Now that many venture capitalists in China are no longer funding young companies, it's little wonder that there's room in the market for initiatives like Kai-Fu Lee's Innnovation Works. The incubator lab will seek to identify and nurture winning ideas among young Chinese entrepreneurs, and the best among them will have a chance to be funded by Innovation Works and its backers, which include Chinese venture capital firm WI Harper. Wonder if we will see more types of companies like Maxthon, the China-based web browser that Peter Liu of Harper funded a few years ago? I'm also wondering how the link-up with Harper will impact the lab's ability to work with other venture firms to tap the best startups.
Lee has considerable connections and knowledge of the Chinese entrepreneurial scene, and his backers -- Liu as well as Steve Chen of YouTube and others entrepreneurial leaders -- are equally well suited for the task. But amid all the press and PR about the new venture, questions continue to swirl around about what Lee's move means for Google China, and why he's leaving now. The fact is that he was not able to move the market share needle much against local search competitor Baidu. Even so, his departure from Google China is likely to mean Baidu may gain an even stronger advantage.