Cash can be said to be the lifeblood of an entrepreneur.

Entrepreneurs make decisions must see their endurance how, to think of what the worst results, can not only do optimistic ideas, cash flow must not be broken.

In the 2010, we will pursue entrepreneurs and investors with rich entrepreneurial experience in China, and invite them to share their entrepreneurial journey in different fields, and give enlightenment to entrepreneurs. In this issue we visited Donghua Software founder Schachendon, who specifically asked him to share a deep understanding of the software industry and the experience of mergers and acquisitions, and he also advised entrepreneurs who are interested in the software sector.

Known as the "North Ufida, South Kingdee," said the Chinese software market, in fact, is a Canglongwohu, a group of enterprises rooted in the field of application software, although not more people pay attention to, but has been a steady development, stuffy sound fat. 2006 in Shenzhen, SME listing of the Donghua software (sz 002065) is one of them, the company's 2009 revenue has reached 1.549 billion yuan, net profit of 241 million yuan, over the years the average growth rate of more than 30%. Schachendon, founder, said: "It seems to have inadvertently developed to today, There is nothing in the ups and downs of the story, the lack of media like the legendary color. ”

Schachendon, founder of Donghua Software

After the listing, Donghua software has more space to manoeuvre, and began to try to expand the main business by means of acquisition. 2007, Donghua Software successfully acquired the joint Silver Tong, which is also the first SME to the unrelated third party to issue new shares of the purchase case, the acquisition of the new Shenzhou case is also operating in the process. Although the global corporate mergers and acquisitions history of failure cases are not uncommon, but Schachendon still for their own practice is more satisfied: "Our acquisition will focus on synergy, and the core of the software industry is talent, after the acquisition will retain the original team, otherwise will not do." ”

Professional focus and cash flow

"Entrepreneurial State": Donghua software so many years of development has been relatively stable, do you have any tips?

Schachendon: In fact, there is no secret, the main reason is that I am familiar with this industry, to the market see very clearly, where there are business opportunities, where there are risks, are more understand. For a person of my average IQ, it's easier to do the most familiar things, so we're not expanding into other areas. In fact, diversification and specialization in the business world have a successful precedent, but in the early days of entrepreneurship, it is best to professional, focus, the relative success rate will be a bit higher.

When I was working in the mechanical department, I contacted a lot of foreign companies and saw how they worked. It was just the stage of China's economic take-off, I also accumulated a certain amount of customer resources and upstream and downstream relations, so do not have many difficulties. Moreover, do not need to do software too much start-up funds, relatively easy to do.

"Entrepreneurial State": as a more successful entrepreneur, what advice do you have for young entrepreneurs who are now entering the new software field?

Schachendon: In addition to professionalism, focus, if you want to start a business in an industry, it is better to have the opportunity to go to a similar company to hone a few years, you can observe the business opportunities, to see what the existing technology deficiencies, and then to ponder. Of course, this is not an opportunity for everyone, but at least you have to study existing similar companies and analyze their strengths and weaknesses.

Many technology entrepreneurs may be very enthusiastic about technology, but too stubborn to listen to other people's opinions, and do not care whether the market likes their products, which is not workable. Entrepreneurs should continue to listen to customers and industry experts advice, improve their product development and marketing ideas. If a tech entrepreneur doesn't understand the market, he may be able to make a Nobel Prize, but not a business.

In addition, entrepreneurs must have dedication, diligence, perseverance, not just to earn some money or to feed the family, from the heart particularly like this thing, as their own life.

"Entrepreneurial State": You have not encountered any difficulties in the entrepreneurial process?

Schachendon: Basically not, first I am more cautious, secondly I pay great attention to cash flow.

You always have to remember that cash flow is the lifeblood of the founders, the cash flow is broken, there is nothing, the bank is always xianpinaifu, when the money chasing you to pay, no money when he will not give you money. We have been keeping light assets running, and many local governments want us to invest in building software parks, and I say it's OK to set up a company, but not to buy or build a house. As far as possible not to deposit funds into fixed assets, to ensure that enterprises have sufficient cash flow, it is more comfortable.

I still have an experience, make decision must see oneself endurance how, want to think the worst result is what. Many people make investment decisions, only think of how much money they have to invest, how much money can earn back, but it is easy to forget in case this input back to do? It doesn't matter if you can withstand the worst results. In this respect, I belong to the stable type.

"Entrepreneurial State": When you first started a business is also a person, no other entrepreneurial partners?

Schachendon: At first I made my own company. I think that the early start of the enterprise equity concentration on the development of enterprises more favorable, less friction, can do a good job in product development and customer service. It would be nice to have a few entrepreneurial partners with the same goals as Hewlett-Packard did, but in case of co-ordination it would be problematic. In Zhongguancun I have seen a lot of start-up companies started is a few people together to do, to a certain scale are separated, it is easy to conflict, fighting. My summary is that if it is not very necessary, the beginning of the business of the best to have an absolute core of people, the right to centralization of power.

Acquisitions need Synergy

"Entrepreneurial State": we see in recent years Donghua software bought some companies, how to consider?

Schachendon: When I was on the market, one of my motivations was to have equity payments for industry consolidation, which was what many companies in Silicon Valley had done before. My experience over the past few years is that in order to succeed in the acquisition, we must consider whether there is synergy between the two sides: Technology synergy, Market synergy, service Synergy, so that both sides can develop well. If the acquisition target can achieve these three kinds of synergies that is the ideal, if only brilliantly can also consider.