From the ground up

GSR is a venture capital company that seeks business ideas in their embryonic stage. The first step is to give an aspiring person or group enough capital to get started. GSR also provides other industry resources, such as assistance to find personnel to help at a board or management level.

But it's a tough game. Wu said that GSR Ventures is approached by 2,000 to 3,000 tech-business proposals each year, of which a mere six or seven are selected for investment. And of these, only about half will succeed in the long term, said Wu. 

One of GSR's first success stories was Lattice Power, an LED light manufacturer and brainchild of Professor Jiang Fengyi, who developed a revolutionary new method to makes LEDs by using commodity silicon.

"He made the breakthrough in 2004," said Wu, who together with his partner invested in Jiang's LED research in 2005 before wooing a syndicate of investors including KP China Fund and Mayfair. "We're taking lots of risks and making lots of bets," said Wu. "We've invested over $100 million into [Lattice Power] and it's going to be earth-shaking when it fully materializes."

Lattice Power's LED lights hit the market last year and five years after the initial investment, revenue has finally "gone up like crazy" in 2010.

The guy next door

Wu's "guy next door" turns out to be Sun Jiangning, who is sitting quietly in one of GSR's rooms with his own technological breakthrough – also an LED light bulb.

A row of five bulbs is switched on and looking impressive. Sun, who has worked with electronics for 20 years, is getting ready for a demonstration he will give to GSR's partners that night. Wu is clearly excited about the prospect of investing in Sun's innovation.

"This is the best light bulb in the world in terms of cost and performance," he said.

The light, which uses an LED chip from Lattice Power, contains a new and improved integrated circuit, which Sun designed in 2008. It is Sun's new integrated circuit that makes this light so efficient. Manufactured for $6 each, they have a lifespan of 40,000 hours and use one-sixth the electricity of traditional light bulbs.

Like a growing number of Chinese technologists, Sun has a great idea and a proven product. All he needs now is investors to turn his startup venture into a bonafide company. He appears to be in the right country at the right time.