Rupert Varnai of Cathay Group tells us about bridging China with the rest of the world and the impact of Covid-19.
First of all, how are you and your family doing in these COVID-19 times?
Rupert Varnai: Our group made a decision in early 2019 to set up a base in China, meaning the family and me moving to Shanghai. Before that, I was constantly on my way between China and Europe for years, and setting up a second headquarter was an organic next step.
We opened our Shanghai office in September 2019; we were done with all the business and family-related to-dos that such a move entails by around the end of 2019, ready to start, and then the Covid hit China heavy.
A new country, a new culture, a new lifestyle from both a business and a family point of view combined with the first shocking changes that the Covid related restrictions brought to our life.
And then, we found ourselves from living in the only Covid impacted country to live in the safest country in the world from a pandemic point of view – with the economy totally back on track and life almost fully back in normal mode.
So, on both a personal and business level, we cannot complain at all from here but are, of course, super worried about family, friends, and colleagues back home and all around the world.
Tell us about you, your career, how you founded Cathay Group.
Rupert Varnai: Cathay was established after almost decade-long work as a strategic partner for a giant Chinese firm. We co-founded the group with a few close friends and partners who all believed in the same initiative: bridging China with the rest of the world as there is still a long way to go due to the language barriers, cultural and business mindset differences.
How does Cathay Group innovate?
Rupert Varnai: I would not call it direct innovation: we are trying to cope with the speed of light digitalization of the Chinese economy and harmonize the „older school” or more traditional Western way of thinking and solutions into the Chinese e-ecosystem helping Chinese companies to go abroad and Western ones to enter the Chinese market.
This means that almost all of our solutions are WeChat-based, and we keep on bringing all of the Cathay members worldwide up to speed in terms of the Chinese way of thinking, expectations, business making.
The one-stop-shop solution that we are providing had to be also tailor-made for China: in addition to the conventional business legs, such as legal, tax, accounting, and IP, we need to be experts in HR, customs, marketing communication, logistics, and countless other ancillary areas as you can only be successful in China and with China if you are capable of providing 360 degrees turnkey solutions.
How the coronavirus pandemic affects your business, and how are you coping?
Rupert Varnai: Actually, there is more demand for our services during the lockdown than ever: as much as China is speeding into becoming fully digital, the traditional values of business making are still there – the get to know each other in person, the build-up the trust, the let’s meet face to face and be friends before we talk about business.
At the same time, it is almost impossible to travel these days, and thus the added value of a global boutique that is as digital as one can be and at the same time is physically present in China and in 88 other countries around the world, being able to be the extended arm of the clients is priceless.
Of course, Covid brought million new challenges, especially in the spring: like how to protect our partners being involved in Covid-protection related purchases from scammers, how to find the best possible suppliers for them on a completely new market, but we are fast learners.
Did you have to make difficult choices, and what are the lessons learned?
Rupert Varnai: The first most difficult choice was rather emotional than business-related: it was the beginning of 2020, seemed like we are facing the only-China virus and everyone told us to return to Europe (where there was no Covid at all that time).
Stay or leave, go for the presumed safety or stick to keep on building the business in China. We went for the latter, and fortunately, that was the right choice (from a business point of view, as we have not seen our loved ones for 1.5 years by now, which of course is very hard).
Another turning point was to decide when and to what extent to change our until-then-followed strategy and make a new, „Covid-compatible” roadmap. In other words, we had to change our products and react to the fact that the borders were closed and F2F meetings, cross border travels were no options at all.
The lesson we learnt is not new at all but still surprising: how quickly you can adapt to totally new situations in the short and the long run and make changes that you thought to be impossible when there was no compelling reason for a U-turn.
What specific tools, software, and management skills are you using to navigate this crisis?
Rupert Varnai: I guess there is no need to go into details regarding the things that are the new norms in everyone’s life: the zooms, the teams, and all the other gadgets that make online life and business making easier. Our best asset was our flexibility, which comes naturally from the structure of Cathay Group.
Who are your competitors? And how do you plan to stay in the game?
Rupert Varnai: We position ourselves among the top players right after the Big4. We provide services for companies that are either not big enough to work with the Big4 or require more personalized services from a 360-degree advisory group with worldwide coverage.
Your final thoughts?
Rupert Varnai: We have always believed in the importance of Trust in making business. This past period proved it right. First of all, trust is remarkably important in China, even in “normal” times. But the incredible number of scammers surfacing in the Covid-period, seeking their ways to harness the turmoil from all parts of the world, has reinforced us and, most importantly: our partners in this point of view.
The strengths of Cathay Group: strong, established personal connections within our 88-country network and also in China, are our main asset: we represent trustworthiness to both sides of a deal.
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