That worried venture capitalist Chauncey Shey: As a major shareholder of UTStarcom and the main brains behind its core product -- a PAS-based cell phone system for China -- he stood to lose out to rivals if the system was banned.
So the former Bell Labs consultant, who studied engineering in the U.S., invoked all his acumen -- and all his contacts as a Shanghai native -- to lobby bureaucrats to approve PAS (for personal access system). Shey told them it would be cheaper for customers than competing versions would be. The regulators relented.
Today PAS is used by one out of every 12 Chinese cell phone users. As for Alameda, Californiabased, Nasdaq-listed UTStarcom, it has nearly doubled its income every year since 1999 and has a current market cap of more than $2 billion.
Having built one billion-dollar business in China, Shey, 46, is getting antsy to build another. Conveniently, that happens to be his job: He heads up the China operations of Softbank, the Japanese venture capital outfit and one of UTStarcom’s main investors. (Another is Ying Wu, the 47th-richest person in China, according to Forbes magazine.) “We have U.S. know-how, Chinese know-how and Japanese know-how,” brags Shey. “We took some American DNA, Japanese DNA, Chinese DNA, mixed it and came up with something better.”
Shey is betting that the next billion-dollar China company he has a hand in building will be Hong Kongbased Alibaba. This Softbank investment is an online import-export trading platform that bills itself as the “world’s largest base of suppliers.” But Shey also has high hopes for his personal investments, which include a company that turns straw into “wood” (and gold, Shey hopes).
