Valley Girl November 17, 2009, 11:15PM EST

The Six Entrepreneurs You Meet in China

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The Expat Who Wins Big. Yes, "big" is a relative term, but when it comes to the Web, the expat name mentioned most often is that of Fritz Demopoulos. A Los Angeles native, Demopoulos moved to China in the late 1990s as an employee of News Corp. (NWS). He later left the company to start Shawei.com, a sports portal he sold to Tom.com in 2000 for about $20 million. He went on to co-found Qunar.com, an online travel company comparable to Kayak.com in the U.S.

Demopoulos has a down-to-earth demeanor and dresses like he's in Silicon Valley, with glasses and floppy bangs that never quite stay off his face. But he's also got a fighting streak. Five-year-old Qunar is locked in a legal tussle with Ctrip, the Chinese equivalent of Expedia.com (EXPE). Ctrip alleges that Qunar unlawfully gathers and posts information from its own pages.

Consultants advising Westerners who hope to do business in China warn of guanxi, the deep-seated relationships that can make it hard for outsiders to break in. But in a display of the same bravado that built Silicon Valley, Demopoulos waves off talk of guanxi, says he doesn't speak Chinese well, and adopts a build-it-first, ask-questions-later outlook when it comes to getting a company off the ground.

The "Copycat." The view in Silicon Valley is that some Chinese companies rip off their product ideas. Some even get a seemingly unfair leg up in cases where the government blocks U.S. sites in China. Twitter and Facebook aren't available in China, a boon for Facebook clone Xioanei and a new Twitter-like service launched by China's largest portal, Sina.com (SINA). (A lot of homegrown Twitter clones have been blocked, too.)

While they may crib product ideas, Chinese startups are blazing their own business model trail. Think of the contrast between eBay (EBAY) and Alibaba.com's Taobao. In China, eBay's stumbles are legendary, and Taobao has come in and owned the online consumer auction market. Nearly 50% of Chinese people online are Taobao customers, according to the company and Chinese Internet statistics. Taobao inked deals with several courier services so bidders without credit cards can pay for goods via cash-on-delivery. That's helped Taobao penetrate second- and third-tier cities in a way few e-commerce sites have.

Scratch the surface and you see the same innovation with Web 2.0 "rip-offs" of Facebook, Twitter, and even Match.com. And, as many companies have learned during the downturn, business model matters as much as product.

Lacy has been a business reporter for 10 years and is currently writing a book on global entrepreneurship. Her first book, Once You're Lucky, Twice You're Good: The Rebirth of Silicon Valley and the Rise of Web 2.0, was published by Gotham Books in May 2008. She also blogs for TechCrunch.