In contemplating a career, 31-year-old Yan Yan chose to follow his feet. “I wanted to dance,” he said. “I knew that’s what I wanted to do with my life.”

Today he’s trying to forge a business from dance, using the Internet to gain customers. Like most start-ups, Yan is facing obstacles.

He tried to get 100,000 yuan (US$16,129) grant from Shanghai Technology Entrepreneurship Foundation and he established a website to promote his dance company, but both attempts failed. He tied up with famous television announcer to develop a dance network, but had to go it again solo when disagreements between the partners arose.

“I know how to dance, but I don’t know the Internet well,” he said. “I didn’t know how to attract users online.”

He was about to quit his entrepreneurial dreams and take a job offer from Shandai Game Ltd in 2012, when Innospace, backed by developer Shui On Land, delivered an olive branch.

It offered Yan start-up capital of 100,000 yuan, an office with six-month free rental, connections with successful start-ups and legal advice.

With the assistance of veteran entrepreneurs introduced to him by the Shanghai-based incubator, Yan mapped out a new business plan. He targeted dance beginners, offering to show them skills online and building a community of those who were interested. Then he built his own staff of about 20 people to work on a new app product for smartphones.

The product, called Tiaoba, or “Let’s dance,” gathered several hundred thousand registered users in less than six months and secure “angel” investments from Chinese technology giants like Alibaba Group and Tencent Inc.

“This is different from running a business that makes money,” Yan said. “What we are about is creating new things.”

Yan is among a budding population of young entrepreneurs in Shanghai, stoked by Premier Li Keqiang’s call for supportive local policies to “encourage people to do creative businesses and drive innovation.”

Since start-ups begin with big dreams and often fail from poor execution, the Chinese government is encouraging the creation of more incubators to provide environments where entrepreneurs can seek help and thrive.

In Yan’s case, besides the physical and financial supports provided, Innospace also gave a package of four-month training courses, which includes mentorship match, market promotion, recruiting, equity investment and policy guidance in its accelerating plan.

Innospace’s belief

The incubator had thus hold three rounds of accelerating to help nearly 30 programs since 2012. For the next step, the incubator will establish its own angel fund of 40 million yuan to discover more promising programs.

Shao Jie, manager of Innospace, believed that nurturing system would play a bigger role under a golden era of start-ups, as the successful example in the U.S. had the same.

According to a recent survey carried out by consulting firm Accenture, the nurturing and a peer network participating atmosphere are among the crucial reasons for Silicon Valley being the world’s leading high-tech powerhouse.

The network subculture connected between incubators and start-ups are so strong that it can attract most talented engineers to join the “California dreaming”, the survey said.

Shao eyes the Innospace to be an important part of the ecosystem for China’s innovation business as its counterpart did in the U.S. In his mind, Silicon Valley can be imitated in Shanghai by its own way, using the fittest mentorship resources to match with the most suitable program and give the capital support in the best timing he could.

“We want to follow the style of Y Combinator in the Silicon Valley and gather more resources to help our start-up programs get a higher business return,” Shao told Shanghai Daily.

With Chinese government preferential policies, programs to help start-up entrepreneurs are mushrooming in major cities like Beijing, Shenzhen and Shanghai. Beijing’s Zhongguancun Avenue – sometimes called “the Silicon Valley of China” – bears witness to the fruits of those efforts.

China aims to create 1,500 incubation centers across the country, with investment of more than 5 billion yuan, the Ministry of Science and Technology said in an industry blueprint for the innovation sector.

Shanghai is playing its part by stepping up efforts to become a global technology innovation center by 2020. The city has initiated 22 measures aimed at furthering that goal, including providing incentives for domestic and foreign talent to come to the city and supportive tax policies.

The Shanghai approach

The idea was fully supported by city’s officials. Party secretary Han Zheng said in May that the city government should be the servant in case of innovation rather than a referee to making rules. While Chairman of Shanghai Development and Reform Commission Zhang Suxin said earlier in June that Shanghai government had doubled the size of its angel investment fund for new businesses to 1 billion yuan.

Despite all the hoopla, Shanghai’s incubation efforts need to improve as it still fall shy of similar programs in Beijing and Shenzhen, which have siphoned off talent and funds. The reason might come from a more separated hub structure for different innovation areas in the city, which is hard for start-ups to accumulating what they want in one place.

“We appreciate the support by the city government but still feel that I’m lacking mobile Internet talents when running Tiaoba,” Yan said. “I’m trying to hire people from Beijing and Hangzhou and hope more favorable policies or Internet giant companies will boost the system in the town.”

Shao said he doesn’t think Shanghai is a less competitive place for innovative entrepreneurs in China due to its special structure, though did admit that Innospace needs to do more on specified matching on high-profile mentors to thrust the sector.

Zhou Wei, chief executive officer of the newly established X•Node, said Shanghai’s incubators wouldn’t be left behind if they give their potential full play.

Inspired by government’s strong back up, the new comer has established a 100 million yuan foundation to provide a one-stop service and mentor-driven model for start-ups, which is among the rising leading incubators in town.

“The key is to take advantage of Shanghai’s strength in finance and a strong cooperation to the outside world,” Zhou said.

Shanghai should draw lessons from successful models from Silicon Valley, as well as those rising technology hubs in the neighborhood, Zhou added.

Taking a broad view of the innovation sector in Asia, Singapore and Seoul in South Korea are already leading the bandwagon in the area, with advanced systems and abundant capital investment that showed their determination that don’t want to be left out of the global drive for innovative technologies.

Singapore, with a population of just 5.4 million, increased its venture funding for the technology sector last year to US$1.7 billion from US$27.9 million in 2011. While that lags behind China’s US$3.46 billion investment, it is ahead of Japan’s and South Korea’s, according to data from Hong Kong-based Asian Venture Capital Journal.

Seoul has four major incubators in its central Gangnam district, creating a vibrant environment and helping more start-ups to market success.

Financed by a US$5 billion initial investment from Dream Bank, Seoul’s incubator D.Camp was the first of its kind in the Korean capital. It has helped 1,590 fledgling companies in the last three years, attracting more than 30 percent of South Korea’s start-ups in the hub city.

“D.Camp took nearly three years to gather its network together and establish its reputation in and outside the country and China is sure to follow the step,” Kwanghyon Kim, executive director of D.Camp, told Shanghai Daily in a technology conference held in Shanghai last month.

In terms of market scale, most incubator managers in China remain optimistic amid this nation’s increasing emphasis on innovation. The success of Singapore and Seoul incubators will be nothing compared with China when it is fully up to scratch, they predict.

“A second Silicon Valley could be anywhere,” Kim said, “But it’s important for an innovative hub to develop its own innovative version.”