Xiaomi is probably the best example of a small company exploding in growth thanks to smartphones around the globe and in emerging markets. They started as a relatively no-name company, moved on to selling their devices exclusively online (and being completely unable to keep them in stock for more than a few seconds) and becoming one of the hottest names in the smartphone market in just a few years. There has been much anticipation on Xiaomi officially bringing devices to the US, growing into other tech segments, and continuing their exponential growth, but 2016 turned out to be a bump in the road for the little Chinese company that could.
If a small Chinese tech company growing too fast then running out of money sounds familiar, well, that’s because it’s almost exactly what happened to LeEco. Granted, Xiaomi has much bigger brand recognition than LeEco and even managed to steal Hugo Barra away from Google, but the moral of the story is the same; small company jumped into a market with their only goal being market share, and once they got the market share they didn’t know how to turn market share into profit.
CEO Lei Jun spilled out in a letter on Facebook that talked about how Xiaomi had miraculous growth in the first few years, but struggled to turn their ideas and popularity into a model for long-term growth. The only solution to that is to slow down a bit in 2017, improve, and make sure the company has a plan in place to last longer than a few years.
It’s not all doom and gloom in the CEO’s letter, and things for Xiaomi still look pretty good. They’re invested in different products (smartphones, televisions, home automation) and they’re seeing solid growth in different markets, especially India. While we probably won’t see 2017 be an incredibly aggressive year for growth and revenue for Xiaomi, it will probably be a year that creates a solid foundation for the company going forward.
source: Xiaomi (Facebook)