How Shenzhen Became the Global Epicenter of High-Tech Innovation

Grassroots hardware innovators from around the world have been drawn to Shenzhen for a singular reason: it has the capacity to produce. Prototypes and products are easier and cheaper to develop and roll out here than anywhere else in the world, and a vibrant international community of hardware innovators have formed around the city’s electronics markets, startup incubators, and factories.

“It’s become a Mecca for people who make hardware projects that they want to make into products,” said Mitch Altman, the founder of NoiseBridge, one of the first makerspaces in the USA.

“In the old days if you wanted to be innovative, if you wanted to have the latest technology, you would go to Silicon Valley for electronics. . . But today it’s Shenzhen. Because of all of this open innovation it’s becoming the new place for everybody to gather,” said David Li, the co-founder of China’s first makerspace, XinCheJian.

Shenzhen, which sits in the Pearl River Delta just outside of Hong Kong, became a global epicenter of high-tech design and production by combining all aspects of the supply chain, design, and manufacturing processes together in one place. It is the world’s largest manufacturer of electronics, being the home of huge contract manufacturers like Foxconn, big companies like Tencent, BYD, Huawei, and ZTE, as well as a vibrant grassroots manufacturing ecosystem that is chock-full of tens of thousands of smaller factories, design houses, and product integrators. In 2014 The Economist declared southern China as the best place in the world for a hardware innovator to be, and successful companies like Coolpad, Dingoo, and G’Five International all got their starts there.

Silvia Lindtner, a researcher from the University of Michigan, explained that one of the attributes that makes Shenzhen so unique and effectual is that it has various models of design and production that sit side by side and feed off of each other. “Shenzhen didn’t create a uniform ‘This is what making means here.’ Instead, the city embraced the many different forms of production that had evolved there and function parallel to each other. So Shenzhen is a city characterized not only by large scale, big brand forms of mass-manufacturing, but also small, independent factories.” It is these small manufactures that are a boon for makers.

The makers are a global community of hardware designers dedicated to open source and do-it-yourself ethos that have made Shenzhen one of their epicenters. Many makers have been lured into the city by the colossal electronics malls, incubators, and workshops where they can access almost everything they need design, build, and get support for their projects in one place. Components that would take days or even weeks to source in the USA can be had in Shenzhen within a day — often by simply walking down the street to the nearest electronics market.

“Every step along the way, from idea to just getting a proof of concept to getting a prototype, to getting manufacturing put together, to getting manufactured is in Shenzhen,” Altman continued. “People from all over the world go there to get their projects into reality and start a small business around it. So there’s just a great community for pretty much anywhere anyone is in their development cycle for getting things done.”

Shenzhen also has a manufacturing system that is not oppose to working with startups looking to do smaller production runs of a few thousand units rather than demanding orders in the 100,000s or millions. “It is easy to approach a manufacturer in Shenzhen,” Lindtner explained. “Even if you’re a small startup many of them will take an interest because it’s like, ‘That could be a business opportunity.’”

Prynt Cases is one such startup that took advantage of Shenzhen’s kinetic design and production environment. The French startup did four months in Shenzhen with an incubator called Haxlr8r, developing their Polaroid-esque device that allows users to print out digital photos instantly with a case that attaches to their smartphone. “Shenzhen is a great city for hardware startups: you find all the tools, suppliers and contractors that are required to go through product development,” their CEO Clement Perrot explained. “Being in that environment allows you to iterate quickly (with next day delivery for example) and at a very low cost (no intermediary).” The Kickstarter campaign for their Shenzhen developed product initially aimed to raise US$50,000 but has so far topped US$1.1 million.

Other successful Shenzhen startups include PetCube, Palette, Fabule, Helios, WearVigo, and Notch.

Shenzhen’s start-to-finish supply of everything that is needed to manufacture electronics means that it takes vastly less time and money to acquire materials, create prototypes, and get products onto the market than anywhere else in the world. This has attracted a “Casablanca” like scene of innovators and tinkerers from around the world and turned Shenzhen into the “Maker’s Dream City.”

A version of this article originally appeared in the South China Morning Post at Forget Silicon Valley: Innovators drawn to ‘dream city’ Shenzhen to make things happen.