For Chinese Tycoon, Solar Power Fuels Overnight Wealth
Shi Zhengrong Studied Abroad,
Then Founded Suntech
In Partnership With State
Debuting at No. 1 on Rich List
WUXI, China -- When he arrived in Australia 18 years ago as a physics student, Shi Zhengrong scraped by on a meager stipend from the Chinese government that he supplemented by working at a restaurant.
A doctorate, several patents, two solar-power companies and a $455 million initial public offering later, Dr. Shi is now one of the richest people in China.
Suntech Power Holdings Co., the company he founded in 2001 in the flat, green lands of the Yangtze River Delta, has quickly become one of the world's largest producers of photovoltaic equipment, which converts sunlight into electricity. The company's combination of first-world technology and developing-world prices has helped it gain market share from more-established, and expensive, producers.
Dr. Shi's wealth, made up almost entirely of his holdings of Suntech stock, has fluctuated in value along with company's volatile share price, from a low of about $1.3 billion to a peak of just over $3 billion; his stake currently is valued at around $1.7 billion. It is, by some estimates, the largest private fortune of anyone living in mainland China.
The story of his journey from China to Australia and back shows how important China's growing openness has become to its people. Nearly three decades after market reforms began, the network of personal, educational and financial ties between China and the rest of the world is reaching a new level. And the Chinese government's willingness to underwrite both advanced education abroad and technology startups at home is starting to pay dividends.
Close to 800,000 Chinese students have gone abroad since the government first started sponsoring them for overseas study in 1978. Drawn by job opportunities overseas, less than a third have come back so far, but the rate at which they are arriving is accelerating. Last year, about 35,000 students returned, three times the amount in 2000, according to official statistics that almost surely underestimate the real number.
Many of those returnees, armed with cutting-edge technical and managerial skills, have helped kick-start new technology businesses. At the same time, foreign venture capitalists are flooding the country with unprecedented amounts of money, and Chinese companies are finding they can raise money from stock offerings abroad. Combined with the heady opportunities from an economy expanding at 10% annually, the result has been the creation of private wealth on an unprecedented scale.
There are now probably 320,000 U.S.-dollar millionaires in China, according to estimates by Merrill Lynch and CapGemini, and many of them are newly minted. On a list of the 500 richest people in China, compiled by the Chinese-language New Fortune magazine, nearly one-quarter appeared on the list for first time this year -- including Dr. Shi. He debuted this year at No. 1.
Good Timing
A small, intense man with a round face, Dr. Shi admits to having no real hobbies and speaks often of the importance of focus and hard work. Yet he credits good timing for many of the changes that have brought him so far from his childhood on a Chinese farm.
"I got into the solar industry, in the beginning, by accident," says Dr. Shi. The 43-year-old came of age in China at a time when the government controlled where people worked and lived. "In our generation we didn't have the freedom to choose. We just accept whatever we are given. So it's hard to plan," he says.
Yet Dr. Shi has also shown a knack for challenging the status quo. His plan to start a solar-power company in China drew skepticism from colleagues, but he managed to obtain government funding. Though trained as a scientist, he put aside technical perfection to find cheaper manufacturing techniques. Despite many years of absence from China, he has shown surprising savvy in local politics, convincing his original government backers to sell out before the IPO that made him a rich man.
Suntech's success has come from its ability to tap into the global boom in solar power, not from the Chinese market, which remains small. Industry executives estimate that about 90% of the solar equipment produced in China is sold elsewhere, usually to countries such as Germany and Japan that offer generous incentives for solar use.
Suntech faces competition from deep-pocketed large firms such as Japan's Sharp Corp. and Kyocera Corp., and the solar division of oil-and-gas giant BP PLC. Suntech is bulking up quickly to try to ride out any industry consolidation, and building global connections.
Dr. Shi, who switches easily between Chinese and English, keeps close ties to Australia. He sits on the international advisory board of the New York Stock Exchange, where Suntech's stock trades.
He is living once again in his birth province of Jiangsu, on China's prosperous eastern seaboard. His home, and Suntech's base, is not far from his birthplace on an island in the Yangtze River called Yangzhong. As the oldest of four children, Dr. Shi was the focus of his parents' hopes for a better life through education. Though mainly agricultural, Yangzhong was blessed with a good school system.
He headed to college in 1979, shortly after the universities had reopened after the chaos of the Cultural Revolution, and as a new leader named Deng Xiaoping had begun to break down China's isolation. His high scores in math and physics got him slotted into the optical-science department at Jilin University, in China's chilly northeast.
He found working in a lab preferable to working in the fields. He focused on improving his English so he could read scientific materials. He would study while standing in line at the school cafeteria, memorizing vocabulary scribbled in a notebook.
After graduating in 1983, he entered a master's program at the Shanghai Institute of Optics and Fine Mechanics. The institute had access to a small quota of coveted government-sponsored spots for overseas study. Although he was told he could go to the U.S., that turned out to be a bureaucratic mix-up. He wound up in Australia instead. In 1988 he enrolled in the physics department of the University of New South Wales, in Sydney.
At the end of his one-year program, Dr. Shi realized he didn't want to return to China. The year 1989 was a dark time, as the Chinese government brutally put down the demonstrations in Beijing's Tiananmen Square. A classmate suggested he head to the engineering department, where Martin Green, a prize-winning specialist in solar power, was looking for students with a background in optics.
Though he had no experience in solar-cell research, Dr. Shi talked his way into getting funding to do a doctorate under Dr. Green. And in his first six months, Dr. Shi made some breakthroughs, often working alone well into the night. Finishing his Ph.D. in 1992, he ultimately became research director in a company founded to market some of the lab's technologies. He gained citizenship and bought three houses with savings from a generous salary. Mr. Shi, his Chinese wife and his two Australia-born sons settled into a comfortable life -- but he felt he could do more.
Then, over dim sum one day at a restaurant in a Sydney suburb, he heard of opportunity from an unexpected quarter. Samuel Yang, a businessman from his hometown of Yangzhong who regularly traveled to Australia, told Dr. Shi that the gray, regimented China he remembered had changed. It was booming, attracting billions of dollars of foreign investment, and recruiting overseas Chinese with technical skills to come back home.
In April 2000, Dr. Shi went to China to see for himself. He came back to Australia afire with ideas for a China-based solar-power company, and sat down and put together a 200-page business plan. It was the first thing he had written in Chinese for years. "That conversation was at the right time," Dr. Shi says. "If that conversation had occurred two years or three years earlier, I don't think it would have happened."
Dr. Shi shopped his proposal to several Chinese cities with ambitions to attract high-tech businesses. Wuxi, a fast-growing city near Shanghai, offered $6 million as a start-up investment. Government funds and state companies would own 75% of the company, and a local official would serve as chairman. Dr. Shi would put in the technology he owned and $400,000 of his own money for a 25% stake, and get a free hand to run the company. He agreed, and Wuxi Suntech Power Co., as it was then called, was registered on Jan. 21, 2001. The company's Chinese name, "shang de," is a reference to a traditional saying meaning "upholding virtue."
Tackling New Problems
Dr. Shi now found himself tackling problems outside of science: making payroll and occasionally browbeating suppliers into accepting late payments. His biggest puzzle was finding ways to grow on a shoestring budget. The company started producing in September 2002, but by April 2003, it had sold its entire inventory and needed to expand further.
It was under these pressures that Dr. Shi came up with his signature innovation, which he likes to call simply "low-cost expansion." After having used mainly expensive imported parts to build Suntech's first production line, he couldn't afford to buy another one off the shelf. The only way out was to come up with a cheaper design.
"Coming from a scientist background, I always pursued high efficiency, as high as possible," he says. Instead, Dr. Shi reorganized the manufacturing process to reduce automation, taking some processes from machines and putting them into the hands of workers, who in China were cheaper. He cobbled together parts from different suppliers, including little-known Chinese companies. He bought used gear from an Italian laboratory and new equipment from a Japanese startup.
The new line was ready in December 2003, just in time to catch a boom in the global solar-power market. Suntech's revenue zoomed to $226 million last year, from just $14 million in 2003. First-half revenue this year was $218 million. Suntech's cost advantages have endured: It is now selling its solar modules for $3.78 per watt, well below the average global market price of $4.30 estimated by Photon Consulting.
"His timing has worked out perfectly," says Dr. Green, Dr. Shi's former academic adviser.
By 2004, Suntech's government owners had also taken note of Suntech's improving fortunes, and wanted a more active role in the company. That put chairman Li Yanren, the government's representative, into conflict with Dr. Shi. The internal strife consumed several months, but eventually the board threw its backing to Dr. Shi, making him chairman as well as chief executive. Mr. Li, who received a compensation package upon leaving, declined to comment.
That was a turning point. It had become clear that Suntech's combination of government capital and private management was no longer ideal. "The Chinese shareholders couldn't provide a lot of support. They were just having meetings," says Zhang Weiguo, a Suntech director who previously ran a Wuxi government venture-capital fund.
Dr. Shi wanted new backers from overseas who could put Suntech on the road to becoming a public company, but it wasn't easy to explain this to the founding shareholders. Mr. Zhang says it's not hard to see why: "I have helped you through so many difficulties, and now that you are starting to make money you push me out?"
Dr. Shi argued that getting the state shareholders out of the company would allow Suntech to grow faster, hire more people and pay more taxes. That swayed city government officials, who helped Dr. Shi work on convincing the corporate shareholders. Here, Dr. Shi's willingness to offer generous terms helped. Mr. Zhang says his old fund made a return of 20 times its initial investment.
After six months of negotiations, the shareholders, which included appliance maker Jiangsu Little Swan Group Co. and pharmaceutical firm Wuxi Shanhe Group, agreed to take their money and step aside. In May 2005, an $80 million sale of shares to venture capitalists, including Goldman Sachs Group Inc., financed their exit.
Once again, Dr. Shi's timing was good. With oil prices hitting new highs and solar-panel sales booming, the buzz in the financial community over alternative energy was becoming a roar.
Suntech's investors saw their enthusiasm for solar power validated with the October IPO of Q-Cells AG, a Suntech competitor in Germany. The rapturous market reception convinced Suntech's bankers, Credit Suisse Group and Morgan Stanley, to rapidly push through an IPO. On Dec. 14, 2005, Suntech debuted on the New York Stock Exchange. The company was valued at more than $5 billion at its peak stock price, though that has since come down substantially.
Dr. Shi hasn't left his academic past behind. His office is piled with technical papers and decorated, if that's the word, with photographs of silicon crystals. He can still unconsciously switch to a professor's chalkboard style when he has to explain technical concepts.
He has already started giving his money away, an unusual move in a country where private philanthropy is largely undeveloped. Recently his family trust gave donations to a nursing home and a school in Shanghai. For now, however, his main focus remains on the business. Having just bought a company in Japan, Dr. Shi says his goal is to turn Suntech into a true multinational.
"The time is right, the soil is rich," he says. "Now, there's already a lot of Chinese dreams being realized. And I think there are a lot more to come."
“海归”成就中国梦
十八年前，施正荣靠政府提供的一份微薄奖学金到澳大利亚公派留学，课余他还要到餐馆打工以贴补生活。
如今的他拥有了博士学位、数项专利以及两家太阳能电力公司，他的企业首次公开募股筹得4.55亿美元，并在纽约证交所上市。他的名字也上了中国的富豪榜。
他于2001年在到处充满绿色的长江三角洲平原上创建了尚德太阳能电力有限公司(Suntech Power Holdings Co.)，现已迅速成为世界最大的光伏设备制造商之一。这种设备用于将太阳能转化成电能。该公司在拥有世界最新技术的同时，又充分利用了中国作为发展中国家所具有的成本优势，这让它轻松击败一些产品更出色但价格昂贵的生产商，在全球市场独占鳌头。
施正荣的个人财富几乎全部凝聚在尚德的股份上。随着尚德股价的起落，他的身家也在顶峰时的30亿美元和低谷时的13亿美元左右之间起伏。目前他的持股价值17亿美元。有人估计，以这个数字排名，施正荣可能是中国大陆的首富。
施正荣留学海外继而归国创业并获得巨大成功的历程表明，中国的日益开放给中国人带来了前所未有的重大机遇。近三十年的改革开放让中国和世界在人员、教育和金融等领域的联系达到了一个新高度。中国政府支持人们出国留学并回国创办高科技企业的政策正开始产生回报。
自从1978年中国政府向国外派遣留学人员以来，有800,000中国学生负笈海外。他们后来大多被外国的工作机会所吸引而留了下来，学成回国的（即所谓“海归”）不到三分之一。不过，现在回国的人正越来越多。官方的统计数字显示，去年回国的人大约有35,000，是2000年时的三倍。实际数字极有可能不止于此。
许多掌握了最新技术和管理技能的归国人员纷纷在创建科技企业方面大显身手。与此同时，外国风险投资家也携巨额资金涌入中国。中国企业还发现，他们可以在海外上市融资。正在以每年10%的速度迅猛增长的中国经济为这些归国人士带来了大量机遇，他们也藉此创造出了规模空前的个人财富。
据美林公司(Merrill Lynch)和CapGemini提供的数字，目前中国有大约32万名资产额超百万美元的富豪，其中许多人是近年涌现出来的。在中文杂志《新财富》编制的中国500富豪排行榜上，有四分之一的入选者是今年第一次上榜，其中就包括施正荣。而他初次入选便高居榜首。
身材瘦小的施正荣生着一副圆脸庞。他是个感情丰富的人。他说，自己没有什么真正的爱好。他经常会提到专注和勤奋工作的重要性。不过他认为，自己之所以能从一位乡村少年走到今天，很多时候是因为机遇比较好。
今年43岁的施正荣说，自己进入太阳能行业非常偶然。在他成长的时期，中国还处在计划经济时代，人们不能自由选择工作和居住的地方。“我们那代人没有选择的自由。给我们什么，我们就只能接受什么。个人很难有什么规划，”他说。
不过，施正荣身上还是有挑战现状的血液。当初他准备创办一家太阳能企业的想法就招致了同事的怀疑。不过他依然设法搞到了政府扶持资金。虽然接受过正规的科学教育，不过他还是放弃了技术追求完美的偏好，而选择低成本的制造技术。他多年不在国内生活，但对中国的政治生态仍表现出惊人的洞察和把握能力。在尚德去年底赴纽约证交所上市前，他成功说服当地政府转让出了在该公司的股份。
尚德的成功得益于它抓住了全球范围的太阳能应用热潮。实际上中国国内的太阳能市场规模还很小。据业内人士估计，中国生产的太阳能设备大约有90%出口到外国，主要是德国、日本等鼓励使用太阳能的国家。
尚德的竞争对手中有一些财大气粗的国际公司，如日本的夏普(Sharp)、京瓷(Kyocera)，以及英国石油(BP)旗下的太阳能子公司。目前，尚德正在迅速壮大，它希望能顺利度过行业整合期，构建起自己的全球网络。
能说一口流利英文的施正荣与澳大利亚保持着密切联系。他现在还是纽约证交所的国际顾问委员会成员。
祖籍江苏的施正荣又回到了家乡。他现在的居住地以及尚德公司的总部离他的出生地扬中很近。他是家中四个孩子里的老大，父母一直对他期望很高，希望他好好念书将来有出息。扬中这个地方虽然比较偏僻，但那里的教育水平并不低。
一九七九年，中国结束“文革”后刚刚恢复高考制度不久，施正荣考上了大学。他的数学和物理分数很高，因此被录取到吉林大学光学系就读。
他发现在实验室工作比干农活要好受多了。为能轻松阅读研究资料，他在英文上下了很多功夫，在学校餐厅排队买饭的时候也会抓紧时间背单词。
毕业后，他考进了上海光学和精密仪器研究所攻读硕士学位。这家研究所有几个公派出国留学的名额。起初研究所告诉他可以去美国学习，但后来不了了之。最后他去了澳大利亚。1988年，他进入位于悉尼的新南威尔士大学物理系就读。
为期一年的学习结束后，他感觉不想回国，当时也正是中国政治生活中的一段黑暗时期。一位同学建议他再到工程系看看，该系的太阳能专家、诺贝尔奖得主马丁?格林(Martin Green)正在物色有光学背景的学生。
虽然施正荣之前在太阳能电池研究方面并无任何经验，但他还是设法说服有关方面提供给他在格林门下攻读博士学位所需的资金。他很用功，经常独自一个人钻研到深夜。短短6个月的时间，他就取得了一些突破。在1992年拿到博士学位之后，他在一家公司谋到了研究主管的职位，这家公司主要从事推广实验室技术的业务。
后来施正荣取得了澳大利亚国籍，并凭藉优厚的薪水买下了三栋房子。他和太太及两个在澳大利亚出生的儿子过上了安定而舒适的生活。不过，他感到自己还可以做得更多。
后来有一次他在悉尼郊外一家餐馆跟来自扬中老家的同乡Samuel Yang喝茶的时候感觉到了机会。Yang是位生意人，经常到澳大利亚出差。他告诉施正荣，如今的中国跟他记忆中的那个灰暗的、什么都要受管制的时代已经不一样了。中国经济正在起飞，每年都能吸引数十亿美元的外国投资，政府也欢迎有技术专长的海外华人回国效力。
施正荣决定回国看个究竟。2000年4月他回了趟国，返回澳大利亚时，满脑子都是在中国办一家太阳能电力公司的想法。他立即着手整理了一份200页的商业计划书。这是他很多年以来第一次用中文写东西，施正荣回忆当年的情景时说：（跟Yang的）那次谈话正是时候。如果是早几年，我想也不会有后面的事。
施正荣后来到国内几个城市“推销”他的建议，希望能吸引到高科技企业。邻近上海的江苏无锡市愿意向他提供600万美元的启动资金。当时无锡市还提出，由政府和国有企业在新公司持有75%的股份，董事长由政府派官员担任。施正荣以自己的技术及40万美元自有资金获得公司25%的股份，并可全权负责公司的经营。施正荣同意了这个安排，新公司（当时的名称是“无锡尚德太阳能公司”）于是在2001年1月21日注册成立。
施正荣目前要处理的问题基本已和技术无关：有时他要考虑员工工资问题，偶尔他还会软磨硬泡地说服供应商允许公司推迟付款。他最发愁的是如何在预算有限的情况下扩大业务。公司是2002年9月开始投产的，到2003年4月的时候，库存就销售一空，急需进一步扩大生产。
在这种压力之下，施正荣想到了他那有名的、被他自己称为“低成本扩张”的模式。尚德的第一条生产线是花高价从国外进口部件组装的。尚德此时已无力再如法炮制。唯一的出路是重新设计一条造价较低的。
施正荣说：我是学技术出生，所以总是喜欢高效率，越高越好。当时施正荣重新调整了生产工艺，减少了自动化生产工序，转而用在中国成本很低的手工劳动替代。他将来自各家供应商的零部件组合在一起作出自己的产品，有些供应商在中国根本名不见经传。他从意大利一家实验室购买二手设备，也从日本初创公司购买新设备。
到2003年12月，新生产线大功告成，正赶上全球太阳能市场的繁荣期。去年，尚德的销售收入从2003年的1,400万美元猛增到2.26亿美元，今年上半年的收入就达到2.18亿美元。尚德的成本优势也经受住了考验。目前，其单位功率制造成本是3.78美元，而据Photon Consulting的数字，全球市场的平均成本是4.30美元。
施正荣以前的导师格林说：他的时机把握得非常好。到2004年，尚德的良好业绩引起了公司国有股东的注意，他们开始想介入公司的经营。国有股代表人、董事长李延人因此开始与施正荣发生冲突。内部不和的状态持续了好几个月，最后，董事会站到了施正荣一边，施正荣在担任首席执行长的同时又夺过了董事长的位子。李延人在得到补偿后离开了公司。他不愿就笔者的有关问题发表评论。
这件事之后，尚德也发生了转折。很明显，尚德这种政府资金加私人管理的模式已不够理想。尚德董事会成员张维国说，中方股东提供不了什么支持，他们只是开会。张维国以前负责无锡市政府下面的一个风险基金。
此时，施正荣需要来自海外的支持者帮助尚德走上海外上市之路。但这一点不太好开口向出资股东解释。张维国说：这很好理解。出资股东会想，我帮你度过了那么多的困难，现在你赚钱了就要把我一脚踢开？
施正荣认为，让国有股东脱离公司将有利于尚德加快发展、聘用更多人员、增加对国家的纳税。这些理由打动了无锡市官员，他们帮助施正荣说服其他参股企业。而施正荣开出的优厚条件也起到了很大作用。张维国说，他以前所在的那家基金从尚德公司获得的投资回报是20倍。
经过6个月的谈判，参股企业（包括电器企业江苏小天鹅集团(Jiangsu Little Swan Group Co.)和制药企业无锡山河集团(Wuxi Shanhe Group)）同意出让股份。
去年5月，包括高盛(Goldman Sachs Group Inc.)在内的几家风险投资公司接盘，他们为这些股份支付了8,000万美元。
而施正荣这次又抓住了一个好机会。随着油价高企，太阳能电池板市场一片兴旺，金融行业对替代能源企业大力追捧。
去年10月，尚德的德国竞争对手Q-Cells AG首次公开上市，这让尚德的投资者信心大增。市场的热烈回应促使尚德的投资方瑞士信贷(Credit Suisse Group)和摩根士丹利(Morgan Stanley)加快了尚德的上市步伐。去年12月14日，尚德在纽约证交所上市，其后尚德的市值曾一度超过了50亿美元。
施正荣并没有完全放弃他的技术本色。他的办公室里堆了很多技术资料，就连装饰（如果能称得上是装饰的话）也是硅晶体的照片。在解释一些技术概念的时候，他还会下意识地像教授那样写写画画的。
他还开始将自己的钱投向慈善事业。在中国这样一个缺乏慈善传统的社会，这种做法很不寻常。最近，他的家庭信托基金向上海的一家养老院和一所学校捐助了款项。不过，他目前的主要精力还是在生意上。施正荣说，他的目标是让尚德成为真正的跨国公司。最近他刚刚在日本收购了一家企业。
他说：现在具备了天时、地利。中国人的很多梦想眼下正在实现。我相信后面还会有更多梦想变成现实。
Andrew Batson
