In Shenzhen, Covid curbs pinch hardware startups

From an office in Shenzhen’s sprawling electronics district, an engineering team is prototyping a bioreactor that will one day produce “cultivated meat”, discussing component sizes in a video call with scientists sitting in kitchens and bedrooms in the UK.

It’s a complicated conversation about precision parts that would ordinarily need a hands-on meeting in Shenzhen, the hardware centre of the world where product makers can buy and tinker with any gear they need.

Hax, the firm backing the bioreactor, invests in more than 30 such hardware startups from overseas each year and would typically fly them to Shenzhen to build their products.

But China’s Covid-19 border closures have paralysed this movement of talent, throwing a spanner in the rapid cycles of product development that power Shenzhen, a free-wheeling tech hub built on the country’s early efforts to open itself to the world.

“We’d normally just jam with teams under one roof, rolling up our sleeves and getting involved in the electronics and chemicals, but we had to find a different way of working with teams,” said Ke Ji, a China-born mechanical engineer and Canadian citizen who is Hax’s programme director.

Without that international bustle, it is now mostly domestic staff and startups using the immersion tanks, humidity chambers and other obscure items in Hax’s spacious office in Shenzhen’s Huaqiangbei, the world’s largest electronics market.

Hax’s engineers now spend afternoons and evenings in calls with teams in North America and Europe, scrambling to source components to ship across the world, instead of teaching their startups how to do it.

While Hax leadership says the challenges of remote design are not insurmountable, they have presented clear roadblocks for others.

Henk Werner worked 14-hour days for several months to find a new model for his design space Trouble Maker, which helps small-scale hardware makers from overseas navigate Shenzhen.

In February, he was forced to vacate his shared office when his partner could no longer afford it.

“We were in a coworking space as a partnership, and that coworking space couldn’t survive with the closed borders - even the local Chinese companies were leaving.”