This article examines why an aboveground pink economy has emerged in mainland China, where equal rights for gay people are repressed and public attitudes toward homosexuality are overwhelmingly negative. Drawing on interviews, supplemented with a minimal amount of media data, this article demonstrates that in China there was a group of gay people wishing to fulfill needs mainstream businesses disregard and that such consumer needs necessitate China's pink sector. More importantly, the state set the stage for the nascent sector to emerge: Government policies triggered a surge in funding resources and technology infrastructure upgrades that laid the material foundations for pink entrepreneurship. Despite being born in an institutional void, pink ventures employed legitimizing strategies to hedge against risk and uncertainty, thereby consolidating this new market. China's pink economy developed independently of the influence of the gay movement and even expanded, as never before, at the low ebb of the movement. This research gives credence to the notion that an aboveground pink economy could precede political rights but, unlike American scholarship, questions a similar causal relationship between the two in the Chinese context.