Evernote spins off China unit to upgrade services

Evernote, the Silicon Valley-based information organization application, recently announced it has spun off its Chinese unit as an independent entity with full autonomy over its operation and management, in a significant step that will allow it to better approach the local market.

Yinxiang Biji, the China-based service launched by Evernote in 2012, claimed it raised more than 100 million yuan ($15.6 million) in a Series A round of financing from the Sequoia CBC Cross-border Digital Industry Fund, as part of its new move.

Raymond Tang, CEO of Yinxiang Biji, said the ownership of the new Sino-US joint venture is divided roughly equally between Evernote, the Chinese cross-border investor and the new company's management team.

According to Tang, Yinxiang Biji operates as a separate service and will inherit the intellectual property and source code to its app. And Yinxiang Biji and Evernote will continue to work closely.

"We've moved beyond simply localizing the Evernote product in China. Now we seek to be a successful Chinese internet company, meeting the need that is truly distinct to the local market." Tang added.

Evernote Chief Marketing Officer Andrew Malcolm agreed, saying the next logical step for the Chinese team is to control their own destiny financially, technically and from a provision standpoint.

"Our purpose is to meet a global human need to manage a huge amount of information that is coming at us every single day. But the way to fulfill that purpose is different.

"And we've come to realize that more and more as we studied the differences between what Chinese users expect and what the rest of the world might expect."

According to him, the percentage of smartphone users in China who are using personal productivity apps such as Evernote is almost double what it is in the US. And Yinxiang Biji users create about 50 percent more notes than Evernote users in the rest of the world.

After six years of development, Yinxiang Biji says its Chinese users have now increased to tens of millions, creating a total of more than 1 billion notes. Now China has become Evernote's second largest market in the world.

China's 753 million mobile internet users and the rapidly booming knowledge economy in the country are the main reasons for both Evernote and Yinxiang Biji to have such confidence in the local market.

Eric Xu, partner of Sequoia CBC Cross-border Digital Industry Fund, said the future growth of Chinese internet firms will be powered largely by innovation in technologies and products, and Silicon Valley has accumulated lots of related experience.

"Evernote has mastered several cutting-edge technologies, such as artificial intelligence and marketing analytics. The joint venture framework will take the leading technologies and products from Evernote to better cater to the Chinese market," he said.