When S.R. Nair began opening factories in China in the late 1980s, his Chinese partner insisted that a dormitory be built in each one so workers could take an afternoon nap.

More than a decade later, China is waking up to global competition, and opportunities.

“They’re more open and aware of what’s going on in the outside world, and they’re adapting to it,” Nair said. “It’s become easier to negotiate with them.”

For Nair and his partner, John Farid, neither of whom speak Chinese, that has meant a boom in business.

In 1995, Nair and Farid opened Thousand Oaks-based International Technologies Network Inc. with the intention of providing consulting services to American businesses interested in working in China but unfamiliar with the customs. It took awhile for that model to get off the ground, but the company managed a steep growth curve anyway by becoming a sort of hybrid venture capital/consulting operation.

From $500,000 in revenue in 1995, the company took in $5.4 million last year and is projecting $10 million in revenues this year.

ITN’s first client was a Chinese chip manufacturer looking for an American partner that would help it penetrate the U.S. market. Unable to find any company willing to buy in, ITN decided to change its model: ITN would become the Chinese company’s partner, supplying some venture capital as well as U.S. engineering experts to help run the Chinese plant. The joint venture was relatively successful and was eventually bought out by a U.S. competitor.

Today, a key component of ITN’s business is forming similar partnerships with Chinese companies that manufacture air-conditioning units, circuit boards for mobile phones and television components.

ITN also makes venture capital investments in emerging Chinese firms, many of which are in the process of being privatized. It recently invested in a state-owned speaker company that supplies equipment to Phillips Electronics and other consumer-electronics manufacturers. ITN’s investment will be used to help buy the company from the Chinese government, and change it from a money loser to a money maker, Nair said.

But that transition can be an extremely difficult one in China.

“In state-owned companies, there’s no incentive (to perform well), and a lot of overhead,” Nair said. “When we privatize, we trim the staff and put in a reward system for people who stay.”

The cultural differences between America and China sometimes take a toll on ITN. In one joint venture, involving a company that made parts for circuit boards, ITN’s role was to appoint the company president while the Chinese partner would appoint a vice president. But the partner titled the vice president the “Chinese president,” creating a dual management and operating structure that ITN found unworkable. Eventually, it was forced to sell the firm to its Chinese partners.

In 1997, with a couple of venture deals under its belt, ITN returned to its original mission: consulting for American businesses interested in setting up manufacturing facilities or other operations in China.

Also in 1997, the Chinese government lifted restrictions that had forbidden companies from forming franchises. So last year, ITN signed an agreement with Chem-Dry, a professional carpet cleaner based in Utah, to open Chem-Dry franchises in China and Turkey. ITN has marketed the service to U.S.-owned hotel chains and the U.S. embassies in the five Chinese and Turkish cities where it does business. So far, that part of the business is still losing money.

Craig Donaldson, CEO of Chem-Dry parent company Harrison Research Inc., said he chose ITN as the master franchisee in the China market because of ITN’s previous business success in the country and its knowledge of the market. Chem-Dry sets up master franchises in which one company manages all the franchises in a certain country, either owning the franchises outright or selling them to individuals within the country. ITN has decided to own all the Chem-Dry franchises itself.