Summary of David Versus Goliath in China’s Internet Industry

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Toutiao, Meituan and Didi (TMD) are China’s hottest unicorn start-ups – and tech giants Baidu, Alibaba and Tencent (BAT) have been instrumental in funding their growth. TMD firms were allowed to rise to prominence under BAT’s nose as stand-alone brands because they built businesses in areas the BAT companies had overlooked. But since 2016, as the two groups continued to expand into new markets, they have become fierce competitors. In an opinion piece on, op-ed writer Michael Lin Mao charts the development of the TMD companies and hints that BAT and TMD are likely to get in one another’s way. While the the article is thorough on TMD’s development, it only touches on the entanglement of these six companies and the conflicts on the horizon. Nonetheless, getAbstract recommends this dramatic and entertaining read to entrepreneurs and investors interested in China’s latest business trends and to start-up founders who benefit from BAT investments.

About the Author

Michael Lin Mao is an op-ed columnist with the Chinese business information platform



China’s next wave of popular tech start-ups Toutiao, Meituan and Didi – collectively known as TMD – are in a complicated parent-child relationship with the market giants Baidu, Alibaba and Tencent (BAT). On one hand, the TMD companies owe their existence and development to the BAT group, whose venture capital (VC) funding boosted TMD’s rise. On the other hand, to survive, TMD firms must break free from BAT and compete on BAT’s home turf.

The TMD companies are in this pickle partially because of how BAT has been expanding. Having plateaued in their original business areas, the BAT companies started diversifying by funding and acquiring start-ups. They are by far the largest financial backers of Chinese innovation in the tech industry. In 2017, they invested a total of ¥400.8 billion (more than $60 billion) in more than 155 companies. This put BAT and TMD at odds with one another as many other companies that...