Qing ke Chuang cast: Optimistic about mobile social games and O2O

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"Lead" Whether you look at it or not, over the past 2 years, more and more people are jumping into the mobile internet wave. Even if the profit prospects are not clear enough, venture capital is still willing to play the most important catalytic force, using hot money to stimulate the industry to heat up. And with the concept of mobile internet in the industry infiltration, since 2011, venture capital has evolved into the entire Internet industry, the enclosure movement.

Is it a mistake to cast a net? or is it a carefully planned investment layout? NetEase Technology exclusive interview with the main venture capital company partners, detailed their thinking and thinking in the mobile internet boom.

According to Chingko Research Center data, only 2011, China Mobile Internet has disclosed the number of investment cases is 58, the disclosure of investment amount of 596 million yuan, the average single investment amount of 13.86 million U.S. dollars, far more than the same level over the years.

At the beginning of 2012, China Mobile internet industry investment slowed markedly, January 2012-April, China Mobile internet industry disclosed investment events of only 10, the total amount of disclosure of investment of about 52.93 million U.S. dollars, the average single investment amount of about 10.59 million U.S. dollars.

From the disclosure of the number of investment cases, the total amount of investment and the average amount of single investment, the early 2012, China Mobile Internet industry investment level is much lower than the same period last year.

Yes, managing director of the Qing branch, said the slowdown in the first half of the year was a return to sanity in the capital markets. Taking the Qing branch as an example, its investment in mobile internet further increased, will mainly focus on mobile social games and O2O fields.

2011: Electricity quotient bubble hits mobile internet

In the last year, E-commerce, mobile internet, cloud storage is a hot spot in the investment world.

Yes to NetEase Technology, said: "Last year about 20 projects, mobile Internet projects accounted for less than half of the first half of this year, only five projects, but three are pure mobile internet domain." ”

Yes admits that last year, there was a real bubble in the field of mobile Internet investment, and many projects were overvalued. Analysis of the reasons for a variety of factors, such as the relatively active capital markets, mobile Internet has just arisen, the emergence of a variety of innovative models, and so on, in addition, Yes said last year, the investment bubble in the electric business sector is bigger, the overall pull up the investment in hot areas of valuation, the mobile

Last year, by the impact of the thousand-World War, the vertical electric business speculation, a number of e-commerce enterprises have been unprecedented million-dollar level of investment, the valuation is high.

"Last year, the Electricity Business project financing to get tens of millions of dollars is the starting price, did not get tens of millions of dollars are embarrassed to greet people." A few years ago, when a company melted into tens of millions of dollars, it might be known to all the people of the country. But in the last year, there were no fewer than 10 companies in the electric business sector to get this level of investment. ”

The amount of money needed for mobile internet projects is nearly 10 times times the level of tens of millions of dollars required by the electricity business, but there is still a high valuation.

2012: Fiery and cautious

As for the investment of the Qing branch, the investment rate slowed down markedly this year, but increased the proportion of mobile internet investment. Yes that the investment community has not lowered the heat of the mobile Internet, but the options and valuations are more sensible.

By the electricity industry only goods will be listed adverse impact, last year, piled tens of millions of dollars into the electricity business investors sober a lot, as the mass war gradually came to an end, the electric business field of tens investment in this year rarely heard.

"Only in the last year was considered a very good company, before the listing of people think it may be a financing target of more than 1 billion dollars, but the final listing performance of only 200 million dollars, planing out cash, the company value less than 200 million U.S. dollars, completely unexpected." So the only product will be such a growing fast, has been the capital market bullish companies are so, other electric operators must be more difficult, there is no doubt. ”

In addition, from the beginning of last year, whether in China or the United States, the market has been depressed, European and American partners began to be cautious, Yes said, the Qing branch of investment although the scale of fund-raising did not decline, but the European and American partners cautious attitude, will bring some pressure on investment institutions.

With the capital market cooling, "Rob Project" is no longer a common phenomenon.

"Although not a lot of money, but everyone rob the mentality of the project is more anxious." This year in the valuation of a little cold, but the change is not small, the mentality will be more sensible, will not appear today just finished a project, a week not to decide the project may be lost, the difference is here. "Yes introduced.

If the market condition is not warming for 3 years, then most of the investment institutions will not be in the field of electricity business, compared to the "Fast Project", mobile internet projects are much slower, if the optimistic area, you need to prepare for long-term investment. When the market warms up, maybe it's time to harvest.

"Investment in mobile internet, to see the future three or five years later, I believe that three years later, the entire China has more than 300 million smartphone users in the market space, users on the smartphone will be more and more time, so I think this direction is right." ”

Focus early on mobile social games and O2O

Qing Branch Venture has been committed to early investment, mobile Internet-type projects, investment in 500,000 U.S. dollars to 5 million U.S. dollars, Yes clearly said, will not do angel investment, which means that the Qing branch of the product is very important.

"If the product has not been done, on paper, then we will not vote, but for example, a small team of four people to do an app just on the line, we feel good, even if it is zero income, but we can vote." ”

Yes said that the Qing branch venture in all areas of mobile internet projects will be contacted, but relatively optimistic about mobile social games and O2O. The reason for watching mobile gaming is that Zynga has not yet been born in the field, and the second is that the gaming industry's profit model is currently the most stable. However, game-type projects are prone to lack of stamina shortcomings, constitute a certain risk, therefore, investment in game projects, the selection of the team more important.

The O2O project has been hot since last year in the investment world because it can actually address user needs and make a clear profit model. and Yes more value is the O2O Project innovation ability, encourages the innovation, then means occupies the market.

In response to this year's few projects in the mobile social arena to get big capital investment issues, Yes explained that the mobile social domain in the last year was affected by foreign social products, but the product innovation too little, homogenization serious, the real problem is not in the "three Mountains", but the products are not obvious differences between the users, instead of the user streaming. Investors are certainly willing to "gamble" if they have a mobile social program that can find their way and continue to operate.

"A few of the same kind of social apps, the root of the killing between the roots are still, the ceiling is also thinking of micro-letter, entrepreneurs under pressure, investors will naturally be more cautious." ”

Don't worry about profitability there are no projects with users but not money

Yes said that the mobile internet is a long-term investment, not worried about the profitability of mobile internet projects, game-type projects are relatively easy to profit, annual revenue can reach tens of millions of dollars, but affected by products, more likely to return to the merger category.

While social programs have become "unpopular" this year, companies valued at more than 1 billion are most likely to be born in the social arena.

O2O projects will be more convenient and sound with the mobile payment function, "will be more and more smooth within a year or two." ”

As for the profit model for other innovative projects, Yes says there are no projects with users that don't make money. Entrepreneurs should insist on innovation, accumulate users at the same time to maintain user loyalty, it is possible to birth a new profit model.

"The opportunity to make 1 billion-dollar companies is really relatively small and not easy, but there are still plenty of opportunities for companies that value hundreds of millions of dollars." "(Text/Hu Xiao)

"Interview Record"

Reporter: Please describe the investment in the mobile internet in the last year and this year.

Yes: Mobile Internet, we voted about 10 last year. Five have been voted in the first half of this year, some are still doing so they cannot be made public. From the number of plans, this year will still be less than last year.

Reporter: Why less?

Yes: First of all, from the industry, because the Qing branch itself to do this industry research, that is, this year's entire investment than last year is obviously to slow down a lot, the big environment I think is a big impact it. But in terms of direction, I think for us, the mobile Internet does not slow down, like this year we do these cases, may have just said that five of the three cases are related to the mobile Internet, last year, the Qing branch made more than 20 investment, but there are many and mobile Internet is not directly related. We are very optimistic about the mobile internet in this direction, we still more firmly believe that.

Reporter: You just said that the Qing branch industry research shows that this year's big environment will have some changes, what kind of change?

Yes: I think last year, in a company that voted for a mobile internet project, in fact, you go to see, first of all, no matter how hot, really dare to invest in mobile internet organizations in fact not many, last year I do not think the mobile internet has a very high bubble, is that you compare the electricity quotient to know, electricity quotient I think is a bubble, You see the electricity dealers get tens of millions of dollars is the starting price, you do not get tens of millions of dollars are embarrassed to greet people, electricity is very hot, but in fact you want to put a few years ago, what is the order of magnitude of millions of dollars? A company that melts into tens of millions of dollars may be known throughout the country, right, but last year, The electric business industry has a lot of home to get this, should be no fewer than 10, I think dozens of have.

But the mobile internet is really not a lot of millions of dollars, yes, I think most of the investment is still in the order of magnitude of millions of dollars, so I think, but because everyone is worried about the mentality, the investor's mentality is also more anxious, so although the money is not a lot, but we rob the project mentality rather anxious. This year I think valuations may be a little bit colder, but I think the change is not so big, the mentality will be more sensible, do not say I just finished a project today, a week you do not make a decision the project may be lost, now may not be the case, that is, we rob this mentality will be much better. The difference is right here.

And this year, Europe and the United States the overall trend of the economy is not very good, so the impact is not the performance of listed companies, because we are partners to the money, partners in Europe and the United States, so they see the trend is not good, especially including the listed companies also fell very miserably, so in this case, They will also have some impact on the fund's investment requirements, that is, he will question some of your investment, if it is a relatively high valuation of investment, he will certainly be more skeptical, I think this is a major reason.

For Chingko, we might have a relatively small impact, because we're doing an early investment, you bet that this is not going to work, not to compare with the listed companies, but do B-round, C-round investment, it must be (compared with the listed companies), when you today's investment company valuation close to tens of millions of U.S. dollars, Even billions of dollars, a look at a listed company may be only one, 200 million dollar valuation, you have to think about, I am to buy a listed company's stock cost-effective, or buy a growth process of the company, the above billion-dollar valuation to buy cost-effective, there is such a direct contrast effect.

Early investment, for example, the amount of money you invest, such as our minimum to 500,000 U.S. dollars, 1 million dollars like this, but after the investment is estimated at millions of U.S. dollars, up to 10 million, these companies, I think actually see the whole industry in this piece, anyway, the Qing branch is not much impact, Then we will be more sensible, because there is a point of course, although we cast early, but you must also think of it in the future to melt the B-round, to melt the C round, if you want B-round, C-round financing situation is such a case, then you vote in the early days to think, if the time to vote B-turn to do, So you must think more of this.

Reporter: In the mobile internet field, compared to last year's investment environment, what changes this year?

Yes: First of all I think the mobile internet has not changed much, I think valuations will certainly be more sensible than before, but I think the past mobile Internet, I do not think it is very reliable, is the electrical business. This year I think the biggest difference is that all the electric business enterprise financing is very difficult, because you see the listed companies, that is, like the only goods will, this last year, we all think is a very good company, and he may be the target of more than 1 billion dollars to do such a listed company, but the final listing performance everyone knows, it is only more than 200 million dollars , of course, he has more than 70 million cash, so the company's value may be less than 200 million dollars, which is probably a result that everyone had never thought of before. So the only product will grow quickly, and we all think that the value of the company are very good, other electrical companies must be more difficult, there is no doubt.

Investing in mobile Internet, we are looking at the future three or five years later, I believe that three years later, the entire China has more than 300 million smartphone users in the market space, and I think users on the smartphone more time will be more and more, so I think this direction is right, In fact, people are still willing to make early investments on the mobile internet, now there is a characteristic is that angel investment is more, mobile internet is worth to invest so much of the company now also so much, so you see the whole valuation is also relatively low, Chingko in the mobile internet does not have a great amount of investment.

Journalist: The idea is that, last year, the mobile Internet was the initial layout, with both the traditional Internet giants and innovative companies focused on mobile internet, which had already covered the basic application type last year, so there was a lot of investment going into the enclosure last year, though there were some gaps this year, But most of it has been bridged, and the next step is to fill in gaps and innovate, do you agree?

Yes: Well, because the big difference between mobile internet and previous traditional internet is that there are already a lot of internet giants looking at the market, that is, you find the gap is not easy, for example, to do a social class, such as rice chat such a typical example, once developed very fast, But then by the micro-trust shock, but why do I still think there will be a lot of opportunities, because I think it is not easy to start a business in any part of China, to find space in the gap between the Giants, but if you find, I think it is possible to do some big things, I think in the future you want to make 1 billion dollar company This kind of opportunity, really is relatively few, not easy, but make this kind of valuation is hundreds of millions of dollars of company's opportunity still have a lot of.

With the increase of the thousand-yuan machine, there will be 200 million or 300 million new smartphone users in the future, these users may not have strong internet use habits, but he has the habit of using smartphones, I think there are many opportunities.

Reporter: Mobile internet profit model has been questioned, as investors, you will worry about the future of mobile Internet profit? What kind of company is the most profitable?

Yes: I'm not really worried about the profitability of the mobile Internet, because we're looking at a few industries now, including the possibility that the game has shown that it actually has a decent income.

Another is O2O, buy a service on the phone, and then spend online, I think this opportunity is more and more. At present, it is not convenient to pay some places, but in the long run this is certainly not a problem, within a year or two, I think it will be more and more smooth. The game and O2O business model is very clear, so I am not very worried about this.

Other applications, if they can bring the user, through the derivative of advertising, or in accordance with the effect of paying the way, can generate returns. So in the end, I think as long as you have a user, there is always a way to earn money.

Two days ago I saw an American there is a discussion, that is, there is a large number of users, but there is no money to make such a site or application, the discussion of a lap, in fact, there is no real product services say there is a huge amount of users do not earn money, does not exist.

Journalist: Do you think the social application developers, on the one hand under the pressure of Tencent, on the other hand, the profit model is not clear, they survive the support point where?

Yes: I think of course this like this mode, must be supported by VC to support a period of time, facing such a large pressure, if you still want to go to the problem of profitability, then this station is too difficult, so certainly still rely on VC to support. For the MO, although the micro-letter and their positioning is very different, but the micro-letter will certainly form a threat, but I think silently is to do a specific vertical application, it is not exactly the same as the target users of micro-trust, so I think there is a chance, mainly to see how they follow.

Tencent's micro-letter is also a user-oriented application, so he could not solve all the problems, this is the opportunity, but it involves a good operation and luck to do this thing.

Reporter: In the world, like based on pictures, a scene, a certain environment of mobile social applications, many have been developed, China has not such a good application, this is why?

Yes: There are several reasons why, first, the competition between startups is very fierce, the same idea, China came out dozens of to do similar things, and then everyone to rob users, ordinary users to see each of them in fact almost, and then maybe you use this, I use this, and finally put the user is not much of it is diverted; The second is that this kind of application to the end forever hanging on the head of a sword that people Tencent did? The result is that VC dare not support, the start-up company to kill themselves, Rob users, no one out, just like at that time to do Instagram so many, did not get the investment.

Reporter: So the pressure of the entrepreneur to do social application is also quite big.

Yes: Not that the pressure is very big, that is to say that if you do not come out, for example, the MO or get the investment, the valuation is also quite high, that is, if you say you can stand out in the middle, you can come out, there is always someone willing to gamble with you, but if you light in a few of the root of the torn between the killing has not been torn out, The ceiling is also thinking about the future of the micro-letter, which may naturally be more cautious.

Reporter: The Qing branch creates invests in the mobile internet to have what investment preference, besides game and O2O?

Yes: We all look, but the key is to see whether the entrepreneur can come out, the early team if they can make something special, we will still support. For example, I recently saw some of these things related to financial management, and I think there are many opportunities for vertical applications.

Reporter: The mobile internet in the Qing branch will be more inclined to the form of return, is the acquisition of the class, or the listed category?

Yes: Different, for example, the real social class, I think the future is expected to do a big company out, the game company we also cast a lot of early game companies we see mergers and acquisitions opportunities, at least more likely, because a game is done, you may earn tens of millions of a year, This kind of company I think may not be very likely to be very big.

Reporter: Some of the previous mobile Internet projects, presumably expected to get the first batch of return?

Yes: We have companies because many of the projects we cast were relatively early, in fact, we in the latter round, is the other VC into the time, sometimes they will choose, because many VC want to come in, we will buy our shares, we actually last year in several projects, this year has been able to get a return.

Reporter: In general, for example, you value, such as the classification, from the technology, from products, from innovation, from the model, these four points value is what?

Yes: For each project is not the same, I think I value more, the first is its innovation point, such as last year we voted "Houle three", is last year to do a more successful social game, this year I cast a good few games, I also think the game is not good vote, but at that time I vote "Houle three" The time is very resolute, why?

"Houle Three" is the seventh game of Tencent Open platform, several previous families have done, there are many users. But the previous six applications are "husbandry", what is stealing food, what Rob Parking, and operating a teahouse Yes, is such a number of applications. and "Three Houle" is the first strategy class game, there's a lot of innovation in the whole design, and you may not be the only one from the whole industry of the game, but they're the first to play a strategy social game, even before Zynga in the United States. So it's important to innovate.

Other applications, such as whether you can quickly get users, sometimes you are using some specific resources, or some specific methods, or really find the user needs, this is possible, so in different industries I think the point is not the same, as investors, we must first understand the pattern of the industry, If you do not know Tencent to do something, do not know 360 to do something, do not know what other companies are doing something, you vote, I think the risk will be greater.

We know that users are important, but now found a lot of users are also products, but found that the actual profit point is very weak, or that it has no way to continue to let the user loyalty, but it is a very early lap, I saw the potential, but I voted, the results found that its stamina is very weak. So the amount of user can not measure everything.

Reporter: The investment of early project of the Qing branch is generally in 500,000 US dollars, have the limit?

Yes: We are between 500,000 dollars to 5 million dollars, we are very clear, will not cast an angel, if you have not yet done, you are a few pieces of paper, then we will not vote, but if you do something, we invest in the smallest team is four people made a small app out, and then just on the line, we feel very good , it's zero income, but we think it can be cast.