When China opened its fund industry to foreign participation back in 2002, there was an expectation that getting in early would be a key driver of future success. But there is mounting evidence that that has not been the case, with foreigners finding it hard to develop their global experience into a competitive advantage in China.

From the outset, the only way for international groups to participate in what was considered to be a major fund market in the making was through a joint venture with a local partner. Previous experience suggested this route could be tricky to negotiate.

When Korea opened its insurance industry to foreign companies under pressure from the US in the late 1980s, there was a rush from US insurers to establish a presence and partners were sought among potential local suitors. All foreign firms found the going tough and underestimated the impact on the business due to cultural differences, the overall management challenges and the underlying cost of establishing a presence. Few of those early pioneers could claim success and most left years later with little to show for their efforts and capital.