MI, chairman of Greentown, built his own house, another hill is the trend

At the beginning of February 2015, MI, chairman of Greentown, built his own house.

In song sell Greentown shares to Hongbin, MI Building once and song leave, but half a year later, song back to the green, MI built the building chose to go it alone.

Mi and Song is a fellow, he started with a tie business, in the field of electrical business experience. Four years ago, MI built a chat with song, joined the Greentown for song to build electric business platform.

On the February 6, MI, the chairman of the Network group, appeared in front of the public, wearing a red hoodie and several co-founders standing on stage, signing a strategic partnership agreement with Sequoia Capital and easy-living capital.

MI, it's natural to leave song.

After announcing the 60 million dollar news, the founder's team announced that the company had moved away from the Greentown group. They are now playing with the small partner is to do home building materials for the cattle and the internet finance of the Golden Summit, the two companies will be with the original Greentown Electric Corps team together formed a network construction group.

The outside world for its departure from the Greentown speculation. Bao, the founder of the Green House, has been careful to talk about the topic, "I do not like the word" to Greentown. Everything happens naturally. Chang Lei, chief operating officer and co-founder of the network group, replied.

Song is regarded as "forums", the green house electric Dealer's helm Mi building is "whenever", the performer Chang Lei is "the". Three people in three years doing different things, song insist on doing boutique residential development, MI built the Internet into the real estate, now Chang Lei is committed to building an Internet supply chain financial enterprises. They intersect in the real estate industry, and the gap between thinking about business models is drifting away.

Another mountain is a trend

2010, the property market restrictions on the Greentown project was hit. Song tried to ease the pressure of capital through cost control.

Greentown a person responsible for material procurement told "Chinese entrepreneur", "I have to and the domestic a very well-known ceramic tile brand to talk, found that the ex-factory price originally only dozens of yuan, but the final sale to consumers is more than 800 yuan." The windfall is due to the large number of trade levels in the middle. In addition to the fare increase, "he paused," according to the proportion of orders to designers, buyers and other people's rebate is also one of the inline rules, only this one accounted for three or four of the cost of procurement. ”

Song thought of using the Internet to reduce costs, so he found Mi building, two people in the late at night to discuss all the ideas of the electric quotient, to the early morning end of the conversation, the Green House electric business prototype has.

Subsequently, Song gave him 50 million of the investment. "This is the actual capital injection. "Mi Building told the Chinese entrepreneur." Greentown Electronic Business positioning in the business-to-business domain, that is, enterprise-level trading platform. Greentown is a centralized procurement platform to replace the identity of a large number of dealers, while the process of transparency of the transaction. Online site to provide display, matchmaking transactions and other services to the offline team to solve the sales, after-sales service and other user experience problems. Provide solutions for Greentown group and external customers through online and offline cooperation.

In short, song wants to reduce transaction costs by reorganizing the supply chain to ensure quality and service. At the same time, he also wants to let the Greentown has the ability to serve other enterprise-class customers.

In an industry of such uneven quality, having a set of standards is the key. In China, the standards of different building materials vary widely, and the standards required by international, national and enterprise are not the same. So a complete standard system can be subdivided into more than 10 parameters, more than 10 dimensions.

Over the past few years, the Greentown team has spent countless efforts to build its own standard system. They start from the inspection plant, the data obtained from suppliers and production details into their own database, while clear access to the threshold, while setting and adjusting the industry standards. Their team is sometimes simply stationed at the manufacturer's production site to master the plant's capacity, scheduling and delivery time. The so-called deepening supply chain management, means that the production plan from the manufacturers began to intervene, by reducing the number of intermediaries to shorten the distance between the factory and the customer time. "It all depends on our supplier's production mechanism and understanding of the industry." Chang Lei told The Economist.

Another area that needs to be carefully built is the installation process. Building materials industry, such as elevators, tiles and other so-called five-point products, five-point installation of the argument. Greentown has made reference to the Japanese experience, on the one hand, to their suppliers in accordance with their auxiliary material design program for customized production, and then to the site assembly. On the other hand, the establishment of their own installation team, and the establishment of relevant assessment certification standards. "Our projects all over the country are done by our own team, or invited by the Greentown certification service provider." ”

The first year of the establishment of Greentown, more than 80% of the revenue from the Greentown group. In fact, the quality and service standards it originally established inherited the standard of the Greentown group-and in both respects, song's requirements are almost ideal, and few in the industry can. So the whole standard system of Greentown is not only far higher than national standards, in the industry also biased in high-end level.

At this stage, Greentown is to benefit from continuous optimization of supply chain and meticulous management. To tile, floor category, Greentown can reduce the cost of 10%-30%. In stock, Greentown can bring it down to about 10%. In the warehousing and channel two links more is in the efficiency enhancement, at present still cannot quantify.

Over the next two years, Internet thinking has stirred and impacted all traditional industries with unprecedented momentum. Home building materials electric business development is in full swing, 2013 Red Star United States Chiron led 19 channels to boycott the cat "double 11" activity is essentially the traditional mode and the fierce collision between the emerging electric companies, once caused widespread concern in the market.

At that time, Greentown electric business also considered to take advantage of the cat, Cat Vice President Maxuejun also went to its offline exhibition hall for field visits. But the plan failed because of ideas and patterns.

No matter how much resistance in the process, home building materials electric business development is the general trend. In the practice of "internal strength" 3 years 10 months later, MI Building believes that Greentown not only has the ability to serve the enterprise-class customer service, it will also be a great potential in the consumer market. So he began to figure out how to extend the service content of Greentown, to build O2O closed loop.

This means that, in the past, Greentown was the core of supply chain management is quality control, then now MI Building and his team will be thinking about and solve the whole industry chain more problems.

But as the internal adjustment has not yet been completed, an external upheaval has brought a far-reaching shock to the Greentown, and in some ways has directly changed the development trajectory of the start-up company.

May 22, 2014, song will be the green Greentown China's equity sale to the financial creation. In less than one months, the Greentown group from the whole strategy to the internal organizational structure has undergone major changes, the relevant personnel cutting is inevitable. Mi Building to The Economist confirmed that from the June Green Corps team "the vast majority of people return to the Green Green's job, only a small number of people stay." ”

Its business has also been greatly affected. MI construction began to provide services to more small and medium-sized enterprises customers, but the requirements and standards of these housing companies than the original Greentown group is much lower.

However, "we will not deliberately cater to the low-end market." "Raiveisa, a vice chairman of the network construction group and a material system from Greentown, told this newspaper," Many brands are not well-known, but in some ways to small and beautiful. Greentown Electric Chamber of Commerce has a set of integration and screening system to find the right brand, try to provide the lowest price of green quality of the program. ”

The result of this year's operation is that the Greentown has successfully left 1060 old customers, and in the case of the Greentown business to 30% of the company's revenue, 2014 its revenue actually did a slight increase.

The Greentown is only a symbol.

In just a few years, the industry situation has changed dramatically. The financial problems of Greentown have now become the bottleneck of the whole industry. The time has passed when housing companies can use financial leverage to pry into a real estate project.

Now, in order to save money, more and more developers are willing to hand over their purchases to a Third-party business-to-business platform. The latter can negotiate with suppliers by integrating the needs of different small and medium-sized companies to win lower quotations and better services on a scale. A case that is often talked about by insiders from Hong Kun real estate, after the purchase to a third party business-to-business platform, a project cost savings of up to 200 million yuan.

"Home building materials market is a trillion-tier market, but also a lot of pain point of the industry." Kongling, deputy director of the National Securities Research Institute, told Chinese entrepreneurs, "not only in terms of price, quality and service and so on have great integration space." "Unlike other retail products, the electrical conductivity of home building materials is very low," he said. In particular, building materials, electronic Business business-to-business, the current market has not formed a very mature electric business model, "Building Materials business-to-business field will be following apparel, 3C Digital after the next gold mine." ”

Now the Nuggets are here. "In the long run, it is inevitable that Greentown will be divorced from Greentown." "Kongling analysis points out. Greentown's new position is to be a Third-party platform company, which must be independent of any real estate business. "The attractiveness of an enterprise that is both an athlete and a referee on its platform will fall sharply." ”

The ownership structure of the Greentown has also changed: MI Building, Chang Lei and the same Raiveisa from the Greentown material system have fully controlled the Greentown, Greentown China holds a minority stake. The new company still continues the brand of "Greentown", which may be song's last support to his friend.

Now they have to do three levels of things: the Internet, supply chains and finance. Chang Lei that one of the Internet's thinking is to build the industry's ecological circle. They found the new partner House cattle dealers and the Golden Summit. The former is mainly responsible for the development of household building materials market, the latter is responsible for the main industry to provide financial support. Their common goal is to create an open platform, from the manufacturer's foreman, home to install the company's designers, and then to the installation and after-sales service team ... The whole industry chain of stakeholders are connected through this platform.

The platform has a new name: the Net-building group, after getting nearly 60 million dollars in capital inflows from Sequoia. "It will be the main body of the future listing, and the Greentown is still the core part of the subject." "Mi built this to tell the Chinese entrepreneur."

Network construction Group as an Internet platform company is open, but summarized in the Green House electric business platform of more than 200 supplier management system is closed. "The other two plates (housing cattle, Qian jinding) rely on the green house to help the electricity business, development will be relatively easy." In turn, their development can feed back and help the development of Greentown. Said Mi building.

The Cattle Electric chamber then launches a series of actions. They immediately set up their own marketing team, and quickly build a technology platform. In the external promotion will highlight one-stop home decoration solutions, 3-April, the housing cattle electric business is expected to be settled into the cat; in August, the website of cattle dealers will be online independently.

What the capital can't solve

"Home building materials Business-to-business is an industry in the tuyere." Kongling, deputy director of the National Maritime Securities Research Institute, said, "It's easy to do it when it comes out as a service provider and does not profit by earning a difference." "In this field, there are few strong competitors in Greentown. "Once the Greentown can build the platform in dozens of places nationwide, with thousands of developers, and hundreds of thousands of building materials service providers into the Supplier management system ... The value of this platform will be limitless. ”

However, "It is very bad to burn money during the race." "Kongling told The Economist," from the early cushion, to regional promotion, and then to match the system construction, and so on, each link to the fund's thirst is very big. ”

It is worth noting that the building materials to the electricity business needs of the early cushion is due to the middle involved in the management of the account. The so-called account period, from the default supplier payment or by the purchaser for its advance payment, and then to its repayment period. This cycle is prone to months or even six years. In the past, dealers played the role of cushion, and now that the electricity dealers want to replace, they must take over the problem. Therefore, the household building materials electrical business must manage the period of good, to ensure the safety of their own cash flow, or through the provision of financial services to help solve the industrial chain of the main financial problems.

"From the perspective of the future development of enterprises, we will pay more attention to scale." "The strategic layout of MI building is coinciding with Kongling. "The next step, whether it's a second round of financing or a sprint target, is to help companies develop quickly by docking with capital." ”

"There is no mature valuation system at home," said the company. "Chinese Sequoia Capital China fund partner Liu Xing said frankly, how much money needs to be invested in order to meet the company's reasonable development expectations, investors, founders and shareholders also need continuous negotiations and research," business can be analogous to the company, in my mind I can only think of Alibaba. ”

And Mi building is that "pure can use capital to solve the problem, it is not a problem." "Before rapid replication and expansion, he wanted to torture himself whether the team had the ability to develop rapidly," he said.

Several founders of the network were born in different industries and were not deeply immersed in the Internet field. On this, Kongling bluntly, "It's a short plate of it." "Internet entrepreneurship, as summed up with Lei, to fast, the product also to achieve the ultimate." The biggest difference with real estate companies is that internet companies are light asset models whose core assets are people. Therefore, the net construction group must first solve is also the talent reserve and the training work. They will focus on bringing in people who really know how to play the Internet, and hiring in building materials, finance, warehousing and logistics.

Network construction Group now has more than 600 employees, the assessment of indicators are per capita sales or per capita output. In order to innovate and develop the need, the net builds the group to take the enterprise partner system, simultaneously encourages the internal entrepreneurship. "We are taking the department of Business, in fact, is to keep our business is small, to provide employees with the opportunity and atmosphere for entrepreneurship." "Entrepreneurship is actually a very broad concept," Chang Lei says. It is a way to start a business on the platform, not to start a company on your own. People of different ages, at every stage of the idea is also changing, which is to promote entrepreneurial tide of the basis.