In 2017, Apple CEO Tim Cook told U.S. President Trump that “coding should be a requirement in every public school. We have a huge deficit in the skills that we need today versus the skills that are there.” According to McKinsey, 800 million jobs could be replaced by robots by 2030. A report by Dell and the Institute for the Future (IFTF) states that 85% of jobs that will exist in 2030 haven’t been invented yet. So how are kids being prepared for this exciting future full of robots and new digital companies? There are a number of companies focused on answering at least a portion of this question, and making big bucks in the process.
One of the key trends is to teach STEM (Science, Technology, Engineering and Math) in a more fun and accessible manner. Beijing-based JMD Education estimates that STEM-education could become a $15 billion market by 2020.
Makeblock is a Chinese startup headquartered in Shenzhen surfing this global wave of teaching kids how to build robots and how to code. Makeblock sells do-it-yourself robotics kits that need to be manually assembled by students who then write code to control their robots. Think of small, LEGO-like robots that students can control by writing simple lines of code. The company claims to have sold its do-it-yourself robotics kits in over 140 countries with over 5 million users in more than 20,000 schools worldwide, including AltSchool, a Silicon Valley education start-up backed by Mark Zuckerberg. In 2017, Makeblock raised a $30 million series B round at a $200 million valuation. One of its investors is famed Sequoia Capital, which in China is led by Neil Shen, who topped the Forbes 2018 Midas List of the world’s most successful tech investors.
Makeblock is an example of a micro-multinational, a company that was born global, not even 10 years old, but already has more than 70% of revenues coming from outside of China, where it was founded. Below is an abbreviated exchange with Jasen Wang, the founder of Makeblock, who prefers to talk about STEAM instead of STEM, adding an A for “Art” in the acronym, as Makeblock aims to help kids “to be creative and truly turn their ideas into all kinds of robots instead of just following instructions.”
Ricardo Geromel: Why are you doing this? How did it all start?
Jasen Wang: I grew up in a poor village with no chance to play with electronic toys or computers. At University, I developed a passion for programming and robotics. This passion for technology made me want to bring more young students into the maker movement, so I founded Makeblock when I left college. When I was learning robotics, I found it very difficult. I needed to find materials from different sources and I needed to learn a lot of new technology in order to build a very simple robot. So, I wanted to solve this problem and provide a platform for people to easily build their ideas and quickly find the necessary physical parts needed to build any kind of robot. When I started this business 6 years ago, even for me it was hard to find the materials to build a simple robot. Now with our products, children 6 or 8 years old can easily build a robot – they’re learning to solve problems with robots.
RG: What are some of Makeblock’s key achievements so far?
JW: Makeblock has 460 employees, half of whom are R&D personnel. In 2017, sales reached 203 million yuan ($31.4 million), 70% of which came from overseas. A bit about Makeblock funding background: In 2013, it received 1 million yuan in funding. In 2014, it raised $6 million in a series A round of funding from Sequoia Capital. In 2017, it raised a $30 million series B round at a $200 million valuation. Makeblock has subsidiaries in Europe, the United States, Japan and Hong Kong, and has entered a strategic partnership with Japan’s Softbank. Makeblock’s products have entered over 140 countries and we have 5 million users around the globe. In France, Makeblock products have been incorporated into French school textbooks, and over 6,000 French primary and secondary schools are using Makeblock-based software and hardware STEAM courses.
RG: Tell us about Shenzhen. Why was your company started here? What are the competitive advantages of being in Shenzhen?
JW: Let me break it down in four areas.
Innovative environment: Shenzhen is called the Silicon Valley of China. Under the reform and opening-up policy, Shenzhen has become the most innovative city in China. In Shenzhen, the high-tech industry is booming. To date, Shenzhen has more than 6,700 high-tech enterprises. Many people come to Shenzhen to pursue their dreams.
Location Advantage: Manufacturing is developed and factories are abundant, providing strong supply chains, fast product-update rates, advantages in production, and close connection with factories. Moreover, Shenzhen is one of the [most] important export bases in China, and there are many foreign trade enterprises here.
Human Resource Advantage: Shenzhen is one of the important components in the Guangdong-Hong Kong-Macao Greater Bay Area. Shenzhen is welcoming a large amount of high-end technology personnel from all over the world, and the local government policy is friendly to talents from other places. For example, there are lots of subsidies available for highly educated talent who choose to stay in Shenzhen, like rental and living allowance. Also, the government encourages high technology start-ups.
High Efficiency: Shenzhen is a place that keeps advancing. There is a phrase called “Shenzhen speed,” because everyone here is competing with time every day. New thoughts come out rapidly and things are changing very fast here. Being highly efficient is the objective that everyone is trying to achieve. Shenzhen is a city that is attractive to young generations for its high efficiency, open-minded culture and convenient transportation.
RG: Describe how the strategy differs between North America and South America.
JW: In North America, people are more familiar with STEAM education. We don’t need to educate the market. We are focusing on raising awareness and branding. For South America, people are not familiar with STEAM, so we will focus on telling people about the concept and educating the market first. We will participate in more related events to have exposure of Makeblock products. Also the import taxes are quite different. South American taxes are higher, causing the products to be much more expensive. For products, we will choose different products lines for different countries and areas in the South America market.
RG: Can you share your plans for Brazil?
JW: For Brazil, we will join necessary education-tech events to gain more exposure. We will cooperate with educational partners to exploit the market together. For 2018, we will make sure we have all necessary certifications for our products and choose the most popular products to get into Brazil's market.
RG: Elon Musk and others are afraid of an AI apocalypse. Elon Musk has said “Robots will be able to do everything better than us. ... I mean all of us… This is really the scariest problem to me.” What do you have to say to people that fear AI and Robots?
JW: We shouldn’t be afraid of AI and Robots, instead, we should be glad to see the development of these kinds of technology, because they are making our lives easier. Robots cannot replace humans, because humans own the capability to create, and machines are programmed. We need to improve ourselves and gain more capabilities in order to catch up with the times. Humans should be the creators and controllers of high-tech. This year AI will start to become mainstream and impact our lives in a tangible and meaningful way. For example, facial recognition is becoming our new credit cards. Also, autonomous vehicles will be omnipresent.
Follow Ricardo Geromel on Twitter at @RicoGeromel
