BEIJING, China -- When jiu-jitsu instructor Andrew Pi was battling in a mixed martial arts (MMA) tournament here in 2003, a powerful kick from his foe struck Pi's forearm and snapped the bone in two. Not wanting to lose with his students watching, Pi fought through the searing pain and managed to beat his opponent with a tight arm-lock hold called an arm-bar. "I was young and proud and I couldn't quit," said Pi, who was born in China but grew up in the Silicon Valley suburbs in the U.S.A. "I was trying to promote jiu-jitsu in China, and I needed to show how effective it was as a martial art. There was no room for failure."
After surgery on his arm, unable to train for three months, Pi reflected over the long-run goals in his life. Trained by legendary martial artist Royce Gracie in Torrance, California, U.S.A., Pi was founder of the Beijing Jiu-Jitsu Academy, the first Brazilian jiu-jitsu school in China. But Pi also wanted to spread the sport of MMA to the masses in China. The country boasts a long and proud history of martial arts, but no world-class Chinese athletes competed in the best MMA competitions. "I thought about it for awhile and said 'I want to do something that I'm passionate about,' " Pi said. " 'I want to promote MMA fights in China.' " (Photo of Royce Gracie by Esther Lin/ProElite, under Creative Commons license on flickr.com.)
So Pi called his younger brother, Konrad Pi, an investment manager and private helicopter pilot in San Diego who also had studied jiu-jitsu for many years. "Great idea," Konrad Pi said. "We can do it, but it'll be very, very difficult." Konrad Pi immediately saw the pros and cons. The upside: MMA is a fast-growing and reputable professional sport, shedding its earlier bloody reputation as "human cock-fighting." The martial arts are China's national pasttime -- what the Pi brothers call "the baseball of China." And China's hundreds of millions of middle-class consumers are hungry for world-class sports entertainment and a resurgence in national pride since the Beijing Summer Olympics have ended. The downside: Government bureaucracy and control. The logistical challenges of staging big events. Raising money for a new, risky venture in a country where many Western business moguls have been forced to tap out.
Potential investors were skeptical. But Konrad Pi, a relentless salesman and management science graduate of the University of California at San Diego, scrambled to find a few, such as football star Rashaan Salaam, winner of the 1994 Heisman Trophy, the prestigious award that goes to the best college football player in the U.S.A. To launch their new Art of War events, the Pi brothers and their father, Frank Pi -- a former IBM, EDS and Ernst & Young executive -- furiously worked their family and business ties in China. Chinese government contacts helped them to land key permits and other requirements to stage sports events. Their knowledge of "unwritten laws" and business practices also sped up their plans. "You've got to do it the Chinese way," Andrew Pi said. "One wrong move can really mess you up." Examples of some of those "unwritten laws"? Sorry, Konrad Pi said, business rivals would pay millions of dollars for that competitive edge.
The Pi family's fluency in Mandarin and deep understanding of Chinese cultural values didn't hurt them, either. "If you can't even communicate with someone, how can you possibly understand their cultural traditions?" said Andrew Pi, a psychology graduate of the University of California at Riverside outside Los Angeles. "And if you don't understand their cultural traditions, how can you do business with them?" He said that arrogant Western business people fail terribly in China -- he was one of those arrogant foreigners himself, when he returned to Beijing a decade ago. But his father and mother straightened him out. "My parents taught me to be respectful to others, and that’s especially useful for doing business in China, where respect and face are important to your partners,” said Andrew Pi, 36. “You have to learn to give face, not tear off a person’s face.” They also were motivated by the fear of failing their family, and not rising to their parents' expectations. It's that old Asian thing, said Konrad Pi, 34. "My parents did very well for us, raising us in an upper-middle-class home in the U.S." he said. "We didn't want to let them down."
They haven't shamed the family yet. Their privately-held sports management company, the Adoria Entertainment Group (Adoria means "success" or "victory" in Latin), seems to be well-positioned. CEO Andrew Pi and company president Konrad Pi see revenue coming from broadcasting rights, pay-per-view shows, and merchandising of Art of War clothing and other products. Art of War fights are broadcast to potentially hundreds of millions of viewers across mainland China, Hong Kong and other Asian countries via CCTV-5, China's government-run sports channel, and Inner Mongolia Satellite TV. The fights also can be seen online on Sohu Sports and QQ.com, China's largest online chat community. Meanwhile, Adoria Entertainment is in talks with more potential corporate sponsors and broadcast partners in Asia and the U.S.A. Andrew Pi said that the Ultimate Fighting Championship MMA brand is the best in the industry now. But he and his brother ultimately hope to make Art of War the No. 1 brand in Asia -- and even the world.
Their most recent Art of War event, a glitzy affair in Beijing last Saturday, attracted Chinese celebrities, business tycoons and a nearly sold-out crowd. (See Part One of this post.) The Pi brothers and others believe that Chinese consumers and China's 65 million martial arts practitioners will quickly adopt the Art of War, as people here often embrace new products and technology much faster than in the U.S.A. "China is a highly sought-after market, and the broadcasting of MMA has much potential," said HDNet executive Jeff Cuban, in Beijing to watch the event. Plus, the Chinese take great pride in their warrior-athletes. The Art of War fights feature Chinese Olympic athletes and national and world champions in judo, karate, Greco-Roman wrestling and sanshou. But MMA experts at the Art of War 12 event said that Chinese athletes will need more time to evolve into more versatile, elite MMA athletes who can strike on their feet and grapple on the ground. Same with the Art of War's business operation. If the company grows at a steady pace, it should do well. But if the Pi brothers rush in hastily, they could stumble. "This show does a lot of things right -- it's laying the groundwork for bigger things to come," said Monte Cox, a famed MMA promoter who manages Tim Silva, Matt Hughes, and other top MMA athletes. "It just needs time to develop."
Andrew and Konrad Pi agree. They welcome critical feedback and look forward to growing in the sports management field. As a business journalist, I've interviewed hundreds of executives and entrepreneurs over the years, and the Pi brothers are refreshingly polite, respectful and down-to-earth. Fighters and other MMA industry insiders clasp their hands and hug them throughout the weekend, showing genuine appreciation -- not kowtowing -- for their hard work in making the Beijing event happen. As their mother put it, Andrew and Konrad are promoting a young man's sport in a very old andtraditional country. It's taken the fighting arts in China centuries to grow, so the Pi brothers can wait three or four years for the Art of War to catch on. "We have an intense burden on our shoulders to carry forward," Andrew Pi said. "China has a great tradition of martial arts, and it needs MMA badly. You don't see Chinese fighters at the highest-level MMA tournaments in the world. We have to change that."