Heart Capital's Yan Han: Startup Mindset — How Startups Can "Cross the River by Feeling the Stones" | VOICE

Every river crossed is a journey of the heart.

Entrepreneurship is crossing rivers, clearing hurdles, and overcoming oneself.

| Yan Han, Heart Capital

| 1,800 words, ~4 min read.

Starting a company is feeling your way across a river stone by stone. The far bank promises spectacular views, but the current runs treacherous beneath the surface. Established companies can build bridges and pave roads — they have resources to spare and room for error. Startups have only a handful of critical stones to stand on. Step right, and each foothold blossoms into the next; misstep, and you're swept miles off course.

Over more than a decade, I've seen countless companies come and go. The ones that make it across all grip three things with white-knuckled intensity: performance, talent, and capital. Many treat these as equals, but I want to be unambiguous about their hierarchy — the order of priority must never blur.

Every Step Counts: Neither Too Short Nor Too Long

Each stride forward is never a single-dimensional lunge. Too short, and you never reach the next stone — the business stalls. Too long, and you outpace what your resources can support — you plunge into the current. Performance, talent, and capital must advance in coordinated, dynamic rhythm. Every decision and action across these three dimensions must be precise and well-timed. Cadence is everything.

Among the three, performance is undeniably the foundation and ultimate objective. Yet performance — especially in a company's early and middle stages — often depends directly on the caliber of people you have and the capital coalition you've assembled. These three are interlinked and mutually influential, a dynamic whole.

Early and Middle Stages: The Invisible Battle for Talent and Capital

In the early and middle stages, when business metrics haven't yet achieved absolute persuasive power, the "stone" of performance often lies hidden beneath the waterline. The core strategy for crossing now is to rely on top-tier talent and leading capital as your "searchlight" and "propulsion engine" — helping the company find and reach the first tier ahead of competitors in rushing waters. This is an invisible battle over resource quality.

At this stage, the quality of financing partners far outweighs valuation. A top-tier venture firm, or a strategic investor who can bring orders and distribution channels, lends credibility and resources that dramatically accelerate your path to the next milestone. When forced to choose between "high valuation" and "great partner," sacrificing some valuation for a world-class capital coalition is the wiser move.

The same logic applies to hiring: caliber must take priority over cost. Within a controllable range, costs can flex; excellence is non-negotiable. You need "partners" who will build the future alongside you, not merely employees who execute orders. For example, before a Series A, bringing in a top architect who can define your technical moat matters far more than saving 20% on salary.

Later Stages: Let Hard Numbers Speak

As a company matures, the river's fog begins to lift. The game shifts from "competing on potential" to "competing on tangible business milestones." Now your market share, revenue growth rate, profit margins — these hard metrics become your most solid, most visible stones.

Capital and talent evolve in their roles. Capital shifts from "sending charcoal in snowy weather" to "adding flowers to brocade" — fueling larger-scale market expansion or M&A integration. Talent shifts from "special forces" to building a "regular army" — establishing systematic organizational capabilities to support scaled operations.

Simply reaching this point proves how solidly you laid the two cornerstones of talent and capital early on. They carried you through the most uncertain phase and earned you the right to "let numbers speak."

By now, performance, talent, and capital have formed a powerful flywheel: outstanding performance attracts top capital and talent, which in turn create even more brilliant results. Crossing the river is no longer tentative groping — you're sailing a self-propelling vessel, riding the wind and waves straight to the far shore.

Based on this logic, let's address two common dilemmas founders face:

Q1: Can I demand both a high valuation and top-tier capital partners?

Answer: You can want it, but the probability is very low.

In a company's early and middle stages — especially early on — the company is still a fragile organism. This is a chicken-and-egg problem. Without sufficient data to prove yourself, it's difficult to demand a perfect "have it all" package from the market. Knowing what to prioritize is key — the core strategy should be securing essential resources, letting go of secondary conditions as long as they remain within reasonable bounds.

Q2: Then can I first "go into isolation to build something big," make the metrics look great, and then come out to attract talent and capital?

Answer: Nice idea, but it probably won't work.

The reason: crossing a river is a three-dimensional, integrated process — nearly impossible to advance single-threadedly. Performance, talent, and capital reinforce one another and progress together. Exceptional talent accelerates performance breakthroughs; a strong capital coalition provides not just "ammunition" but also helps attract more talent and safeguards business expansion. Trying to seal yourself off and cultivate strength in solitude risks missing the optimal window — you may emerge to find your "big move" unfinished and the far bank already occupied by others.

Heart Capital was founded in 2022 as an early-stage Chinese venture fund focused on technology and digitalization. The team is led by Yan Han, founding partner of Lightspeed China, alongside core investors, a CFO, and seasoned investors from industry. Past investments include Series A bets on Xpeng Motors (NYSE: XPEV, 09868.HK), Full Truck Alliance (NYSE: YMM), as well as FinVolution (NYSE: FINV), RoboSense (02498.HK), Baichuan, Yunmanman Cold Chain, Fan Deng Reading, World Logistics, Micro-nano Starry Sky, LandSpace, Lanhu, and Starfield. Rooted in China with a global outlook, Heart Capital seeks genuine value in non-consensus. We honor the value of people and champion the potential of the heart, aspiring to accompany more young Chinese entrepreneurs in strengthening China and reaching the world.