Michael Schuman reported on the front page of the business section in Sunday’s New York Times that, “In Dream Town, a collection of boxy office buildings on the gritty edge of this historic city [Hangzhou, China], one tiny company is developing a portable 3-D printer. Another takes orders for traditional Chinese massages by smartphone. They are just two of the 710 start-ups being nurtured here.

“Anywhere else, an incubator like Dream Town would be a vision of venture capitalists, angel investors or technology stalwarts. But this is China. The Chinese Communist Party doesn’t trust the invisible hand of capitalism alone to encourage entrepreneurship, especially since it is a big part of the leadership’s strategy to reshape the sagging economy.

“Which is why the government of Hangzhou — a former royal capital that has been a major commercial hub for more than a millennium — built Dream Town and lavishes resources on start-ups. The businesses here get a slate of benefits like subsidized rent, cash handouts and special training, all courtesy of the city.”

The Times article noted that, “For much of China’s long economic boom, young people flocked to manufacturing zones for jobs making bluejeans or iPhones. But today China is trying to move beyond just being the world’s factory floor. Policy makers want the next generation to find better-paying work in modern offices, creating the ideas, technologies and jobs to feed the country’s future growth.

“Premier Li Keqiang frequently calls for ‘mass entrepreneurship.’ In March at the National People’s Congress, he bragged that 12,000 new companies were founded each day in 2015.

“The entrepreneurial embrace comes with lots of financial support. Across the country, officials are creating investment funds, providing cash subsidies and building incubators.”

Mr. Schuman explained that, “Some economists and entrepreneurs are concerned that the government is helping fuel a frenzy that might ultimately result in failed businesses, wasted resources and financial losses. Just one city, Suzhou, near Shanghai, has announced it will open 300 incubators by 2020 to house 30,000 start-ups.”

Sunday’s New York Times article noted that, “Hangzhou is a natural center for China’s start-up fever. After China embraced capitalist reform in the 1980s, Zhejiang province, of which Hangzhou is the capital, emerged as a leading base for the export industries that fueled the country’s rapid growth. Factories pumped out products like socks and plastic Christmas trees.

“Now that zeal for commerce is being channeled into technology start-ups. Hangzhou is home to China’s most famous internet company, the e-commerce giant Alibaba, which has become a training ground for would-be entrepreneurs.

“The neighborhoods near Alibaba’s sprawling campus, once a poorly developed area on the city’s outskirts, now make up a budding tech center with newly built office parks like Dream Town, dominated by ambitious college graduates, angel investors and venture capitalists.”

And Mr. Schuman added that, “Hangzhou represents what Chinese leaders see as the nation’s economic future. The country used to generate astronomical growth rates by depending heavily on low-cost exports and extremely high investment in apartment towers, factories and highways. China built so many steel mills that it can produce 10 times as much steel as the United States.

“But today, costs are rising, eating away at the competitiveness of many export industries. The long investment boom has saddled the economy with too many factories and a mountain of debt.

“Instead, policy makers are encouraging a shift to new growth engines, like services and high tech. The entrepreneurial focus is providing an economic boost for Hangzhou.”

Telis Demos reported earlier this week at The Wall Street Journal Online that, “Transferwise Inc., the global money transfer startup, is getting ready to free itself from relying on banks.”

The Journal article explained that, “This is the latest example of the evolving and complex relationship between aspiring fintech disruptors and traditional banks. While many startups seek to displace banks, they also often rely on them for access to the financial backbones of payments, lending, or deposits.”

Demos pointed out that, “Transferwise says it is ‘peer to peer,’ pairing customers who are sending money to or receiving it across borders. It charges a small fee to make the match and exchanges money at the prevailing market rate.

“Working with banks to do so enabled Transferwise to grow to billions of dollars worth of transfers annually. But it also created problems, especially in the U.S. where money transfers are overseen by each state.”

The Journal article noted that, “The company has been getting state licenses since last year. It also announced in August that it could directly access the U.K.’s real-time payment system, though for now it still requires a small bank partner to do so.

“Such moves will allow the company to scale back its reliance on banks when moving money, except as back-ups. Taavet Hinrikus, CEO and co-founder, said Transferwise had always aimed to eventually seek its own licenses. This requires the firm to do things like check to make sure people sending money aren’t criminals and ensure senders have the money in their accounts. Transferwise said it already was doing such checks itself, and had viewed bank partnerships as a stepping stone.”

Demos added that, “In the U.S., Transferwise now has licenses in 37 states, and can operate independently in three states that don’t require licenses. In other states it will continue to use its bank partner.”

Shan Li reported in today’s Los Angeles Times that, “On-demand laundry and dry cleaning app Washio announced Monday it is shutting down, becoming the latest service-oriented start-up to wash out.

“The Santa Monica company expanded quickly to six cities after its launch in 2013, attracting time-crunched customers who wanted their laundry picked up, washed and delivered within 24 hours. Despite raising nearly $17 million in funding, the three founders wrote on the Washio website that they had been forced to close its doors.”

Today’s article explained that, “Several on-demand start-ups, which seek to deliver products or services at the tap of a button, have folded or struggled recently. In 2014, rival laundry start-up Prim called it quits. Last year, home cleaning service Homejoy shut down after facing lawsuits alleging its workers should be considered employees, rather than independent contractors…[A]nalysts said it can be extremely difficult for on-demand services to make money and hard to maintain high quality. Washio was charging $2.19 a pound for washing and folding clothing, along with a $5.99 delivery fee.”

Jack Marshall reported in Monday’s Wall Street Journal that, “If you’re trying to secure millions of dollars in venture capital, these days it may be better to pitch your business as ‘marketing tech‘ rather than ‘ad tech.’

“It has become increasingly difficult for advertising technology companies to raise money in recent years, but funding for companies in the closely-related marketing technology sector appears to be as healthy as ever.”

Mr. Marshall explained that, “U.S. venture-capital firms invested around $860 million in ad tech firms last year, the lowest amount since 2010 and down considerably from a peak of more than $2.7 billion in 2011, according to venture capital and private equity data company PitchBook. So far this year, only $446 million has been committed, on pace for the lowest funding level since 2005.

“But PitchBook data suggest U.S. venture capital investment for marketing technology companies has been steadier, reaching over $1.2 billion last year. Investment this year was already close to $1 billion by Aug. 23, according to PitchBook, on pace to surpass last year.”

The Wall Street Journal article noted that, “Why the divergence? One key factor is the business models that power these companies, venture capitalists say.

“Advertising technology took off on the promise to automate the buying and targeting of ads across the web. Such companies have typically relied on ‘media-based’ business models, whereby they collect revenue based on the volume of advertising they purchase and place on behalf of clients. They often sell to third parties in the ad ecosystem like marketers’ ad agencies, as opposed to the marketers themselves.

“By contrast, many marketing tech companies have instead focused on selling software on a subscription basis, often directly to marketers. The recurring and relatively predictable software-as-a-service revenue model is often more attractive to investors because it’s less exposed to fluctuations in ad spending and other market dynamics.”

Mr. Marshall added that, “Another consideration for early-stage investors is their potential exit. For many marketing and ad tech companies, the goal is to ultimately sell to a larger player.

“Terry Kawaja, chief executive of LUMA Partners, which has offered strategic advice to numerous advertising and marketing-related technology companies, said there’s a wider pool of potential buyers for marketing technology companies than for advertising technology ones. That makes them more attractive to venture capitalists.”