China AI boom is creating a new type of entrepreneur - Rest of World

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By Lin Zhang

7 July 2026

Ideas

China’s AI boom is creating a different kind of entrepreneur

By Lin Zhang

Ideas

Arguments, opinions and essays from a global perspective.

Involution — neijuan (内卷) in Mandarin, literally "inward curling" — entered everyday Chinese speech around 2020. The concept was borrowed from the American anthropologist Clifford Geertz, who described a pattern in colonial Java in the 1960s: farming systems that grew more elaborate and complex without becoming more productive, absorbing ever more labor for diminishing returns.

Chinese internet users repurposed the term to describe something they recognized in their own lives — a social dynamic in which everyone works harder and harder, competes more and more intensely, yet no one actually gets ahead, because all that effort simply raises the baseline that everyone else must now meet.

In China, where decades of rapid growth have begun to slow, where graduate degrees no longer guarantee stable employment, and the housing ladder that once promised intergenerational mobility has become unclimbable for many, neijuan gave a name to a collective feeling that had long been present but lacked a word: the sense of running faster and faster just to stay in the same place.

In the years since Covid-19, the group I call "entrepreneurial workers" — digital laborers who are neither traditional employees nor true owners of capital — is becoming a force in the Chinese labor market. Compared to the wave of mass entrepreneurship and innovation in the mid-2010s, defined by opportunity and upward mobility, the entrepreneurial workers of this decade are caught between starting a business and working for someone else.

This new wave of micro-entrepreneurship is built on AI tools: Some people are using generative AI to write copy, create designs, run e-commerce, or produce short dramas; others are attempting, through podcasts, independent coffee shops, blogs, and small-scale creative industries, to reassemble their relationship with work and life.

If the entrepreneurial workers of the 2010s were born at the intersection of platform expansion, capital frenzy, and technological optimism, then those of 2026 are the product of a declining real estate industry, platform maturation, the spread of AI, and the normalization of risk. Both generations reflect the fact that, driven by technological change and the force of capital, labor has become more flexible, the barriers to entrepreneurship have continued to fall, and the boundary between "worker" and "entrepreneur" has grown ever more blurred.

Innovation in China is forged under the twin pressures of external blockade and internal competition."

In contrast to the older entrepreneurial workers who believed that "the harder you work, the luckier you get," the new generation of workers understands that platforms do not necessarily bring freedom, algorithms can cut off your traffic at any moment, AI may rapidly compress the premium on skills. One person is a company, using AI to write copy, create designs, edit video, handle customer service — cutting costs as much as possible, moving as fast as possible, maintaining livelihood and flexibility. They no longer dream of becoming the next Jack Ma; they hope to cover rent, social insurance, and basic living expenses, and to carve out a little room to breathe.

But perhaps because of this, their understanding of the relationship between labor and life may in fact be closer to a kind of post-growth era self-reinvention. They may not have escaped precarity, but they are beginning to ask: When success is no longer only IPOs, buying a home, and financial freedom, what else can labor bear as a life worth living?

And it is precisely in the anxiety and disillusionment of involution, that an experiment in innovation is being reincubated in China.

Unlike Silicon Valley, which is driven by financial capital, platform monopoly, and geopolitical imperatives to sustain technological leadership and capital narratives through continuous fundraising, Chinese foundation model companies including DeepSeek have been gradually feeling out a different path under the constraints of U.S. chip export controls, limited computing resources, and more cautious capital.

They cannot simply replicate the Silicon Valley model of "burn money and pile on compute” — instead, they are placing greater emphasis on finding breakthroughs through model compression, architectural optimization, engineering efficiency, and open-source ecosystems, seeking a way between lower training costs and higher deployment efficiency. This is not simply low-cost substitution; it more closely resembles a form of constrained frontier innovation forged under the twin pressures of external blockade and internal competition.

In this sense, the development of AI in China is not only the result of national industrial...