Finance Hotshots

A supremely important concept in the Chinese business and political world goes by the name of guanxi (关系). A close English translation may be “professional network.”—from everything I’ve learned about guanxi, though, that phrase doesn’t come close to capturing the reverence Chinese businessman and women have for the concept; I guess in the current economic environment if you want to get anything done here, you gotta have awesome guanxi—you need to be connected.


Something I have been wanting to do even before arriving in Shanghai is get to know some fellow foreigners involved in the vibrant finance world here. I wanted to hear from someone with first-hand experience how to get involved myself, and what it was really like being, say, an investment banker in this dynamic city. Last week, I had the opportunity to do just that.

It was maybe a couple months ago that I met a guy in his mid-twenties named Rob at a club called Sky Bar. We got talking somehow, and after asking the requisite, “why the hell are you in China?” I learned that he is an investment banker for a nearby boutique investment firm. After getting his card and sporadically staying in contact, we had the opportunity to grab burgers and Tiger beers at a cool Western restaurant last Monday, where I got to hear all about his experience here; from how he got started, to the challenging subtleties of the Chinese financial sector. Towards the end, he invited me to a semi-monthly get together he was in the process of establishing for young expats in finance, so the next evening, my friend Eric and I found ourselves sipping Guiness at the same table as five Shanghai finance hotshots in their mid-twenties to early-thirties, who were having an invigorating back-and-forth about the latest in the Shanghai finance world.

Most of the time, I sort of felt like I was listening to Chinese—catching maybe 60-80 percent of what they were saying; but from what I did understand, it really is a much different world than back home (not that I have had any experience in the finance world back home; some of these guys had though).

If I record my favorite quote of the night, I may run the risk of the Man kicking me out of the country (yes, I’ve heard of foreigners receiving that penalty for lesser petty speech-related crimes). But in a similar, though milder, spirit, I think my biggest takeaway was how prevalent coruption still is in the highest levels of the Chinese government and finance world. In my opinion, it seems like that is only the natural consequence of such a strong emphasis on guanxi, but for whatever reason, strong-arming, bribry, and under-the-table dealings are very much alive and well. I suppose you could make the argument that similar shenanigans probably happens at the highest levels of most governments and companies, so it's just a matter of degree. And I'm sure it's not as bad now as it was. But still, it's a bit unnerving hearing stories to this effect.

Another interesting thing I learned is there is a cap on the number of foreigners a given firm in China can hire; it varies by sector, but for almost everyone it is well under ten percent. Although this is no doubt hurting China’s productivity in the here and now, I suppose this kind of law serves to provide many more training opportunities for otherwise professionally inexperienced young Chinese people. So I guess it makes economic sense from a future-oriented, nationalist perspective.

It was cool hearing lots of other tidbits, as well as interesting anecdotes about some foreign companies that have succeeded over here, and others that haven’t. As for my overall impression, it seems that doing finance in Shanghai is a crazy, exciting, and challenging endeavor, and I was certainly inspired to step up my efforts to find a way to get my feet wet.