CM Venture startups meet Phoenix Contact China for 1-day exchange and lead-generation

April 16, 2024

CM Venture’s Q1 CEO event was an exchange/learning/lead-generation session in collaboration with Phoenix Contact - 9 April 2024

Held at Phoenix Contact China headquarters in Nanjing, China, a total of 12 CM startups attended: BEAVER Biomedical Engineering Co.,Ltd, Crowntech Photonics, CSMH, Guofu Hydrogen, Global Power Technology(Beijing) Co., Ltd., Nanotop, Prismlab China Ltd., Skysys Intelligent Technology, Thingple Inc., Tetrels Technology Corp., Xingtera Inc. and Zenithnano.

Attending the event were CM portfolio company CEOs: Chen Tong 陈彤 (GPT), Wang Kai (Guofu Hydrogen), Yin Wengang 殷文钢 (Nanotop), Li Kun Zhou李昆洲 (Tetrels), John Wang 王海滨 (Skysys), and Zhou Yun Zheng 周云峥 (Xingtera).

The exchange event was opened by Phoenix Contact China President, Gu Jiandang (顾建党), and CM Venture’s Dr Min Zhou. The event was hosted by CM Venture’s Xavier Wong.

“The power of connections in business is vital. Just like how Gu and I met at our 2016 Innovation China Conference, our connection now has become more relevant than before. It will be the same for new connections made between CM startups and Phoenix Contact departments today, because it can develop into something incredible in time. It’s also amazing how Phoenix Contact started with basic, quality products at just low prices each, eventually building it to over 3 billion RMB in sales yearly. We look forward to be inspired by the exchange session today!” – Dr Min Zhou

The morning started with an introduction to CM startups and their core technologies, with Guofu Hydrogen (clean energy), Skysys (solar energy maintenance) and GPT (semiconductors) as highlights. Phoenix Contact had internal experts share four exclusive lectures on: R&D/IPR, Supply Chain, Lean Manufacturing and Sales/Retail.

The CM startups and CEOs were then given a tour of its highly-advanced Phoenix Contact Smart Manufacturing Plant. At the end of the day, a special one-on-one session between Phoenix Contact’s departments and CM startups took place to develop collaborative opportunities.

Dr Min Zhou, CM startup CEOs and Phoenix Contact China President rounded up the evening with an exclusive discussion and dinner at the Marriot Nanjing.

The event is reflective of the quality of our ecosystem, helping to build opportunities, relationships and bridges to drive innovation and value. Event insights below.

Event Highlights/Takeaways

Phoenix Contact China President Gu Jiandang | 顾建党:

  • The last 3 years have been challenging for all enterprises in China. Many MNCs based in China have been undergoing a transformation process, including Phoenix Contact.
  • As a foreign-owned enterprise, Phoenix Contact is unique as it continually evolves with domestic market needs and policies.
  • With 31 years in China, Phoenix Contact is rooted in Nanjing and has proudly localized itself for the market. For example, Phoenix Contact’s new electric vehicle innovation base is being built in Nanjing.
  • Phoenix Contact’s CVC arm isn’t about financial investments, but to support Phoenix Contact’s upstream/downstream needs. This is done by nurturing local startups through co-innovation with its internal expertise and experience.
  • Phoenix Contact believes in delivering the right product for the right application.
  • Mr Gu believes the ‘traditional Chinese VC era is over’, with government/SOEs as the main source of direction. In this environment, a borderless mentality and open partnerships can help VCs break through the boundaries.
  • Phoenix Contact believes CM Venture stands out because of this. Mr Gu also said, “Phoenix Contact and CM Venture have an exceptional type of partnership.”
Phoenix Contact’s R&D/IPR process. Lecturer: Zhou Fengchun | 周凤春 – 技术管理部经理:

  • Phoenix’s innovation processes in Germany and China are different; the purpose is to achieve breakthroughs based on local conditions/needs. To create value, co-innovation is key.
  • Part of the R&D process is an eight-milestone journey (M1-M8) from customer brief/market insights to delivery
  • The teams include intellectual property work in the R&D process – not at the end of it.
  • In Europe, the focus is mainly on quality, but Phoenix Contact’s China arm takes this up two notches further: incorporates (Functionality) quality, (Schedule) speed and (Budget) price, forming a strong ‘Magic Triangle’ of value

Phoenix Contact’s Supply Chain. Lecturer: Gao Binke | 高彬科 – 供应链管理总监:

  • Five major functions of the integrated supply chain platform (1) Lead (2) Interface (3) Connectedness (4) Planning (5) Professional
  • Integrated Supply Chain is tightly linked to Local Innovation & Operational Excellence to form a ‘procurement triangle’ for efficiency and cost optimization.
  • SP (Sustainable Procurement), Buyer and TQC (Total Quality Control) come together as a category management team to keep procurement operations competitive

Phoenix Contact’s Lean Manufacturing. Lecturer: Sha Nuo | 沙诺– 持续改善经理:

  • Phoenix Contact China’s lean operations system is dual-driven by lean research and development with lean manufacturing. It always adheres to customer value as its starting point, focusing on business processes and organizational construction. It provides diversified lean tools and methods, and encourages all employees to participate in improving processes and reducing waste, so as to achieve comprehensive operational excellence and shared success with relevant parties.
  • The PEX system is deployed following the route of: point, line, surface, and volume. It also adopts the 3K (support improvement, project improvement, and daily improvement) promotion method. Centering on Q\D\C\S\M\P\F (quality, delivery, cost, efficiency, capacity building, and more), it focuses on aspects such as quality, delivery time, cost, efficiency, and capacity building, integrating improvements into its daily business ops, and continuously brings financial benefits to the company

Phoenix Contact’s Sales/Retail. Lecturer: Wang Yaowu | 王耀武 – EB业务团队经理:

  • Leverage online traffic acquisition to transform business opportunities, Phoenix Contact implements quantitative sales management through its 1+N model (‘1’ refers to Phoenix Contact’s flagship store on Alibaba industrial brand platform ‘1688’, ‘N’ refers to various Alibaba distributor stores).
  • Innovative sales strategies not only improve sales performance, but also increase market share for the brand
  • Phoenix Contact also works with other online platforms (outside of Alibaba) to widen reach
  • Offline and online channels must work together

Phoenix Contact Smart Factory Tour

  • The intelligent automatic WMS system is 17 meters high, with automatic storage pickers remembering where everything is stored. The system cuts out human labor and saves thousands of man-hours each year in item retrieval/storage.
  • Efficient material processing and management. For example, a customized dehumidifying system can remove moisture from plastic pellets (for injection molding) in 30 mins, instead of 3-6 hours.
  • Kaizen process with simplified inspection standards modularizes efficiency and makes less errors. For example, inspection items were cut down from 12 to just 3, and is based on a simple green/red colored card system to highlight issues.

One-on-one sessions between Phoenix Contact departments and CM startups

Specific Phoenix Contact departments met up with CM startups to develop collaborative opportunities:

  • Nanotop, ZenithNano & CSMH met with Phoenix Contact’s R&D/Technical team, led by Peter Yin, PO Connectivity & Chief Local Innovation Officer (Product Organization)
  • Tetrels met with Phoenix Contact’s EHS and Manufacturing Technology/Parts/infrastructure department
  • Xingtera  & Global Power Technology (GPT) met with Phoenix Contact’s Electric Vehicle Division and Industrial Cabinet Connectivity

CEO Dinner Session Wrap-Up

CM Venture CEO Dr Min Zhou shared Smart Manufacturing insights over the CEO dinner, attended by: Phoenix Contact China President Gu Jiandang 顾建党, Yin Wengang 殷文钢 (Nanotop), Li Kun Zhou李昆洲 (Tetrels), Zhou Yun Zheng 周云峥 (Xingtera), John Wang 王海滨 (Skysys), Henry Hua (CVC Head, Phoenix Contact) & Peter Yin (Chief Local Innovation Officer, Phoenix Contact). Highlights included:

  • Key roles of Smart Manufacturing: (1) Enhance value (2) Reduce cost (3) save the planet
  • Cost reduction key to new technology adoption: ie. EV demand rises with fall in cost of batteries
  • Profitability depends on value-cost differential: the turning point is to drive a higher perceived value – yet increasing perceived value doesn’t have to cost much
  • Smart Manufacturing can directly contribute to Scope 1, 2, 3 carbon emission reductions