Chinese entrepreneurs will lead the next revolution in global business

Many people outside China still view the country in a very narrow sense, as a nation with a one-party authoritarian regime where the economy is dominated by large state-owned enterprises. Though it remains true that the country's biggest companies - its major banks and insurers, oil and energy companies, telecom operators, airlines and leading steel, auto and construction firms - are all government-owned or controlled, the often-overlooked private sector is where China's largest source of growth resides.

There are about 2.3 million state-owned companies in China today, a staggering-sounding number, but not when you compare this to the total number of businesses. In 2013, the country had more than 12 million private companies and more than 42 million proprietorships.

In 2000, total revenues earned by state-owned and non-state-owned industrial companies were roughly the same, at about 4 trillion yuan (HK$4.6 trillion then) each. By 2013, while total revenues at state-owned companies had risen just over sixfold, those in the non-state sector had risen by more than 18 times.

Increases in profits were even more impressive over the same period: up nearly seven times for state-owned companies, but up nearly 23 times for non-state ones. Like it or not, Chinese entrepreneurship is growing in leaps and bounds.

The rise in Chinese entrepreneurship can be seen as four distinct waves. The first one came in the 1980s soon after Deng Xiaoping started economic reform in 1978 and included companies like Huawei and Legend (the precursor to Lenovo).

The second wave was in 1992, after Deng went on his now legendary "southern tour". This wave lifted the companies established in the first wave and also served as a launch pad for many others. A number of former government officials decided to xia hai (jump into the sea) to become businessmen, forming the so-called "Gang of '92".