I visit Timothy Chan on the day China’s rich list is published and he, a baby-faced 31-year-old, appears at number two. He is chairperson of Shanda Entertainment, a computer games manufacturer based in Shanghai’s Pudong district.
The setting is familiar: a Microsoft-style campus of low-rise offices and young, largely male staff, nerdy brilliance rising off them like heat haze. Inside, the furnishings are pistachio and lemon and the piped music a Chinese version of Burt Bacharach’s What the World Needs Now. To the mortification of his parents, Chan is worth $1,05-billion.
Stylistically, he owes a lot to the Silicon Valley pioneers of the mid-1990s. His idol is Bill Gates, whom he admires for his work ethic and abstinent lifestyle. Chan works seven days a week, eats dinner in the office with his colleagues, eschews a Ferrari for an Audi A8 and says he owns one property, an apartment in Shanghai, where he lives with his wife and newborn child.
How much of this is disposition and how much shrewd politics it is hard to tell; being rich in China must still be handled with care. When Chan talks about the Communist Party, of which he is a member, his eyebrow does the slightest ironic twitch. One assumes he moderates it according to his audience.
After studying economics at university, he worked in a state-owned company before founding Shanda with foreign venture capital. His idea was this: rather than trying to knock off Chinese versions of successful American companies, the smart money was on creating something home-grown, drawing on knowledge of Chinese culture.
“I’ve never been to any other country,” he remarks. “You’ve been to Hong Kong,” says Donglei Zhou, a Shanda senior executive. Chan makes a Homer Simpson face. “Hong Kong is part of China,” he says. “You see, I am a member of the Communist Party!” They both crack up.
Millionaires in China get a bad press — it is assumed they must have done something shady. But their numbers are growing so fast that to get on to the Forbes China rich list now requires an entry-level bank balance of $150-million, up from $6-million five years ago.
Chan is sensitive to his image problem. He talks about how the work is more important to him than the cash and how Shanda is socially and economically useful to China. Online games, he says, are teaching people to “lighten up”.
The company had to overcome two big cultural problems: piracy, and the attitude of Chinese parents towards children’s leisure time.
So Chan made his games online, so that kids could play them in Internet cafés, away from their parents’ watchful eyes; and he found a way to exploit the pirating culture.
The first game Shanda licensed was a fantasy role-playing exercise made in Korea, called Mir II, which above a certain basic level could be played online only. When players pirated and distributed their games, therefore, it added to the number of people paying to access Chan’s online network. Last year, Shanda made five million copies of its games and freely distributed them.
I ask Chan if the economic success of people like him will ultimately force the Communist Party to change. “I don’t think it’s necessary to ‘force’.” He gives a short, sharp laugh. “I joined the party when I was 18; I’ve been a member for 13 years. I’m a young man, but an old party member. I don’t think we need to force the party to do anything. But, we try to help the Chinese to lead happier lives. This is our vision.”
Chan comes from a loyal party background, which won’t have hurt his career. Until the 1980s games of the sort licensed by Shanda were banned; Chan’s business is still at the whim of the legislators.
His father is an engineer, his mother a teacher. Do they understand his world? “My parents are very common Chinese. They always support their son, but I don’t know if they understand me. Because they are the old generation. If I was a government official they would be much prouder of me. As a rich man, they don’t want to introduce me to their friends.”
He articulates his “vision” for social change in language that sounds almost Thatcherite: self-motivation, self-promotion, the emergence of the Chinese Dream. “I was born into a common Chinese family, but I’ve become a rich man. So, I don’t think we can blame the environment any more.”
But the poverty gap in China is huge; there are some environments, surely, you cannot overcome?
“It is very normal in society for there to be gaps [between rich and poor]. The poor man’s poverty can encourage him to study harder. If people are too happy with what they’ve got, they don’t work as hard.” This sounds a little sinister.
“I think competition is very normal in a society. If there is not a fair play environment for young people, this is wrong. I don’t regret anything. We contribute to society, pay tax, and give lots of people jobs. I’m very satisfied with what I do.”
Chan would like to form business partnerships with Western companies. “The powerful companies in China have to open the doors to foreign countries. I hope you can send a message from us — China is a huge market! And we want every game company to share the market; but they should find good local partners, and Shanda is the best.”
Chan says Gates’s business model works because he had the discipline not to diversify. “He can resist temptation, that’s why he is so great. I have half a billion dollars in my hand through this company, and …”
His colleague interrupts. “What do you mean half a billion? One billion!”
The eyebrow pops up. Chan grins. “I’m talking cash.” — Â