<p>I thought someone would have written up the answer in the meantime:</p>
<blockquote>
<p>China currently caps total foreign ownership in locally listed firms at 30%, and subjects a single foreign shareholder to a 10% limit.</p>
</blockquote>
<p>So you cannot be a foreign owned market leading company in China.
My non-academic source is a 2023 September <a href="https://www.bloomberg.com/news/articles/2023-09-22/china-mulls-easing-foreign-stake-limits-to-lure-global-funds" rel="nofollow noreferrer">Bloomberg article</a>.</p>
<p>It also reports that</p>
<blockquote>
<p>Authorities are pondering policy tweaks to boost overseas ownership in stocks listed in Shanghai, Shenzhen and Beijing as part of a push to open up the market and boost trading, the people said, asking not to be identified as the information is private.</p>
</blockquote>

CC BY-SA 4.0
2024-02-20T09:02:52.727Z
Sorry for that reason. I've never thought that one reason would be like this. Thanks.
Lerner Zhang
CC BY-SA 4.0
2024-02-20T08:36:54.820Z
2024-02-20T08:36:54.820Z
Giskard
<p>I am studying a very interesting entrepreneurial case: Rocket Internet, and one thing that confuses me is that they do business outside the U.S.A. and China.</p>
<blockquote>
<p>“We identify and build proven Internet business models and transfer them to new, underserved or untapped markets, mainly outside the United States and China, where we seek to scale them into market leading online companies”</p>
</blockquote>
<p>Source: <a href="https://link.springer.com/article/10.1186/s41469-018-0037-2" rel="nofollow noreferrer">Rocket Internet: organizing a startup factory</a></p>
<p>I can understand why they avoided the US, but cannot comprehend why they abandoned China.</p>
<p>In my opinion, China has long been blamed for its plagiarization, especially in the 2010s. That matches very well with Rocket Internet, and then China should be a perfect business environment for such a blatant cloning model.</p>
<p>I think it should not be due to the problem of GFW because there are still many foreign companies here in China from Germany or elsewhere. And I think there should be foreign startup accelerators &amp; incubators in China too. It's not that China is well served or tapped.</p>
<p>And China must not be an innovative country as America where Rocket Internet can explore and copy beneficial business models from. According to <a href="https://www.theglobaleconomy.com/rankings/gii_index/" rel="nofollow noreferrer">this index</a>, China ranked 29 globally in terms of innovation in 2014.</p>
<p>Please be factual and blunt (without considering <a href="https://www.youtube.com/watch?v=PWZnenTQDB4" rel="nofollow noreferrer">emotional damage</a>). Thanks in advance.</p>

CC BY-SA 4.0
2023-08-29T19:10:13.200Z
"*we seek to scale them into market leading online companies*" Are there any foreign owned market leading companies in China?
Giskard
CC BY-SA 4.0
2023-08-29T23:31:18.820Z
@Giskard No, and that's strange. Is it due to China's economic policies or strategies?
Lerner Zhang
CC BY-SA 4.0
2023-08-31T04:15:21.320Z
You said... "Neither can it be that ... China was/is less underserved". This phrase is confusing. Just say "It's not that China is well served". Perhaps Rocket disagrees. Companies in China are already doing what Rocket does.
H2ONaCl
CC BY-SA 4.0
2023-08-31T04:20:34.637Z
@H2ONaCl `Companies in China are already doing what Rocket does.` I totally agree with you on this point. But I cannot find any resources on this. My expression has been updated. Thanks!
Lerner Zhang
CC BY-SA 4.0
2023-08-31T04:24:09.540Z
@H2ONaCl But why is China so special on this? Can companies in other countries do the same way?
Lerner Zhang
<macroeconomics><markets><industrial-organisation><china><innovation>
Why does the Rocket Internet purposefully abandon the market of China?
Lerner Zhang
# Why does the Rocket Internet purposefully abandon the market of China?

(Asked by: username_0 on 2023-08-29)

I am studying a very interesting entrepreneurial case: Rocket Internet, and one thing that confuses me is that they do business outside the U.S.A. and China.

> “We identify and build proven Internet business models and transfer them to new, underserved or untapped markets, mainly outside the United States and China, where we seek to scale them into market leading online companies”

Source: [Rocket Internet: organizing a startup factory](https://link.springer.com/article/10.1186/s41469-018-0037-2)

I can understand why they avoided the US, but cannot comprehend why they abandoned China.

In my opinion, China has long been blamed for its plagiarization, especially in the 2010s. That matches very well with Rocket Internet, and then China should be a perfect business environment for such a blatant cloning model.

I think it should not be due to the problem of GFW because there are still many foreign companies here in China from Germany or elsewhere. And I think there should be foreign startup accelerators & incubators in China too. It's not that China is well served or tapped.

And China must not be an innovative country as America where Rocket Internet can explore and copy beneficial business models from. According to [this index](https://www.theglobaleconomy.com/rankings/gii_index/), China ranked 29 globally in terms of innovation in 2014.

Please be factual and blunt (without considering [emotional damage](https://www.youtube.com/watch?v=PWZnenTQDB4)). Thanks in advance.

**Tags:** macroeconomics, markets, industrial-organisation, china, innovation

> **Comments:**
> **username_1**: "*we seek to scale them into market leading online companies*" Are there any foreign owned market leading companies in China?  
> **username_0**: @username_1 No, and that's strange. Is it due to China's economic policies or strategies?  
> **username_2**: You said... "Neither can it be that ... China was/is less underserved". This phrase is confusing. Just say "It's not that China is well served". Perhaps Rocket disagrees. Companies in China are already doing what Rocket does.  
> **username_0**: @username_2 `Companies in China are already doing what Rocket does.` I totally agree with you on this point. But I cannot find any resources on this. My expression has been updated. Thanks!  
> **username_0**: @username_2 But why is China so special on this? Can companies in other countries do the same way?  

---

## 1 answers

### Answer by username_1 on 2024-02-20. Score: 1 | Accepted answer

I thought someone would have written up the answer in the meantime:

> China currently caps total foreign ownership in locally listed firms at 30%, and subjects a single foreign shareholder to a 10% limit.

So you cannot be a foreign owned market leading company in China.
My non-academic source is a 2023 September [Bloomberg article](https://www.bloomberg.com/news/articles/2023-09-22/china-mulls-easing-foreign-stake-limits-to-lure-global-funds).

It also reports that

> Authorities are pondering policy tweaks to boost overseas ownership in stocks listed in Shanghai, Shenzhen and Beijing as part of a push to open up the market and boost trading, the people said, asking not to be identified as the information is private.

> **Comments:**
> **username_0**: Sorry for that reason. I've never thought that one reason would be like this. Thanks.  

---

