Dada CTO Jun Yang: Reflections on Critical Questions in Entrepreneurship | Linear Academy

In May, Linear Capital's entrepreneurship learning and sharing platform Linear Academy invited Jun Yang, co-founder and CTO of Dada Group, to share his thinking on critical issues in entrepreneurship with founders from Linear's portfolio. Yang discussed his experiences and ideas on development strategies for startups at different stages, organizational management, founder growth, and how technical teams can work with commercial teams. We've compiled some of the highlights to share.

About the speaker: Jun Yang is co-founder and CTO of Dada. He holds a PhD in Computer Science from Carnegie Mellon University and previously worked at well-known Silicon Valley companies including Google, Facebook, and Square. He joined Dada in 2015.

I. The Key Challenges at 0-1 vs. 1-10

• At the 0-1 stage, the priority is forming a basic judgment about the business model and quickly finding seed customers. In a company's first 1-2 years, you need to think through problems very clearly and develop a judgment about the business model. Then you need to quickly find seed customers and get the product and business running.

• Markets are dynamic — initial customers may not become your core customers, so you need to keep exploring boundaries. Markets are highly dynamic. While finding seed customers, you also need to be mentally prepared that these customers might provide some initial orders but won't necessarily become the ones driving future growth and profit. However, these seed customers can help the company refine its product. The founder/CEO needs to continuously explore customer boundaries. In other words, you need a strong external perspective, constantly iterating yourself, the product, and the company based on market dynamics — even after the company has captured some market share.

• For B2B businesses, the CEO must be the top salesperson, especially for key accounts. When the CEO personally handles sales, it's easier for customers to feel respected. More importantly, by participating in actual sales, the CEO continuously learns market feedback and forms/updates their external perspective. If you don't do this, a common pitfall is that the team will attribute performance fluctuations to the sales team's competence. If the CEO comes from a technical background, personally doing sales is often difficult, but there's no shortcut around this.

• At the 1-10 stage, you need to cultivate the team's business consciousness and reflect this in performance reviews. Early-stage companies often prioritize growth, which is a different mindset from pursuing profit. For long-term development, the company needs a clear profitability timeline, and the entire team needs to strengthen its awareness and desire for profit from top to bottom. The most direct way to do this is to reflect it in performance evaluations.

II. From Startup to IPO: Organization Building, People Assessment, and Team Upgrading

• Early-stage companies need "generalists"; mid-to-late stage needs "specialists" — hire with conscious intent. Few people are both generalists and specialists. Specialists often struggle to accept the high uncertainty of early-stage startups.

• People assessment criteria: competence + willingness + culture. These three points manifest in hiring as follows: competence — can they do the job; willingness — do they genuinely want to do it; culture — can they work with others.

• Bringing in executives is high-risk, but you need to be bold — the opportunity cost of not doing it is high. Hiring executives carries risk. From the start, be prepared for multiple failures. There's a Silicon Valley saying: fail early. That is, if you're going to fail, fail quickly, then start over.

• Core team members must believe in the value of stock/options. This demonstrates whether someone believes in the company's long-term development, and whether they're willing to grow with the company for the long haul.

• Company culture must fit the external market environment. This is especially important for founders returning from overseas. Which market you're in largely determines what your company culture will be, or what range of cultures are available to you. There's no good or bad, only fit or unfit.

• Culture is built through the founder's actions, not slogans on walls. Only when the founder themselves can admit mistakes and tolerate failure can such an atmosphere and culture be created in the company.

III. Advice for Founder/Founding Team Growth: How to Break Out of Your Comfort Zone

• Find a good mentor. Founders or CEOs are often confident people, but having a mentor standing to the side, looking at problems from an observer's perspective, is excellent support. A good mentor needs four qualities: high cognitive level, no major vested interest, mutual trust and understanding, and willingness to speak unpleasant truths.

• Entrepreneurship is against human nature — the right things are usually hard and unpleasant. Most correct things are what others don't want to do. Once you internalize this, you'll find your mindset much calmer when facing difficulties in entrepreneurship.

• Build a leadership team with complementary skills who are willing to speak truth. The founder or CEO themselves must be willing to speak truth and publicly admit their mistakes. Only then can you cultivate a leadership team that's willing to speak truth.

• For CEOs, distinguish between "what I'm good at" and "what the company needs me to do." It's easy for CEOs to "do everything themselves" — this often happens when encountering something the CEO is good at. But you need to distinguish whether this is what the company needs. What a company needs from its CEO is mainly three things: set strategy, find people, find money.

• External perspective is the CEO's full-time job. The company must obtain external perspective through the CEO — understanding the market, the industry, your positioning in the industry, your relationship with competitors, your relationship with customers. This cannot be delegated to others, and is closely connected to setting strategy. If a CEO lacks external perspective, it's difficult to formulate a reasonable strategy.

• Read more, make connections across domains, raise your cognitive level, attend fewer low-relevance events.

IV. Managing and Upgrading Technical Teams from a CTO Perspective, and How to Work with Commercial Teams

The key to managing and upgrading technical teams lies in delegation and providing context.

Delegation means pushing work downward and giving employees room to perform. The best motivation is setting challenges that are difficult but achievable with effort. This requires the management team to provide some coaching while allowing mistakes.

To get technical/product teams to work better with commercialization teams, the most important thing is giving technical teams strong context — why build a product, why build a certain feature. Providing context helps technical teams understand the starting point and meaning of their work. There are many ways to do this. For example, have engineering managers/product managers regularly visit customers and have face-to-face interactions to get first-hand feedback. Additionally, frontline technical staff should use their own products, and the company should hold regular all-hands meetings to maintain information alignment.

PS: Cover image generated by Tiamat

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Linear Capital is an early-stage investment firm focused on "frontier technology + industry" — frontier technologies represented by data intelligence, digital new infrastructure, next-generation robotics, and new technological transformations in traditional sectors (such as biomedicine, materials, energy, etc.), applied across vertical industries to substantially improve industrial efficiency, empower solutions to pain points, and complete industrial upgrading. Through substantial increases in industrial value, we achieve excess returns in commercial value. We currently manage ten funds with total AUM of approximately $2 billion.

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To date, we have made early-stage investments in over 120 entrepreneurial teams including Horizon Robotics, Kujiale, Sensors Data, Tezign, Rokid, Guandata, and Agile Robots. The combined valuation of Linear's portfolio companies is approximately $20 billion.

In the near term, Linear Capital is working to become the best "Data Intelligence Technology Fund." In the long term, we are gradually building toward becoming the most influential "Frontier Technology Application Fund."