Among Japanese start-ups, the presence of Chinese technicians is growing. They believe that knowledge of artificial intelligence (AI) and computer graphics can be useful in Japan, so they are working on development as AI technicians. With the rise of generative AI, and other issues, it is becoming increasingly difficult to acquire AI engineers in Japan, and the number of companies that require experienced engineers is increasing. The Nikkei Shimbun (Chinese edition: Nikkei Chinese explores why these Chinese AI personnel are not working in Japanese startups in China and the United States, which are leaders in the field of AI.
Li Ran, who is the chief technology officer (CTO) of FLUX (Shibuya, Tokyo), who is engaged in "no-code" software development services that do not require programming knowledge, said: "The market in China and the United States is large, but the competition is fierce, and the probability of start-ups succeeding is small."
FLUX is engaged in the business of providing website design that is easy to increase profitability based on the results of daily analysis for D2C (direct-to-consumer) companies that sell products, etc. through their own websites.
The company that Li Ran participated in the startup was recognized as a start-up in the department of Tokyo Institute of Technology
Start a business in Japan
After dropping out of the University of Cambridge in the United Kingdom with a major in computer science, Li Ran graduated from the Department of Engineering of Tokyo Institute of Technology after specializing in machine learning and deep learning. Seeing his friends starting businesses in the U.S. and China, he said, "I found that most start-ups [in China and the U.S.] are either acquired by big companies or only the technology is imitated."
Li Ran founded FLUX in Japan in 2018 as a founding member. He analyzed: "Most of Japan's large companies cannot implement digital transformation (DX) independently, but entrust external companies to develop systems. Start-ups are undertaking the digital transformation of Japanese companies."
Li Ran believes that many large Japanese companies still use programming languages developed more than half a century ago in their core systems. "In order to keep the position of engineers who understand the old system, many companies still can't change the core technology," he said. He pointed out that "it is precisely because of the conservative side of the IT industry that startups working on new technologies are attracting attention," and he said that there is a lot of room for development in the Japanese market.
China has twice the number of AI-related papers in the United States, and is one of the most active countries in the world for AI development. AI technicians who came to Japan from China to work in unison said, "Japan is easy to work and comfortable to live in." Many Chinese engineers believe that the AI and computer knowledge they have learned at university can be put to use in Japan.
Refuse Huawei's internal decision
Yingxue Sun, who works as a principal engineer at FLUX, is from Tsinghua University. After graduating, she studied a master's degree at the University of Tokyo, rejected Huawei's internal decision, and joined FLUX. "When I entered university, AI was not so hot," Sun Yingxue graduated in a major that is now one of the top two at Tsinghua University and is very popular. "Law schools and economics schools are also learning programming languages, and there are a lot of people who want to get into the AI industry," she said.
Most of Sun Yingxue's college classmates went to companies such as Huawei and Tencent. Although Huawei offered her a salary equivalent to 10 million yen (about 500,000 yuan) for the first year, she rejected Huawei's internal decision because of "fierce competition and not much fun." She noted that "China works long hours and sometimes does not tell the purpose and reason for developing the business."
In Japan, even start-ups with few employees are mostly engaged in the development of large-scale projects. "The purpose and background of the business will be known to ordinary employees, so it will feel meaningful" (Sun Yingxue).
Chinese technologists are increasingly exchanging their workplace environment in "WeChat" group chats. For example, technicians working in "GAFA" such as Meta (formerly Facebook) in the United States and Apple in the United States asked: "I am not happy at all, is there any interesting work?" "Sometimes people in the group come out to introduce the work of Japanese start-ups.
CHINESE UNIVERSITY STUDENTS STUDYING AI-RELATED TECHNOLOGIES ARE EXPECTED TO CONTINUE TO INCREASE (REUTERS)
There are also several reasons for Japanese companies to accept these Chinese engineers. Regarding the factors that make Chinese engineers active in Japan, Li Ran, CTO of FLUX, said, "Even if you are close to a graduate student who is close to an engineer, there are very few people who have actually written code in Japan." In China, more and more students are making their own apps public on WeChat.
However, most software development companies in Japan, including start-ups, use a seniority salary system. Even if a skilled technician enters the company, he or she will not be commensurate with the results and will sometimes resign immediately. In addition, Japanese companies will need to establish an employment system that facilitates the work of capable human resources, including remuneration, with a view to multinationalizing employees.
The reason why Chinese artificial intelligence (AI) technologists work in Japanese startups is largely because Japan has an environment in which they can apply their acquired knowledge and latest technologies to development. The "Lean Startup" model, which quickly develops products at the lowest cost and repeatedly validates them, has become popular in Japan. Allegedly, this model makes it easy to reflect its own ideas into development.
In the latest programming languages
Huang, who studied Computer Graphics at the University of Tokyo for his Ph.D. program, worked in development at DeNA and start-ups. "In order to solve problems quickly, start-up engineers actively cooperate with projects to learn new programming languages," he says. "Engineers can grow by experiencing the entire process of a service from development to release."
Huang also noted that large Japanese companies "tend to start discussions based on programming languages that are currently available."
According to the 2021 China Programmer Salaries and Living Status Survey Report by the China Internet Network Information Center (CNNIC), 58.9% of employees working in China's IT industry are under the age of 29. People aged 30~34 accounted for 31.8%, and people over 35 years old were much less, accounting for 9.4%. "In China, 35 is a threshold, after which it is difficult to work as an engineer in many companies," Huang said, while in Japan you can work in development for a long time.
Development as a side business at emerging companies
There are also Chinese technicians who work in IT companies and at the same time work as a side job of development at start-ups. After graduating from Sun Yat-sen University in Guangdong Province, Chen studied for a master's degree at the University of Tokyo and is currently working for a large Japanese IT company.
He can earn enough income through his main business. But Chen Qianfeng explains why he started a side hustle: "New technologies are at the cutting edge and help you grow."
Chen Qianfeng said that among the online shopping platforms with a large number of users in Japan, "some websites are even built using technology from 30 years ago." He believes that "even relatively new companies will become more liable if they replace their core systems," and there is a tendency for companies to continue using their old systems.
Startups have the flexibility to switch to core systems. He asserts, "You learn more than your main business through a side hustle".
Economic opposites
AI research in China is very active. According to a survey by Dutch academic information firm Elsevier and Nikkei Shimbun, the number of AI-related papers published in 2021 reached about 43,000 in China, about twice as many as in the United States.
According to data from China's IT professional recruitment website "Lagou.com", AI-related recruitment positions increased by 95% year-on-year in 2021. With the rise of the AI industry in China, it is expected that the number of students studying related technologies will also increase.
Although personnel exchanges are becoming increasingly active, from a national level, Japan has strengthened export control in semiconductor-related fields, creating economic confrontation with China. How to get competent technicians by getting them? Start-ups in Japan may need to take different measures in the future.
Nihon Keizai Shimbun (Chinese edition: Nikkei Chinese Network) Minako Yamashita
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