁠China's EV overcapacity crisis deepens. 🚗 EV sales hit over 50% of total car sales but price cuts led to mounting losses across brands including Xpeng, Zeekr, and Xiaomi. Production capacity reaches 36 million units versus 14 million demand, creating severe overcapacity threatening supplier ecosystem sustainability. 2.⁠ ⁠Huawei launches trifold phone. 📱 The company unveiled Mate XTs with Kirin 9020 chip on September 4th, priced at US $2,520, marking first named Kirin processor since 2021. This bold comeback strengthens domestic dominance while pushing foreign competitors to innovate rapidly or lose market share. 3.⁠ ⁠Tech giants chase Nvidia despite warnings. 🤖 Chinese firms including Alibaba and ByteDance pursue Nvidia's H20 chips (US $10,000-$12,000) despite Beijing's discouragement, with 600,000-700,000 units stockpiled. Companies eye the next B30A model promising six times more power, exposing continued reliance on US technology. 4.⁠ ⁠SMIC consolidates chip foundry control. 🔥 SMIC plans full buyout of subsidiary SMNC from state investors including China's national chip fund, part of industry-wide consolidation wave. Shares surged 4.9% in Hong Kong as China's major foundries strengthen operations amid global semiconductor competition. 5.⁠ ⁠Anthropic restrictions hit Chinese-backed AI. 💪 Anthropic blocked access to 50%+ Chinese-owned entities globally, affecting ByteDance's Trae coding editor and other overseas tools. The restriction creates uncertainty for Chinese tech giants' international AI strategies despite workarounds through subsidiaries. 6.⁠ ⁠RedNote targets triple profit surge. 🛍️ China's “Instagram" privately told investors it expects US $3 billion profit in 2025, tripling from over US $1 billion in 2024. With 300 million monthly users and US $31 billion valuation, the lifestyle platform outpaces Snap while deepening e-commerce integration. 7.⁠ ⁠Unitree eyes robotics IPO filing. 🤖 Chinese robotics firm Unitree plans IPO filing between October-December 2025 amid growing investor interest in automation sector. The move signals confidence in commercializing humanoid and quadruped robots as China positions itself in next-generation robotics market competition. 8.⁠ ⁠China restricts study aids nationwide. 🧘 Authorities tightened rules on study aids across cities including Shanghai and Shenzhen to reduce student pressure, limiting each course to one free workbook. Despite 5.9 billion copies sold in 2024, reforms challenge China's traditional "drill-and-practice" education approach. What news caught your attention last week?🤓👇

😲 The DeepSeek moment, world's top high-speed rail system, EVs global lead, space program and more... You might already be surprised by China’s pace, but this is just the beginning. 👇 In this newsletter, we'll explore: ✔️ The global rise of micro-dramas ✔️ Other industries that are expanding globally from China (and fast!) ✔️ How your business can participate or (sometimes) replicate their success. https://www.linkedin.com/pulse/rise-chinas-micro-dramas-other-chinese-billion-dollar-dudarenok-%25E8%2589%25BE%25E7%2586%2599%25E4%25B8%25BD-1noec

🚗📱 From budget phones to €40k supercars in 14 years. How did Xiaomi crack the code that Tesla took decades to master? They didn't reinvent the wheel. They applied their phone playbook to four wheels. Here's how they cracked the pattern: 🔄 2010-2014: Building the Foundation Xiaomi launches MIUI software and their first smartphone. They grew rapidly in China and hit a US$45 billion valuation by perfecting ecosystem strategy where products work seamlessly together. 📱 2014-2020: Mastering Complexity Managing 200+ processor platforms and 20+ file systems across thousands of SKUs taught them something crucial: how to make chaos feel simple for users. HyperOS uses Linux and their in-house Vela system for compatibility across everything. 🏠 2017-2023: Expanding the Vision In 2017, Xiaomi started building a new operating system for all their devices. The Human × Car × Home vision was born. 🚗 2024: The Ultimate Test The SU7 arrived as a smartphone on wheels. What did 14 years of phones teach them about cars? ✔️ Speed matters most. Monthly software updates instead of yearly model refreshes.  ✔️ Ecosystem lock-in works. Seamlessly switch camera sources during video calls across devices.  ✔️ Services beat hardware margins. Profit from ongoing relationships, not one-time sales.  ✔️ Anticipate user needs. Use data intelligence to solve problems before users notice them. 🏡 Picture this daily flow: Your morning alarm triggers the coffee maker, your car pre-heats, navigation syncs to your phone, and home lights turn on when you return. 🤓 But why does this work so well? HyperOS creates a cohesive ecosystem where smartphones, tablets, smart home devices, and electric vehicles communicate seamlessly. Every device learns from the others. Here's the key difference: 🇺🇸 Tesla builds cars that happen to be smart. 🇨🇳 Xiaomi builds smart ecosystems that happen to include cars. Master one category deeply, then apply that DNA everywhere else. What’s your take? 💬

🛁 “Leisure patterns are becoming more experience-centered,” says Ashley Dudarenok, founder of China research and digital consultancy ChoZan. “Young consumers increasingly see bathhouses as safe heavens, places to relax, recharge, and socialize. Instead of going shopping or traveling far, they spend an entire day here for less money but richer experiences.” Economic pressures are also reshaping spending habits. “Consumers are seeking cost-effective, value-rich experiences,” Dudarenok adds. “For under 500 RMB, you get unlimited snacks, games, and spa treatments, far cheaper than combining a night out, a movie, and dining. It’s rational spending with a focus on emotional satisfaction.” Your take? https://jingdaily.com/posts/inside-china-luxe-bathhouse-boom-from-caviar-buffets-to-chanel-scents

So, what’s up in China? 🇨🇳 Issue 297, covering 26 Aug - 1 Sep👇 1.⁠ ⁠China and India pledge to be 'partners not rivals’, as Xi, Putin and Modi share a laugh at security summit in Tianjin on Sunday. 2.⁠ ⁠Alibaba stock soars 19% today. Analysts turn bullish on AI and cloud growth after strong Q1 results showed 26% cloud growth and doubled AI revenue — prompting multiple analyst upgrades. 3.⁠ ⁠Consumer IPO boom signals market confidence. 💰 Hong Kong IPO fundraising jumped to US $13.7 billion in H1 2025 from just US $1.7 billion in 2024, with tea chains Mixue and Guming among top offerings. Private equity investments hit US $31 billion in Q2, strongest since 2022. 4.⁠ ⁠DeepSeek hints at next-gen chips. 🤖 AI firm cryptically announced "home-grown chips to be released soon" with speculation around Huawei, Cambricon, Moore Threads as potential suppliers for model training. 5.⁠ ⁠BYD crushes Tesla in Europe. 🤩BYD registrations surged 225% to 13,503 units in July while Tesla plunged 40% to 8,837 units across European markets. Chinese EV brands now command a record 5% European market share. 6.⁠ ⁠China's AI economy growth. 🚀 Beijing projects AI could to contribute over US $1.5 trillion to GDP by 2035, with smart computing power growing 46.2% annually through 2028 versus 18.8% for general computing. 7.⁠ ⁠Power grid dominance fuels AI race. 📈 China maintains 80-100% electricity reserve margins versus US's 15%, treating AI data centers as "convenient oversupply absorption" rather than grid threats. This infrastructure advantage could determine the global AI leadership race outcome as energy becomes a bottleneck. 8.⁠ ⁠Open-source AI adoption surges nationwide. 🧠 China's AI penetration reaches 95% in government and 78% in finance sectors as training costs plummet 90% compared to 2024. DeepSeek, Alibaba, and Baidu shift focus from technical performance to practical usability, driving commercial adoption across telecommunications and healthcare. 9.⁠ ⁠Mini Labubu dolls sell out globally. 🤪 Pop Mart's newest Mini Labubu dolls sold out within minutes across China, US, Japan, and South Korea on August 28th. Priced at US $11 domestically versus US $22.99 internationally, the instant sellout reflects sustained global demand for Chinese pop culture exports. 10.⁠ ⁠Single mothers create shared households. 😅 Nearly 30 million Chinese single mothers increasingly move in together, splitting bills and childcare outside traditional family models as economic pressures mount. Alternative living arrangements gain social acceptance, challenging conventional Chinese family structures. What news caught your attention last week? 🤓👇