Ask HN: What to do when a Chinese startup clones your website?
Today we were approached by a Chinese user of our website who told us that a China-based startup has launched a direct clone of our website aimed at the Chinese market.
Our website https://strivewire.com is a host of for-money eSports tournaments in the Hearthstone vertical, but we are working on expanding to other games as well.
The website in question is a very obvious clone of ours and has both .com and .cn domains: - www.haogegebisai.com - www.chosengamer.com
Basically they copied all the design and even our logo down to the actual URLs.
I've added their CEO on WeChat and inquired about this, and he said they are big fans of our startup. But he also mentioned that they already have investors. Their website launched two days ago and already has a bunch of activity.
We've talked about this internally and hope to be able to gain this startup as a Chinese subsidiary, but we are still unsure if this will actually work out.
From a legal standpoint we are very unsure how much you can actually do in such a case. Should we just wait it out? Our should we aim to litigate to put pressure on their investors? I have some experience in international litigation in cybercrime cases, but from a practical perspective it is very likely to bind a lot of resources and focus.
Another huge problem for us is that we are in talks with a very large Chinese IT company (triple-digit $Bn market cap), and if there is a clone growing in their backyard they might pass on us.
It'd be great if people with more experience in these things could give us some advice.
Thanks, Benjamin
TL;DR: Chinese startup is cloning our business, unsure what to do
135 comments
[ 3.4 ms ] story [ 211 ms ] threadI am sure they use Chinese payment processors which are not directly integrated into the flow right now.
>as the server is in a country that has a notice and takedown system, including the United States and any EU country
HN would typically be aghast if you served NSFW content potentially to unexpecting audiences (..think of the children!), or even with the real life analog of becoming vigilante on someone who wronged you.
There seems to be the underlying notion that: because it's China, any riposte is acceptable. Again, HN would typically be aghast if you drew sweeping stereotypes over 1B+ people.
There are multiple solutions.
If someone is hotlinking your content, block their requests.
Lodge DMCA requests to remove their SE listing.
If you have a product and a brand that is being copied, Chinese customs are very pro-active on brand defense. Register your brand / trademark: http://www.forbes.com/sites/danharris/2015/10/12/how-to-prot...
Innovate and update more often. Copying, legal or otherwise happens all the time, in all jurisdictions. Ratinally weigh up the real damage their site is causing, and act accordingly.
If justice could be served using legal channels, then it would. As it is in the Free World. Given the parent's examples of why legal channels are unavailable, vigilantism is the automatic next best thing.
Legal channels often serve as the path of least resistance compared to vigilante acts in other cases. Their ineffectiveness in cases like this push people to do what they feel they must.
I don't know if I would call legal channels "ineffective" and I'm not anarchist enough to say that you "must" be a vigilante when they don't work. But yeah, sometimes it's really enjoyable to get back at people.
There's nothing wrong with being morally wrong. (Just as long as you're not hurting anyone, in my opinion.)
Furthermore I think (e)Sports is a rather apolitical thing so I wouldn't like to find myself on some Chinese blacklist, as we definitely want to expand in the asian markets.
Is China required or could you settle with Taiwan, South Korea, Japan, etc?
You might want to investigate the experiences of other businesses who have tried to sell within China. China's judicial system is worse than ours.
I wouldn't pump much time or money into tip toeing around their rules. Ultimately they can just block and clone you. Consider that China's blocking of FB, Twitter, and Google allow them to create their own copies of these sites that create jobs and earn money within China. China likes to say that these sites don't play by the rules, but it seems when you operate in China the goalposts are always moving. Personally I think that's because any government that is not by the people is unstable. That's up to them to decide, however.
The current interest in China (and our FOMO) is mainly driven by potential investors or acquirers. We've nearly finished our app with which we hope to bring eSports for-money tournaments to a whole new level.
In our type of business everyone is moving goalposts all the time, we have had interesting experiences with regulators in EU and US so I am unsure if Chinese bureaucracy can really top this.
Obviously, when structuring international business in that region Hong Kong or Singapore are prime locations, but I don't think the big vision can be implemented without having native speakers both in CN and SK.
As a German company, a lot of our "good old manufacturing" businesses have written case study over case study about expansion to China, with very mixed results. But I feel we're kind of forced into that decision right now, because growth can be explosive.
Here's a popular post about a guy doing it, I'm not sure where I first found this post, it might have been HN. Either way I'm pretty sure I've seen some of his stuff linked on HN. http://ascii.textfiles.com/archives/1011 He wrote several followup posts with metrics and stuff.
For example 3 people here say they use it as a strategy, and nothing about China: http://ask.metafilter.com/4302/Is-there-any-etiquette-to-hot...
This accepted answer with 17 upvotes recommends it: http://stackoverflow.com/questions/3990337/how-to-protect-ag...
Also see http://i.imgur.com/WDDH8wj.jpg http://krisalis.org/weblog/?p=1137
I disagree. Rather, its: "Because its not anywhere else, you have no option to defend the business you have created for yourself and your employees."
This has very little to do with China and more to do with the company has little other options given the circumstances.
If I were a web developer of said clone company, and I noticed hotlink protection had been enabled (easily, 301s, 404s), I would have already scraped all of the content on the page (new content notwithstanding), and onError I would serve up the copy of the content I had saved locally.
The only thing I could imagine you doing besides the retaliatory measures listed above is removing the site from SERPs. However, Baidu won't respect your wishes.
Basically they imitated the full design and even the URL routes. The "logo" has parts of our logo.
There are no hotlinks used.
What they are doing serves the Chinese market, which we didn't do yet (so it is a positive thing), but we don't have the resources to really compete with them yet.
There aren't a lot of other countries that share all those difficult aspects yet still have plenty of capable programmers.
http://www.forbes.com/sites/danharris/2015/10/12/how-to-prot...
Just because you have a mark registered in the US, doesn't mean China (or any other jurisdiction) will magically know about it.
There are solutions and structures in place - proper business practices dictate that you inform yourself and react appropriately.
Our brand isn't mentioned either in the marketing copy nor in the sourcecode.
In our experience, when a trademark is registered, Chinese customs is very proactive in seizing / destroying infringing property.
The domestic market is definitely another story, but there are controls in place for the export market.
The onus is on the brand owner to register their trademark - no different to registering a mark in any other jurisdiction.
Legitimate business has been conducted with China for centuries, and China has every reason to defend foreign brands in order to protect its manufacturing industry.
I believe the domestic market is what's at stake for the OP. haogegebisai is Chinese for "good older brother tournament" and that site is all in Chinese
Thanks for the translation! I thought the gege was standing for GG (good game), a part of eSports slang. For the rest my Chinese is too rusty :/
A small startup usually won't register trademarks in markets they don't operate in. This wasn't a problem before since those markets weren't interested anyways. But given the whole Internet industry in China is basically built around shanzhai-style copying (much safer than doing original design and developing original IP), we are gong to see a lot more of is in the future.
Even in terms of legal jurisdictions if a company in Australia clones it, and hosts and develops everything in Australia, you may need to hire an Australian legal team to fight it.
So the point is, a Chinese startup is much more likely to copy your website than a Nigerian, Russian, Romanian, Vietnamese, etc... startup.
So we changed the domain name, moved the site.
We then replaced the assets under the domain name they were using with assets that might offend folks when looked at.
Not everyone can change the domain though.
The main Chinese-Github DDOS was the Chinese Goverment/Great Firewall of China was it intercepting Chinese websites for non-chinese IPs, and inserting a script that DDOSed Github. Chinese users weren't relevant here.
Just trying to get some input on a tricky situation. Should we expand to China earlier than planned? Should we ignore it? etc pp
Furthermore they are hosted on AliBaba's cloud (from what I was able to see), so it looks like a more professional and IT-affine implementation.
It'd be great if I could ping you in the next days if we decide to move into that direction again.
[1] https://crowdin.com/
We haven't tested their backend logic which is a huge part of our competitive advantage to other platforms, and mainly assessed the thread by visually comparing the sites.
The thing is that they created the site from scratch but it is exactly like our site only directly aimed at Chinese users.
Our website is www.strivewire.com, and they use www.haogegebisai.com
They are not hotlinking anything, and we're shying away from an open confrontation. Just wanted to know if you know of some good strategies to approach this issue.
http://www.gamblingsites.org/laws/germany/
If what I've read about doing business in China holds a sliver of truth - both from stories linked here and elsewhere - it's not a chance they will pass on you but almost a given they will pass on you. I'm almost so suspicious of business practices in that market that I'd be willing to wager a small sum that maybe somebody in the very large Chinese IT company actually prompted another entity to get the clone up and running, or at least is aware of the situation.
If there's a way to take your idea and leave you nothing, I get the feeling that is exactly the path that will be taken. Unfortunately I can't help with direct advice to address, but I do wish you the best in your efforts to stamp out that terribly dishonest approach.
The thing is that I don't know who the investor behind this business is. If I knew it is a smallish business angel then there would be no reason to worry. On the other hand if they are in Chinese YC we have a problem :|
State Intellectual Property Office of China http://english.sipo.gov.cn/lxfs/
China Internet Network Information Center http://www1.cnnic.cn/PublicS/hyzl/
You can send them emails or even better call them. They all should have people who can communicate in English effectively. Getting in contact with them will help you put pressure on the offender, and also gather info for next move.
The best move is to hire someone from China to do some leg work for you, if that's necessary. No need for lawyers at first. There are many Chinese freelancers active in various international elance type sites. Also, http://www.witmart.com/ is reputable, operating from China.
China, at least the central government, is trying hard to implement tougher policies on protecting intellectual properties. The problems are mostly at the local level. If you know how to get the offenders' attention with effective threats on legal action, they are actually _very_ afraid of being caught. The cut-throat business competitions in China force them to avoid legal trouble and damage to their company's reputations, if they are legit startup trying to make it big, not some college students just playing around (in this case then you don't need to worry too much anyway).
Also wholesale copying western ideas is a widespread popular practice, I feel you are fighting the wrong battle. There is no way you can prevent somebody else (meaning hundreds if the idea is really good) in China doing the same cloning shit. Also conquering the China market needs many many other types of fighting, and preventing cloning is the least you need to worry about.
If you look at our website you see that we're using cheap bootstrap, so they are not really cloning our design asset, but the whole product / UX. They add some value for users by providing Chinese translations.
They told us they already have investors, and it seems at least two people are working on this. Unfortunately I was unable to find any info about company registration or the actual investor.
I sincerely hope that we can somehow work with them so we don't have to waste resources in fighting / worrying.
The key for anyone to make it in China is to understand that although China is utterly different from the west, it is _NOT_ a random and chaos place. It has its own well-oiled system running for the most time successfully for millenniums! It's scary to foreigners because it's so different so people tend to avoid it altogether. But in fact every issue has a well established way to be dealt with, obvious to locals but not obvious to a foreigner. So getting there and doing the right moves, you might emerge victorious.
Also in comparison to other industries, internet-related intellectual property protection is much easier to enforce by the Chinese central and local government, because they can order ISPs and Cloud service providers to pull plugs on the perpetrators web sites with enough poking from you or your liaison in China. Power to the censors and GFW related technologies! :) So be confident you will find ways to solve the problem. Good luck with your venture.
Edit: just to clarify - I personally wouldn't do this, because it is possibly illegal and absolutely unethical. But very large companies (in China and elsewhere) are not known for being ethical.
I can't say our website is very artistic, but here in Germany those laws can be enforced with much strictness, and people just wouldn't imitate you like that.
Maybe this is the payback for what the Samwer brothers have done to silicon valley entrepreneurs..
If I were a Chinese clone with this strategy, I would try to simulate that activity as soon as possible to make it seem like a legitimate threat. Can you get in touch with any would-be users within China who speak English and Chinese to gauge whether or not this site is legitimate before worrying too much? It seems you are short on facts at this point.
If they do for-money events then they most likely send around money through some payment apps which is hard to track for us.
We don't have very many Chinese users at hand but I will ask in the team to get more info on their marketing activities.
I mean sure, it might look like an affront on the work you've put in your site, but in the end, you've also found another group doing what you're also doing, probably just as dedicated as you are. Depending on the mutual language skills (maybe even consider using a telephone interpreter service https://en.wikipedia.org/wiki/Telephone_interpreting), you might be able to find common ground and work together towards a collaboration agreement or outright acquisition -- whatever it is, just make sure to have it in writing that your company came up with the concept and design. Win-win for both sides, and that contract is then legally binding.
Even more, if you're in talks with a very large Chinese company, having Chinese collaborators might actually work in your favor.
TL;DR: You might have more to gain by working on a collaboration deal first. Just never lose sight of the fact that, in the end, they were stealing.
As you said, the huge bonus is that they are dedicated to eSports as well and have put substantial effort into capturing our (potential) Chinese user base. Thank you as well for the pointer to phone interpreting services, I would've tried to leverage some friends in China, but this seems like a good alternative.
At first it would seem like a very bad thing, but if you think about it, they are merely reinforcing your idea. I say give them the finger and just focus on making the best of your idea no matter what those guys are doing.
I wish you all the best for that!
"Lions aren't concerned about the opinions of sheep"
Working hard on bringing the other stuff on the road, so your advice bodes well. Thanks again!
If your goal is making money and/or securing a partnership you have to put yourself into a position of strength. The best way to do this is to launch an actual Chinese competitor yourself. This should cost no more than 10k USD per month assuming you can leverage your existing code, which makes it much cheaper than going the legal route. Feel free to contact me (contact info in profile) if you need help or introductions to people who can actually make this a reality for you in a week or two. I'm in Beijing and have done three startups in China and can put you in touch with people here who can actually help you.
A live product from you poses an existential threat to your competitors and keeps the big IT company from delaying in perpetuity (the typical modus operandi for big players here is to have middle management rush to agreement on the general principles of possible cooperation and then stalling and never doing anything more substantial -- the delay means they aren't sure if it is worth their while to clone you yet). But the threat of your getting actual traction matters because growth puts a deadline on your willingness to accept other people stalling, and your presence starts imposing actual costs on the startup. Those guys will need to change their branding at a minimum since they can't build an independent brand with you in the market, and once they know you will play hardball you will find them a lot more amenable to compromise if you want to go that route. With that said, if your market reception is good you may not even want to continue talking with them, since most Chinese startups are really inefficient and you can probably blow them out of the market anyway.
We're really not sure what to expect from the Chinese market, and if our resources aren't better spent on US / EU only. We'd be interested to explore that option, though. Maybe there is a lot of low-hanging fruit. I will contact you next week if it is fine with you.
We believe for-money eSports tournaments will be the next online poker craze allover the world, because it addresses the basic instincs of competition of a generation of (mostly male) gamers that grow older and have more disposable income.
Thanks for offering your expertise.
I can confirm that the parent is on point. Imo, your best bet - if you dont want to give up the Chinese market - would be to raise from a reputable Chinese investor. Without that you wont have much pull with any partner you find in China and they will happily stall and then copy your stuff. That is completly "fair game" to them and most wont even comprehend what your trying to tell them - a bit like the guy telling you that he admires/like what you've done after you asked him why they copied your stuff as-is...
If you want to chat feel free to contact me, email in profile.
All of the work they did creating the clone becomes transformed into the work the real owners would have to do translating and proving the idea of a Chinese version to themselves or investors.
Sort of a jui jitsu move.
Jui jitsu can go both ways.
As for cloning your site into Chinese it's probably harder than you think and even still your site could be blocked with the right payoff to the government. When I was managing bitbucket.org a Chinese company approached us to license the technology and setup a mirror in China -- we refused and almost immediately bitbucket.org was blocked in China. A few weeks later a clone of bitbucket.org showed up with far less features.
It took many months of effort, however after working with the Australian Embassy and several lawyers to contact the Chinese government we were able to file a position with the Ministry of Technology (or Information, cannot remember exactly) and then a few days later our site was unblocked.
After it was all said and done, in the end we decided to focus on markets that are more approachable (western) since we could better service those markets as they matched our identity better.
I'm curious, why do you think this happens?
Maybe the most efficient measure you can do with your scarce startup resources is to treat them as a competitor and enter the chinese market earlier if it's practical. If someone makes their own VRBO or AirBNB website for china and choose to make their own logo and standard web design, are they an AirBNB clone or competitor?
I can replicate your business 100% and I'm not in China. What are you going to do?
Several other projects tried to do it, and we currently have some SV VC-fueled competitors. But I don't think they have the roadmap we do.
Funny thing is we spent the better part of last year VC-shopping and everyone passed on us. Some shit VC from Berlin forwarded all info to the CEO of EU's largest eSports business and they all said our business idea sucks.
So until some college buddy of a VC has the same idea and gets easy money (I'm looking at you USV) the whole pay-for-money thing still has to grow.
From a technical perspective the implementation of user-friendly real-time tournaments was really hard to get right and can't easily be copied.
So you have your "secret sauce" (that is real-time tournaments). You just need to make your design not to be plain bootstrap so that it does look like you cloned somebody's else website.
[1]: http://www.investopedia.com/ask/answers/05/economicmoat.asp
He's just asking around to find what his options are.
[1] https://news.ycombinator.com/item?id=11458359