Electrical Engineering and Computer Science

Nick Yang: "Pirate-Entrepreneur"

Nick Yang

When Nick Yang looks in the mirror, he sees himself with a parrot on one shoulder, a black patch over an eye, and a light bulb glowing overhead. “I think of myself as a pirate-entrepreneur,” he said. “I build a ship that’s fast and mobile. I recruit a very special crew — it’s tough to get into my company. And I chart the course — I love getting ideas, the moment that light turns on and I figure out how to make a difference in people’s lives.”

Nick Yang (BSE EE ’97) is one of those folks who will never be bored or boring — his entire life has been an adventure, starting with spending his first nine years in China during the Cultural Revolution, moving to the United States for 15 years of top-notch education, inspiration and self discovery, then moving back to China at 24 to start his first company. At 35, he’s on start-up number three and already has a fourth in mind. He’s dynamic, driven to succeed and always on the lookout for new opportunities.

He demonstrated those same qualities at Michigan Engineering, where he learned how to learn. “There was so much going on. I got a lot of hands-on experience with the Solar Car team. I joined Eta Kappa Nu and made connections. I hung out on North Campus with other engineering students. We pulled all-nighters in the CAEN computer center. We played a lot of games and did a lot of surfing, but that’s how I got in touch with the Internet and really started thinking about the different ways people could use it. That’s where I got original ideas for my first start-up. I thought it would be huge, and it was.”

Sports consumed Yang, too. He followed football but devoured basketball. “I was there during the Fab Five era. I remember waiting all night outside Crisler Arena to get season tickets. It was a great time to be a Michigan sports fan.”

The University was also a great place to cultivate a passion that he’d had from a very early age: reading. Particularly philosophy and history, with an emphasis on warfare. He used On Guerrilla Warfare by Mao Tse-Tung as an example. “It’s become the basic textbook for waging revolution in underdeveloped and emergent areas, which is basically what entrepreneurship is all about. Mao advocated unorthodox strategies that converted deficits into advantages: he substituted mobility and surprise for superior firepower. You need strong support for the campaign, a clear exit strategy and confidence that you can win and go for it, even when there’s just a one in ten shot of success — if entrepreneurs only play when the odds are with them, great things rarely happen. I’ve never been afraid to go out on a limb. I’ve lost battles — but I don’t lose the wars. I’m very determined.”

Philosophy also figures into Yang’s style. “Most entrepreneurs are strictly engineers, businessmen or lawyers. But I’m also a philosopher — I lead by philosophy, I manage by engineering, I execute as if it’s warfare. If a plane crashes on an island, a real leader doesn’t build the shelters. He tells everyone to ‘stop crying and follow me.’ Then he picks key people to manage others who are better at the nuts-and-bolts of building huts.”

Yang’s success as an entrepreneur is startling, especially considering that he takes an unconventional approach. “When I start a company, I don’t over-think things. I know the recommended procedure is to analyze and tease things out, but I jump in. I figure things out as I go. Doing a start-up is like surfing a tsunami — you expect a wild ride, you make the tough adjustments as you go, to jump on the opportunities… like being a pirate. It’s worked for me.”

In 1999, Yang graduated from Stanford with a master’s in electrical engineering, raised $250,000 in capital from about 20 of his classmates, then went back to China and started his first company, ChinaRen Inc., where he served as chief technology officer until October 2000, when ChinaRen Inc. merged into Sohu.com Inc. More suitable to new ventures than to daily operations, Yang moved on to set up company number two, KongZhong, a mobile Internet business that provides wireless services. Recently he pulled the trigger on his third venture, Monkey King Search. “You can live without things like soft drinks — Coke, Pepsi and iced tea — but you can’t live without tap water, and these days a good search engine is fundamentally as important to people’s lives as tap water. So by building a great search engine like Monkey King, I can make a difference in people’s lives.”

In thinking how to make his search engine different, Yang took a look at competitors and saw that Google emphasizes technology, which he believes is only one piece of the search puzzle. “People don’t buy cars because of the engine,” he said. “They look at the whole car — what it looks like, the service they can expect, and how it fits their lifestyle, age and image.” So he decided Monkey King would be a search engine that focuses on things of importance to specific customer segments.

“The first version of Monkey King will appeal to a young market. It’ll be entertainment-based — music, texting, games, social networks, all the kinds of cool stuff that kids love.”

Yang paused before going on to reveal a bit of his philosophical nature. “Sometimes I wonder whether or not technology is good for people at all. We’re using up fossil fuels, making the air and water toxic. We’re shortening life on Earth with technology — we’ve done irreparable damage to our planet — and if we don’t do something, now, the Earth will only last 100 years. The physicist Stephen Hawking has said that it’s already too late. We have to find ways to create technology that improves and preserves life — all life. So, for my next start-up, my fourth, I’m planning clean, efficient nuclear energy generated by a reactor that’s no bigger than a desk. It’ll be controlled, safe and effective. We won’t need huge, remotely located power generators. They’ll be local and non-polluting. We won’t deal with miles of power lines. It’s going to change the world.”

Yang also waxed philosophical about management styles. “The democratic style wasn’t working for me, so I got rid of the senate, so to speak. I started thinking about conversations I had with Marines who came back from fighting the Taliban. This is going to sound terrible, but I see value in managing my start-ups like the Taliban manage their army. They have no formal management structure. They have few lines of communication. They separate into groups; each has its own commander with complete autonomy; each is mission-driven and when it completes a mission or needs to adjust what it’s doing, it pulls back and regroups. So, they’re not stationary; their units are fast, flexible, well trained and focused. There are no large targets to bomb, no lines of communication to destroy. Their units do what they have to do, then they’re gone, ready to start another mission. That’s why Taliban insurgents are hard to defeat. So, in my current start-up there’s no full management structure. I have units, each with a commanding officer and a specific mission. I hire the best and I let them do their own thing.”

He looks up to Thomas Edison, Henry Ford and Alexander Graham Bell because they did things that made a difference. “They weren’t scientists — science isn’t applied; it’s pure knowing, and that’s not enough. I’m not a scientist; I’m an engineer. An engineer makes things work and change for the better. If there’s one thing I want people to know about me, it’s that I’m a guy who wants to make a difference.”

Indeed, as a pirate-entrepreneur, he’s making a sea change in the way people live, work and play. And it’s likely he’ll be doing that, in new and different ways, for a long time to come.

Finding Balance

Entrepreneurs are by nature so immersed in their work that they're always in danger of living a life that's out of whack. But Yang keeps himself in balance. When he isn't out conquering business obstacles, he collects art, plays golf, follows Manchester United, England's premier football club, and gets in a good deal of family time. "I'm still an avid reader," he said. "There's always something to learn." He gets animated talking about movies such as The Matrix and, most recently, Avatar. And despite the fact that he's on the go, non-stop, for business, he does travel for pleasure. "I love Europe," he said. "Particularly Italy because it has so much history, culture and art." There truly is a ying of peace to Yang's hectic life.

- Michigan Engineer Spring 2010 (College of Engineering)