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An exodus triggered by abundant capital, growing innovation and flourishing career opportunities

 

A few years ago, Wang Yi was living the American dream. He had graduated from Princeton, landed a job at Google and bought a spacious condo in Silicon Valley.

But one day in 2011, he sat his wife down at the kitchen table and told her he wanted to move back to China. He was bored working as a product manager for the search giant and felt the pull of starting his own company in their homeland. Still, it wasn’t easy persuading her to abandon balmy California for smog-choked Shanghai.

“We’d just discovered she was pregnant,” said Wang, now 37, recalling hours spent pacing their apartment. “It was a very uneasy few weeks before we made our decision, but in the end she came around.”

Wang Yi

PHOTOGRAPHER: QILAI SHEN/BLOOMBERG

His bet paid off: his popular English teaching appLiulishuo or LingoChamp raised $100 million in July, putting him in the growing ranks of successful Silicon Valley alumni lured back to China by the promise of a brighter future. His decision is emblematic of an unprecedented trend with disquieting implications for Valley stalwarts from Facebook Inc. to Alphabet Inc.’s Google.

U.S.-trained Chinese-born talent is becoming a key force in driving Chinese companies’ global expansion and the country’s efforts to dominate next-generation technologies like artificial intelligence and machine learning. Where college graduates once coveted a prestigious overseas job and foreign citizenship, many today gravitate toward career opportunities at home, where venture capital is now plentiful and the government dangles financial incentives for cutting-edge research.

“More and more talent is moving over because China is really getting momentum in the innovation area,” said Ken Qi, a headhunter for Spencer Stuart and leader of its technology practice. “This is only the beginning.”

Chinese have worked or studied abroad and then returned home long enough that there’s a term for them – “sea turtles.” But while a job at a U.S. tech giant once conferred near-unparalleled status, homegrown companies -- from giants like Tencent Holdings Ltd. to up-and-comers like news giant Toutiao -- are now often just as prestigious. Baidu Inc. -- a search giant little-known outside of China -- convinced ex-Microsoft standout Qi Lu to helm its efforts in AI, making him one of the highest-profile returnees of recent years.

Qi Lu

PHOTOGRAPHER: BILLY H.C. KWOK/BLOOMBERG

Alibaba Group Holding Ltd.’s coming-out party was a catalyst. The e-commerce giant pulled off the world’s largest initial public offering in 2014 -- a record that stands – to drive home the scale and inventiveness of the country’s corporations. Alibaba and Tencent now count among the 10 most valuable companies in the world, in the ranks of Amazon.com Inc. and Facebook. Chinese venture capital rivals the U.S.: three of the world’s five most valuable startups are based in Beijing, not California. And it doesn’t help that U.S. President Donald Trump’s administration continues to pursue restrictive immigration policies, discouraging foreign students and workers alike.

Tech has supplanted finance as the biggest draw for overseas Chinese returnees, accounting for 15.5 percent of all who go home, according to a 2017 survey of 1,821 people conducted by think-tank Center for China & Globalization and jobs site Zhaopin.com. That’s up 10 percent from their last poll, in 2015. The number of graduates returning from overseas – mainly from the U.S. – skyrocketed to 432,500 in 2016, up 22 percent from 2013, the survey shows.

The Rise of China’s New Economy Titans in Seven Simple Charts

Not all choose to abandon the Valley. Of the more than 850,000 AI engineers across America, 7.9 percent are Chinese, according to a 2017 report from LinkedIn. That naturally includes plenty of ethnic Chinese without strong ties to the mainland or any interest in working there. However, there’re more AI engineers of Chinese descent in the U.S. than there are in China, even though they make up less than 1.6 percent of the American population.

A cyclist rides a bicycle inside the Googleplex headquarters in Mountain View, California.

PHOTOGRAPHER: MICHAEL SHORT/BLOOMBERG

Yet the search for returnees has spurred a thriving cottage industry. In WeChat and Facebook cliques, headhunters and engineers from the diaspora exchange banter and animated gifs. Qi watches for certain markers: if you’ve scored permanent residency, are childless or the kids are prepping for college, expect a knock on your digital door.

Jay Wu has poached over 100 engineers for Chinese companies over the past three years. The co-founder of Global Career Path ran online communities for students before turning it into a career. The San Francisco resident now trawls more than a dozen WeChat groups for leads.

“WeChat is a good channel to keep tabs on what’s going on in the circle and also broadcast our offline events,” said the UC Berkeley grad who’s hosted sessions for Alibaba and JD.com Inc. as well as online travel service Ctrip.

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Why Chinese Workers Are Leaving Silicon Valley to Head Home

Why Chinese Workers Are Leaving Silicon Valley to Head Home

Ditching Cupertino or Mountain View for Beijing can be a tough sell when China’s undergoing its harshest internet crackdown in history. But its tech giants hold three drawcards: faster growth in salaries, opportunity and a sense of home.

China’s internet space is enjoying bubbly times, with compensation sometimes exceeding American peers’. One startup was said to have hired an AI engineer for cash and shares worth as much as $30 million over four years.

Read more: In Battle for Talent, One Startup Founder Tries ’Unlimited’ Pay

For engineers reluctant to relinquish American comforts, Chinese companies are going to them. Alibaba, Tencent, Uber-slayer Didi Chuxing and Baidu are among those who have built or are expanding labs in Silicon Valley.

Employees and visitors walk inside Alibaba Group's headquarters in Hangzhou, China.

PHOTOGRAPHER: QILAI SHEN/BLOOMBERG

Career opportunities however are regarded as more abundant back home. While Chinese engineers are well represented in the Valley, the perception is that comparatively fewer advance to the top rungs, a phenomenon labeled the “Bamboo Ceiling.”

“More and more Chinese engineers who have worked in Silicon Valley for an extended period of time end up finding it’s much more lucrative for them career-wise to join a fast-rising Chinese company,” says Hans Tung, a managing partner at venture firm GGV who’s organized events to poach talent. “At Google, at LinkedIn, at Uber, at AirBnB, they all have Chinese engineers who are trying to figure out ‘should I stay, or should I go back.’ ”

More interesting than prospects for some may be the sheer volume of intimate data available and leeway to experiment in China. Tencent’s now-ubiquitous WeChat, built by a small team in months, has become a poster-child for in-house creative license. Modern computing is driven by crunching enormous amounts of data, and generations of state surveillance has conditioned the public to be less concerned about sharing information than Westerners. Local startup SenseTime for instance has teamed with dozens of police departments to track everything from visages to races, helping the country develop one of the world’s most sophisticated and extensive surveillance machines.

China’s 751 million internet users have thus become a massive petri dish. Big money and bigger data can be irresistible to those itching to turn theory into reality.

Read more: China’s Artificial Intelligence Bid Seeks a $59 Billion Industry

Xu Wanhong left Carnegie Mellon University’s computer science Ph. D. program in 2010 to work on Facebook’s news feed. A chance meeting with a visiting team from Chinese startup UCAR Technology led to online friendships and in 2015, an offer to jump ship. Today he works at Kuaishou, a video service said to be valued at more than $3 billion, and commutes from 20 kilometers (12 miles) outside Beijing. It’s a far cry from the breakfast bar and lush spaces of Facebook’s Menlo Park headquarters.

“I didn’t go to the U.S. for a big house. I went for the interesting problems,” he said.

Then there are those for whom it’s about human connection: no amount of tech can erase the fact that Shanghai and San Francisco are separated by an 11-hour flight and an even wider cultural chasm.

Chongqing native Yang Shuishi grew up deifying the West, adopting the name Seth and landing a dream job as a software engineer on Microsoft’s Redmond campus. But suburban America didn’t suit a single man whose hometown has about 40 times Seattle’s population. While he climbed the ranks during subsequent stints at Google and Facebook, life in America remained a lonely experience and he landed back in China having soured on Western life.

“You’re just working as a cog in the huge machine and you never get to see the big picture. My friends back in China were thinking about the economy and vast social trends,” he said. “Even if I get killed by the air and live shorter for ten years, it’ll still be better.”

— With assistance by David Ramli, and Lulu Yilun Chen