Let’s go on with our introduction of some striking personalities among Chinese real estate developers. Two weeks ago, I described the Pan Shiyi / Zhang Xin couple and its flamboyance. Another real estate developer is worth a few words: Wang Shi, who has founded and developed the Vanke China company, nothing less than the world’s largest residential real estate developer in 2013.
The interesting aspect of these new billionaires “careers” is to see how they reflect the change that occurred in Chinese economy these 30 past years. This is especially true about Wang Shi, a man who sees his own life as an adventure.
There is very little adventure at the beginnings, in the 1970s. The young Wang Shi works as a civil servant for the Guangdong rail-road company, then, as China timidly begins to open up to the world, he moves to the administration for foreign trade in Guangzhou. This is now the early 1980s, and the mood in China is beginning to change.
Wang Shi has the most enviable position in this state driven economy, but he decides to resign in 1984 and to go to Shenzhen. This is a frontier town, at the border between continental China and Hong Kong, a place which is developing at a very fast pace. Wang Shi decides that this is the place he needs to be. Adventure is really beginning.
A gambler: corn, chicken and pigeons
Wang Shi tells a story to illustrate his life in Shenzhen and the way he does business there. Hong Kong has a lot of chicken farms to feed its population, but with little land, the issue is to feed the chickens. With other people, Wang Shi buys corn in Shenzhen and exports it to Hong Kong.
Everything goes fine, the business is working and Wang Shi is very efficient, he becomes one of the main corn exporters of Shenzhen. A bad twist occurs when the Hong Kong news broadcasts that chicken food is cancerous and that it would be wise to avoid eating chicken. All of a sudden, Hong-kongers give up eating chicken and buy pigeons. Wang Shi’s wagons are stuck in Shenzhen railway station, the corn has become impossible to sell and things just worsens when a massive storm destroys it. Wang Shi is broke and in debt.
Still, he is not worried. He believes that Hong-kongers will never really give up eating chicken, and he goes even more in debt to purchase the totality of corn in Shenzhen. A few days later, the news announces that the cancerous chicken food was a false rumour, and Hong kongers resume eating chicken as usual. Wang Shi has made a fortune on this deal.
The founding of Vanke a non-specialized company becomes real estate giant
He ventures in various fields, and becomes this kind of businessman with no clear focus, going from one deal to another. In 1988, he founds Vanke China, he vessel for his non-focused business. The company is successful and in 1991, it is one of the first companies to be listed in the brand new Shenzhen stock exchange market. In the early 1990, the real estate activities of Vanke are growing fast and this this the challenge: how to manage fast growth in various fields ? Quickly, Wang Shi proves to be a master manager and Vanke China become a leading company, with original management principles. The most important of these: reinvest all the profits above 25%, a strong characteristic when in the meantime many real estate companies show benefits rates above 40%.
Another spcific guideline: no bribe, with its drawback: Vanke China has no project validated inside Chinese large cities centres. However, the company is healthy and proves to be successful. In 1996, Vanke China gives up all its activities except real estate. This is now a focused company, and the results, year after year, are going to be impressive. In 2013, Vanke China is the largest residential real estate developer in the world.
Climbing, hiking, an explorer of the world’s peaks
Wang Shi likes to climb mountains, he is among the very few Chinese people that has reached the top of all the continents’ highest peaks, and is has done this at the age of 60, as well as trekking in the north and south pole. This is about sport and about nature, ad probably explains why many of Vanke’s projects are genuinely nature-friendly. For example, the headquarters of Vanke in Shenzhen are an horizontal skyscraper designed by the American architect Steven Holl, a building where every energy consumption is optimized. A policy in Vanke’s projects is to use as little timber s possible, and many building have solar panels incorporated.
No routine, new challenges and studies
Wang Shi likes adventures. This can be down to earth when he divorces his wife just to marry a young actress.
Wang Shi has begun another adventure at the age of 60: he has been invited as a visiting scholar at Harvard University in 2011, and has immediately accepted. He is now a genuine student, passing the exams and taking notes, without secretary and without assistance. His English skills, a bit limited at first are now perfect and Wang Shi goes on will fulfilling a dream, to study abroad, something he longed for, but never had time because of his activities.
To set the pace and open new windows on the world
Wang Shi has taken a position a little bit in retreat, has resigned as a CEO and is now chairman of Vanke China. This is not something to be misunderstood, Wang Shi is still the person in charge at Vanke and the investors are still listening at what he says about the future of the company.
He wants to be seen as a role model, and Vanke China not as a leading company, but as a company that sets the pace of its business. The message for the Chinese citizens is to go and see the world, experience new fields and sky is the limit. He declares that he sees the world as a newborn baby, a personal mindset he believes is the source of all hos successes.
He still defines the role of the company and his studies in the USA could really be much more planned than it seems. There is a new twist: Vanke China is following its founding leader in the USA.
