How to retain talent is a major challenge faced by companies all over the world no matter how successful they are, but for startup companies with limited resources compared with the major players, the threat of losing people is even higher.

However, according to Xi'an Qin Shen Special Control Valve Co Ltd, a small company based in the Xi'an Hi-tech Industries Development Zone, the trick to holding onto staff is quite simple: run your firm like a family.

The eight-year-old business, which develops and produces special valves for the power industry, has thrived on a relatively small workforce, according to founders Zhang Xiangnan and Li Li.

"Big companies need regulations to rule their people. But small firms can interact with their staff in a way that makes them feel more human. Those that last 100 years are the ones run by people who never act like the boss," said Zhang, who is general manger.

Zhang said what has made her business work best is its unified approach.

"Sometimes we have to deliver products at very short notice, which means our employees need to work overtime－that requires a deep commitment to the company," she said.

An example of the family atmosphere within her valves firm came quite recently during a lean spell in orders when cash was tight, she cooked for her staff to celebrate the Mid-Autumn Festival.

"A successful company is a platform that belongs to everyone. Apart from financial returns companies have to contribute to the individual growth of their people too," she said.

At the end of every year, Zhang writes a letter to each of her employees to thank them for their hard work, to praise their progress, and to highlight where things might be improved.

The company also organizes all kinds of leisure activities for its workers, from watching films to traveling to help those in rural areas understand about life in the city.

Li Li, who is chairwoman, said it is also important that companies empower their employees, and equates its work ethic to that of the education sector. The firm's 70-strong workforce－40 of whom are skilled technicians－have powered its sales from 700,000 yuan ($112,550) in 2006 to 40 million yuan last year.

"We don't want to gain market share by getting involved in price wars. We want to build a strong company by having at least one of our valves become a market leader," said Zhang, who claims her products can now genuinely compete with more recognized imported rivals.

According to Zhang, there are more than 1,000 different valves used in power plants in China. Xi'an Qin Shen currently produces just 200, but she said it will invest in research and development to gather the skills and knowledges it needs to not only catch up with overseas valve giants, but overtake them.

The Xi'an hi-tech zone offers startups like Zhang's various incentives to invest there, including interest-free loans and consultancy on entrepreneurship.

"We were not born and raised in Shaanxi province," she said. "But Xi'an feels like our home. I believe our company has a very rosy future ahead."