Curiosity-induced investment road visit NEA China Managing Director Xiaodong

Xiaodong Introduction: 2005 joined NEA, created a Chinese team and was responsible for NEA investment in the fast growing Chinese market.　　Mr. Chiang served as a collateral, a red child, a Sino-new force the directors of several companies, such as the pharmaceutical industry and the blue Apple, also presided over the investment of NEA, Citic Medicine, Li Tong Unlimited, Lan Hong Kong online, Lily Net and China Green Line, and participated in the investment of the Zhongtian branch and the exhibition communication. "I am naturally more curious, like to touch new things and to meet strange people," he said.　　5 years ago, Xiaodong, a new energy company in Silicon Valley, was driven by curiosity to enter the NEA of one of America's biggest venture capitalists.　　Now, as the representative of Young VC under the age of 40 in China, his career change has been linked to the hottest companies in China, such as red children, new Chinese forces, and other payments. For 5 years, Xiaodong has been studying. As the most successful venture capitalist in the world, the huge NEA manages 11 billion of billions of dollars, invests more than 600 projects, and has a lot of seasoned investors. "VC is an apprentice business, there is no textbook and system theory can be said, are followed by human learning." "Xiaodong is very lucky to follow the company founder. "They have more than 40 years of investment experience and have invested in many successful companies such as Intel and Apple," he said. I learned how to look at business and how to look at business models. "Five-year investment of 300 million U.S. dollars in China increased at the end of 2005, as the only Chinese NEA team, Xiaodong returned to set up the NEA China Division, currently, NEA in China invested 300 million U.S. dollars, about 20 projects."　　An average of 5-8 projects per year. Xiaodong that this is a normal investment rate. "If we invest 20 to 30 projects a year, we don't think we have time to manage them." From our experience, we have to do a lot of work before and after the vote, so at present, 5-8 a year is a normal speed. "From the investment stage, NEA China's major investment in two types of enterprises: first, the early growth of enterprises, one is a long-term enterprise." Early-growing enterprises have some customers and sales, business models are gradually proven, through the expansion of the market and customer base in all aspects of the further verification process; As long-term enterprises have usually been proven in a certain stage of the business model, the question is how to become industry leading enterprises.　　In other words, similar enterprises may have 50 to 100 enterprises of the same scale, and how it can leap, become the industry leader, this is a long-term challenge.　　Last year's outbreak of the global economic crisis, but also let the VC appeared polarized, a class of VC slow down the pace of investment, more cautious; another type of VC thinks, now is a golden time. "Since last September, we have been more cautious in investing, but not stopped investing," he said. In fact, we are still very active in looking at the business, can even say more positive look. We've invested 2 companies since last September, and a few are at the bottom of the flow.Process stage. Xiaodong said the financial crisis had little impact on NEA and that the Fund had 4 billion dollars in cash to invest. As a 30-year-old Vc,nea has experienced many economic cycles. When NEA was founded in 1978, the economy was at a low ebb. [Page] The Chinese market in NEA overseas investment accounted for half of the future investment direction is to further increase the investment scale of the Chinese market. "Our immediate goal is to expect China to have a 15–20% investment ratio, but this is not a hard target because we are a global fund and the final investment depends on market conditions in 3 locations in the United States, China and India," he said. "Specific to China's investment strategy, xiaodong that the essence of investment is similar, the overall system can also be grafted." "The difference is that the background is different. The judgment is based on the understanding of the background, which is different from the United States, which is followed by the market opportunity to take the project into your assumptions. The purpose of investment is to repay and how to make money. "The core of NEA's overall investment system focuses on the nature of business models as opposed to other traditional vc,nea. This is a very systematic fund, larger than the general VC, investment stage and industry are very many. "If a 200 million dollar fund may not need to be systematized and structured, it may be decided to sit down and talk about the project," he said. Once the fund has reached 20 or 3 billion dollars, it cannot do so. Because it is possible to invest in hundreds of companies, it is impossible to know what everyone is doing, so there must be a system process and a set of management methods. "In the eyes of Xiaodong, this is a NEA set of more unique and worthwhile learning systems." "Perhaps some big PE, buyout funds and big investment banks have similar systems," he said. However, NEA let me not only learn how to do VC, but also learn how to do PE. "If you look at the size of the fund, NEA looks like a middle market pe." We invest early in the growth period, to the listed companies and other stages of the enterprise. If in a small fund, there is no chance to contact the listed companies, in the NEA can be systematically exposed to a lot of investment level. Although some projects do not do their own, but have seen and participated in decision-making, but also learn a lot. "Look at the project and decide whether to invest. Each VC has its own set of statements, what technology, team, business model, market and so on.　　In Xiaodong's eyes, the nature of the problem is the same, to see whether the enterprise can build a sustainable competitive advantage in the fast-growing market segments. Xiaodong stressed that the first look at the fundamentals of business models, and then look at the core of the business model to support the key elements. The essence of business model is to invest 1 dollars to earn a few dollars, and some business models are better models, such as QQ and Microsoft. Besides, we should consider other core elements, factors of competition, factors of market, elements of management and so on. "To do one thing, 10 elements inside there are 6 that can be done ifYou have 9, you don't need us to invest. But usually a lot of projects, only 4 elements, this time to think about whether to vote.　　"Bullish on e-commerce health care industry from the investment industry, NEA in China, the main investment in several types of industries: one is the science and technology (including new energy, advanced manufacturing), one is consumption, there is a biological medicine. "We have been optimistic about E-commerce, although e-commerce in China is still in the early stages of development, but we were very conscious of the layout." Feel that just doing the internet is not enough, many enterprises in China to do tens of millions of to 100 million after do not go up, not in China's Internet itself, but in China's retail environment and the nature of the foreign countries are different. Xiaodong For example, buy a pair of shoes in the Amazon, the whole United States is a unified purchase price, in China do not.　　In China to do e-commerce requirements of supply chain management, including procurement, logistics, clearing and other links, must have a strong support. In addition, Xiaodong is very optimistic about the investment prospect of electronic payment. "I think payment is the bottleneck of E-commerce, so the investment of technology, is to do mobile phone payments, last year, trading volume of 30 billion yuan." Both in terms of income and profit, should be ranked in the forefront of China. Taobao on the next order, 1/3 are invalid or ultimately not completed, because of the problem of payment, so there are a lot of offline payment requirements. Online orders can be joined repeatedly convenience stores, newspapers and kiosks, such as online channels to complete payment, this model is still very promising. "The health care industry is one of the key investment areas in NEA, and the health care industry is a relatively broad industry, including medical services, medical it, biopharmaceutical and medical devices."　　Xiaodong says there are investment opportunities in these areas. "Health reform will bring two changes: first, traditional drug consumption 80% in the hospital to complete, and gradually there will be a process of change, pharmacies, such as the proportion of retail channels will rise; second, the same is the hospital sales channels, the market concentration is greater, the strong stronger, the weak are eliminated. "Xiaodong Investment in Citic Medicine is such a national pharmaceutical circulation industry leading enterprises." [Page] RMB LP has yet to mature nowadays, with the gem approaching, RMB funds become one of the hottest topics.　　However, the reporter contacted some foreign VC to talk about this topic, have become very sensitive. Since last year, there has been a lot of speculation outside the NEA renminbi fund, Xiaodong declined to disclose a specific timetable. He said: "In the long run, there will be renminbi funds to consider, but not to say that a renminbi fund must be immediately, will do it at the right time." "As for the way the renminbi Fund cooperates, Xiaodong Frankly, it is certainly a partnership with local resources." "China's current LP is not mature, private LP is rarely mature, so not only we, it is estimated that most of the peers are with government-backed institutions." "In cooperation with local governments, investment is inevitably regional." In this regard, xiaodong that from the other side of the point of view, fully understandable. "Whether it isState-owned LP, or private LP, have a mature process. China's money is the first generation to earn, this and the third generation, the fourth generation inherited the money is not the same. The American LP Tube's money is the third generation, even the fourth generation of money, these people are lying on the beach, their mentality and requirements are not the same. At such a specific stage in China, the RMB LP also has a mature stage.　　"Do not do VC what?" Estimated to be comparable to flight attendants flying time, is the VC. Often they are not at the airport, they are on their way to the airport.　　When it comes to hobbies, there is nothing to do with it, because there is so little spare time that there is not much free time to spend. Xiaodong is going to pass the airport about 3 days a week. Other times, he likes to concentrate as much as possible, if it can be compressed to half a day or a half-day best. "I'm going to leave some time for myself to think, I prefer to write, and I'm involved in writing some investment reports." This is actually the time to clear the train of thought, although the time is very small, but still want to try to squeeze time not to answer the phone, concentrate on writing something. "The choice to do VC, is because of curiosity." If one day does not do VC last article