China is succeeding at what everyone else is failing at: localization

I remember when I was young, everyone had this stereotype in mind that China copies what everyone else is doing. I’m not a fan of stereotypes, but I think they usually reveal something deeper.

In the case of China, I think we are witnessing the reality behind the stereotype unfolding. They are proving to be amazing at localization. When one thinks about localization, it’s tempting to think about languages. But localization goes beyond that. It involves understanding the culture that you are building for and adapting your solution to fit the expectations and needs of the target audience.

This takes a lot of empathy that I believe we are losing in what people usually refer to as “the West.” Here it’s all about you: your success, your entrepreneurship journey, your ability to raise capital, every quantifiable aspect of your life and business. So without empathy, the awareness of the importance of localization is lost.

China has that, perhaps due to their political system. And as open source has shown, which has a community component to it and therefore more empathy embedded in it, you can easily outcompete solutions that lack that, close their systems, and try to solve everything by throwing capital at the problem.

I wouldn’t say Chinese copy. Chinese learn and adapt. We build models and impose them on everyone. If we look around, we see plenty of examples of this unfolding. From DeepSeek open-sourcing their models to, most recently, ByteDance open-sourcing a technology to build mobile apps, Lynx.

The last one is particularly worthy of analysis. Meta individualistically thought that it’s not their concern to package a technology in a ready-to-use solution for the community, so ByteDance went ahead and bundled framework and technology and packaged it in a beautifully productized solution.

They understood that wealth is concentrating in “the West” and that people don’t want to feel they are losing their purchasing power, so they adapted many of their products to make sure people continue to feel they can purchase the same or more than before.

The perception towards the Chinese and Chinese products is changing, and “the West,” particularly North America, can do little about it. Or maybe they’re localizing when it’s too late, like Amazon presenting a Chinese-like storefront, Amazon Haul.

Years ago, the argument they still use to this day—that the Chinese are bad—is getting weaker and weaker, especially as we see Donald Trump’s administration’s real interests. It’s two political regimes with different stories but similar goals.

So I dare to say the war with China has already started. The US is like Leonardo DiCaprio sinking in an ocean that the Chinese have become familiar with and have learned how to navigate better. They can try to tax the world, but that will only prompt the world to reconsider their dependency on their system.