140 IN THE SHADOW OF THE DRAGON $3,141,424. Holip became one of the leading domestic producers of frequency converters with a 2 percent market share. Holip's founders had lofty ambitions. The company not only wanted to capture the segment of the market for purchasers that were easily satisfied with "good enough" converters--it also wanted to capture the high end of the market occupied by the products con- sidered to be the best available anywhere. With a limited internal R&D capability, the company turned to the universities to develop new technology and products. In 2004, in conjunction with a profes- sor at Tsinghua University, Holip embarked on a $241,648 project to develop frequency converters capable of generating higher torque. When the project failed, Holip's management team realized that its lack of the right technology was a significant roadblock to future growth. As Fang put it, "Now we know how deep the water is." To develop or acquire the technology it needed, Holip required