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In this episode of China Money Podcast, guest Fritz Demopoulos, founder of Queen's Road Capital, shares his thoughts on China's Internet sector and entrepreneurship. As founder of two successful Chinese Internet companies, Shawei.com and Qunar.com, Demopoulos is now hoping to capture the next big opportunity in China's Internet evolution by deploying his own capital. Listen to the full interview in the audio podcast, watch the shortened video version or read an excerpt. Q: Last time when we talked, it was five years ago during the early days of your last start-up Qunar.com. This time around, you just founded Queen's Road Capital. What's your strategy and targeted industry? A: It's my personal investment vehicle that I use to invest in early stage companies. I try to focus on media and Internet companies, including consumer Internet, consumer facing models, and e-commerce related companies that are creating market places, that are thinking about how to deliver advertising better and more targeted (products and services) to consumers, as well as mobile consumer opportunities. Q: Any examples of companies that you have invested in? A: I'm an investor in a company called Wodache, a ride-share company. Everyone knows in the major cities of China, there are lots of traffic and it's very difficult to get a taxi. This company helps consumers to share cars through a mobile platform. It provides very strong functional value, so I'm very excited about it. Q: You were a successful entrepreneur before. Now you are an investor. Does the change of role make you think differently when looking at a start-up? A: Many investors are entrepreneurs and many entrepreneurs are investors. When I was an entrepreneur, I was always thinking about investing, and vice versa. So it's a constantly revolving door. Q: For those areas that you mentioned previously as places you look at intensely for investments, what specific elements do you try to find in a start-up that can lead to success? A: At least for me, the last thing I want to do is be where everyone else is. I always wanted to be the first within a category. You can't underestimate the value and advantage that a first-mover has. The team and concept is just a little bit down the learning curve than everyone else. Secondly, the team has to be completely focused on what they do. We need to see that the management teams and founders have skin in the game. Have they invested their own money? Have they given up other opportunities? Have they convinced their families and friends to invest? Thirdly, it's important that the founding teams understand their limitations. If they understand what they do well and what you are not good at, then they can simply hire the missing pieces. In terms of technology, clearly we live in a mobile world. Very rapidly, we are seeing the rise of mobile commerce, e-commerce, real transactions happening online, not just an order entry but proper payment processing all the way up to fulfillment. It is all about being able to present great product information to consumers in innovative ways that meets their specific needs. That entire chain is undergoing a significant revolution, especially with mobile and social media elements. Q: You are investing in early stage companies. What kind of failure rate do you expect? A: China is different because with a small amount of capital, you can survive for a long time. You give 20 companies a couple of million dollars a piece, they are going to last for five or six years even if those models haven't been successful. I'm not sure if that's the right way to look at it. If failure means going bankrupt, not many companies go bankrupt because you can last for a long time in creative ways in China. Q: You have been involved in the Internet sector in China for a long time. How do you make of the fact that the Chinese Internet space is so much more fragmented than in the West, where Yahoo,