Lei Jun: ten criteria for evaluating Entrepreneurial Projects

In the past, I briefly introduced the four necessary conditions for my project selection, that is, "the general direction is good, the small direction is verified, the team is excellent, and the ROI is high ". Regarding the general direction, we mainly want to see if this direction is always promising for five to ten years. Every investor has his own unique insights. At present, I am most optimistic about mobile Internet and e-commerce. Of course, I am also willing to study some new directions. With regard to the return on investment, the success of early venture capital projects has a return goal of 10 times. Angel Investment has a higher risk than early venture capital, angel investment requires a higher return. In this way, the key issue of investment lies in the specific direction and team.

   In my opinion, teams and directions complement each other and are indispensable. That is to say, if entrepreneurs lack the ability, the best direction and opportunities will be hard to grasp; if entrepreneurs have excellent abilities but are not doing well, it will be difficult to make a big difference. I have summarized ten criteria for evaluating a startup project for your reference.

 

1. Team (investment is the investment, and people are the most critical factors. In a commercial society, the most important basic quality of human beings is integrity. If there is no credibility, no one will invest in it .)

   1)Insight into user needs and extremely sensitive to the market

   2)Ambitious and down-to-earth

   3)It is best to start a business with two or three people with complementary advantages.

   4) be sure to have a technical leader (Internet project) who is skilled and can bring a team)

   5) rapid expansion capability at a low cost

   6)A person with a good resume is preferred. For example, a person with a successful start-up experience will receive extra points.

 

2. Direction (do the right thing when you are right)

   7) make the best market and select the largest market you can do. Only large markets can create large enterprises, but small pools cannot raise large fish. If the direction is biased, valuable entrepreneurial resources will be wasted.

   8)Select the correct time point. The market is basically mature, and enterprises have already taken shape. After Angel Investment is introduced, the business will grow explosively.

    9)Focus, focus, and focus. It is best to do only one thing, so that we can do things to the extreme!

  10) the business is verified on a small scale and has the opportunity to reach the best position in a vertical market.

 

  People may think that the above conditions are very harsh. Isn't it possible to succeed without these conditions? Of course not. These conditions are not all necessary, but entrepreneurial teams that have these conditions can be more confident in their success. Especially in the current market environment, with the global financial storm sweeping the world, venture capitalists will also have stricter project review standards, and the more conditions they meet, the better. If all these ten entrepreneurial projects meet the needs of investors, they will easily get investment.

 

 

 

 

    Over the past two or three years, I have used these top ten standards to select some projects, such as VANCL, ucweb, Lakala, and duowan. When I invest in these enterprises, there are only 10 people or only one idea. In just one or two years, each of them has completed more than two rounds of institutional financing, at present, there are more than 200 people. Today, the performance of these projects is very good, and it is closely related to the ability and orientation of entrepreneurs.

 

    Finally, I would like to share with you one of the most important tips for investing: it is easier to get started with acquaintances. The integrity of entrepreneurs is the premise of investment. No matter how long it takes to communicate with entrepreneurs, it is difficult to establish enough trust for each other at once. Because angel investors are personal, they are not able to do enough due diligence before investing, and basically do not participate in management after investing, which puts a higher requirement on integrity. The introduction of acquaintances is equivalent to an endorsement of the integrity of entrepreneurs. It is much more difficult to get an investment by sending a project book blindly.