Kai-Fu Lee: We didn't kidnap entrepreneurs, people envy envy

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Kai-Fu Lee (Tencent Science and technology with map)

Tencent Science and Technology (Lei Jianping) August 9 News, Kai-Fu Lee and his innovation factory recently plunged into a "big share" storm, however, Kai-fu Lee quickly use personal micro-blog to clarify. Kai-Fu Lee pointed out that today's innovation Workshop 50 projects on average 17.6%, there is no "big share", entrepreneurs are still the owner of the enterprise.

Recently, the Innovation Factory completed a new round of fundraising 148 million dollars, and through the SEC disclosure, but also to confuse the outside world, Lee Kai-Fu explained that the innovation Workshop did not release financing news, but because the LP has U.S. investors, so according to the regulations, Innovation Workshop to the SEC to do the necessary filing.

The outside world may envy the Innovation factory

Compared to other investment models, innovation workshops, in addition to their own investment, also to the entrepreneurs to provide venues, recruitment, training, early financing services, there is a misunderstanding is that in China's Internet arena, innovation factory this model accounted for a high proportion, but will make the entrepreneurial enterprise learning business knowledge, and the growing more dangerous, Even facing the giant strangulation.

NetEase CEO Ding Lei recently also openly ridicule, said the innovation workshop than NetEase, "we in addition to money there are management experience, user groups, and their boss also has no entrepreneurial experience", alluding to Kai-Fu Lee only professional managers experience, investment projects difficult to succeed.

In this respect, Kai-fu Lee in the Micro-blog response to "mutual encouragement", said let the facts speak, Innovation Workshop initially several projects, including pea pods, snacks, friends, pudding, application sinks and other projects have done very well. They can quickly become a leader in mobile internet, largely because of the full range of support offered by innovation workshops, such as a 500,000-letter resume library for recruiting.

Kai-Fu Lee said that the innovative factory model is not to say, like nannies, for entrepreneurs to do everything, but let entrepreneurs less detours, all things have to learn and lead entrepreneurs. The entrepreneur is the owner of the business from the first day of the innovation Workshop model.

Moreover, the entrepreneur chosen by the innovation Workshop is not ordinary, these entrepreneurs such as Dot Network CEO Xu Chang (Weibo), Dessert CEO Zhang Lei, CEO of the application of Rochuan (micro-bo), and so on, are from well-known industry companies, very experienced, the average age of about 33 years old, so entrepreneurs must be able to withstand the "after graduation" of the barbaric growth.

Without innovation workshops, an entrepreneur might spend half of his time in the non-product business in the first 12 months, and the value of innovation workshops would be to help save half the time. Innovative workshops will play a very important role in recruiting, legal norms and corporate culture. "We help entrepreneurs take fewer detours, make products faster, and help entrepreneurs become better leaders, rather than becoming greenhouse flowers that can't grow after they go out," he said. ”

"When a VC takes real money to take over our hatched projects at a higher price, when 500,000 engineers come to us to look for jobs, when the Silicon Valley godfather is looking for our investment ... These are all evidence of our positive influence. ”

If someone has a great project, does not choose a creative plant, runs somewhere, or engineers say they are willing to go to any VC project without participating in the Innovation Workshop project, it will worry the innovation factory, Lee said. "If the outside world is just some kind of envy and envy of the innovation factory, we will not care too much." ”

Mobile Internet tool age enters a new stage

Compared to last year's entrepreneurial boom, Kai-Fu Lee admits that the number of entrepreneurs now is lower than last year's peak, some of the less powerful entrepreneurs see the Chinese concept shares fall, the market window closed after the shrink down. "Everyone will read the newspaper, to see who's stock down how much, it does hurt some enthusiasm, this is not necessarily bad, the news is affected by entrepreneurs, in fact, not the most powerful, perhaps they should not start a business." ”

Kai-Fu Lee believes that really capable entrepreneurs will not be frustrated by these problems. "The founders we see are going to be a little bit less than the peak last year, but not so much," he said. ”

From the innovation workshop, the major investment in the past 2 years the main direction, the first is based on the Android Ecosystem project, the second is the game, the third is social, the fourth is the LBS-related O2O project. Like the investment of peas, snacks, friends, applications, etc., are based on Android projects.

The graffiti move is based on mobile social gaming apps, while the Cloud is a cloud platform for social gaming, and Lei is based on HTML5.0 platform, and Le Dolphin and cheertone home are children's games on the ipad. The investment of the pudding and the hotel is all a project in the field of the social field.

Kai-Fu Lee pointed out that the innovation workshop for 3 years has been doing a subdivision of investment. 3 years ago, Innovation factory thought that Android and iphone would overtake Symbian as a mainstream development platform, and that the most needed was mobile Internet tools, which is why peas, friends, apps, and magic charts were born. Now the age of mobile Internet Tools has entered a new phase, no longer has the biggest growth.

The following is an interview with the Chairman of Innovation Workshop Kai-fu Lee:

Tencent technology: According to the SEC disclosure of documents, Innovation Factory has completed 148 million of billions of dollars in financing, this is the last year after the financing of refinancing. Why this time to announce the financing, but also through the SEC announced that you are not listed companies, we do not understand this matter, there are many online.

Kai-Fu Lee: We did not release the financing news, we do not make any release, even we can not talk to you about the fund-raising. Because we have US investors in our LP, we need to make the necessary filing according to the rules. There are also laws in the United States: You should not talk about your financing process when you raise money. So I can't answer your question.

For innovation workshops, the last fund ended last September, and the general financing process could be around 12 months. The general VC or investment agency will also manage several funds at the same time.

Tencent technology: The latest outside of the innovation Factory has a misunderstanding, as investors accounted for a large share of the problem, you clarified that the average share of 17.6%, we are concerned about the proportion of 17.6% of the shares, this proportion is how to calculate out?

Kai-Fu Lee: We have a confidentiality obligation on founders and other investors for each project, it is impossible to make 50 projects public. At first we did a few internal projects, the idea came from the workshop itself, in the outside was unable to find suitable entrepreneurs, we only have their own initial lead, but also personally to find the first group of engineers, so the innovation workshop accounted for more.

But this stage is over, because everyone's role should be clear. We are investors, we should not play the role of entrepreneurs. In addition, with some initial results of the first year, the situation of not finding an entrepreneur is also in the past.

Innovation Workshop investment is not limited to the early

Tencent Science and technology: specifically speaking like dot dot net this kind of project that does not belong to inside Hatch, innovation Workshop occupies how many shares?

Kai-Fu Lee: There is no standard to invest in the shares, in fact, investment is not really I want to account for a small share of the problem, an entrepreneur should have a plan to say how much money I need in the next few months to reach my next indicator. This is a number he has, and more importantly, whether the investor is willing to make such a sum of money.

The second question is what proportion of the money you are in, but you are asking what is a reasonable valuation. This depends on a number of factors, such as (1) The attributes of a project, such as social events, games, O2O projects, and (2) the experience of the founders, the founder of the star, the founder of the experience, the director of the big business, or the first founder, all bring different values. (3) When financing has been done to what extent, such as only ideas, a business plan, a prototype, or already have some users. All three factors affect valuations. The ultimate investor ratio is how much money is needed divided by a reasonable valuation.

Tencent Technology: You recently said that see two very good projects, have angel investment, find innovative factory to cast a round, innovative factory is also willing to consider, but the angel actually accounted for 75% shares, and refused to give up, such an example of many?

Kai-fu Lee: not common, individual cases. In the past three years, many angel investors have come out to invest in different projects, our investment is not limited to early investment, entrepreneurs took the investment angel's money to do a year two years, come to us to find the next financing, or very welcome, we will also find a number of cases, the investment intention is also relatively strong. But it turns out that there are some angels who share too much, and this leads to a few of the phenomena I mentioned on Weibo.

First, the founder does not have enough motivation and enough share to promote the project, the second is the founder loses the sense of ownership, third is too early to deprive the founder of the company control power; four is the angel holding structure is difficult to attract the top VC. So we have no way to get involved in such a project unless angel investors are willing to adjust or sell shares. But in that case, what about why? Let the entrepreneur be the owner of his company when investing.

Tencent Science and technology: I still want to cross-examine the early project of Innovation Factory, you set the direction, find the entrepreneur to do, some investors believe that this model in China's business model, the bigger the more dangerous, the Chinese Internet is a jungle principle. When you are small, you are growing up in the garden, when the bigger, in the jungle, may be difficult to withstand the sword of the river, how do you think of this view?

Lee: I have two answers. First: Innovation Workshop The first few projects are now growing well, let the facts speak. Today's alliance, pea pods, snacks, application sinks, pudding ... For all to see, is the industry leader. Second: We have abandoned this model as early as two years ago, so let's talk about other issues. #p # subtitle #e#

Tencent Technology: The abstract point of view, entrepreneurs should be able to provide a lot of services to investors? Or just find the king to take the money, others to go through? Innovation Workshop more recognition of that mode?

Kai-Fu Lee: There is a controversy in the industry. Some people think: "Entrepreneurship is barbaric growth." A high service environment may help you to a certain degree, but if you leave the greenhouse and you go into the jungle, you will die. "Others think:" Entrepreneurial competition is extremely fierce, time is money. If all of their own, take a lot of detours, waste a lot of time, most likely by other companies beyond. If there are experts who can help solve a variety of trivial problems, let entrepreneurs focus on entrepreneurship, this is the way to success. ”

In fact, both of these statements make sense. Innovation workshops try to provide high quality service, but not a greenhouse.

Innovative workshops provide a full range of entrepreneurial services, for example, we have 50 resumes, we have senior forensic finance experts, we have user experience, architects, product experts, when you need to give you advice, because in their field, perhaps they compare more experience.

But these services do not mean that we help you to do everything, but hope that through our services, so that you take less detours, all things or entrepreneurs in which to learn, their own leadership. Take us to invest in every entrepreneur, is an entrepreneur-driven enterprise, he has a large stake from the beginning, from the first day who is the boss is very clear.

Second, we choose the entrepreneur also must choose to be able to savage growth of the entrepreneur, relatively still have more experience. Most of the cases are very experienced entrepreneurs, with an average age of about 33 years, so entrepreneurs can certainly withstand barbaric growth. First time entrepreneurs we also vote, but relatively few.

Third, each of our added value, are very clear, so that entrepreneurs less detours, teach you how to do: We have a huge resume library, take you to campus recruitment, we have a standard legal framework ... But never say you don't learn anything, or you will be lost after you leave. It is the process of teaching him that he learns how to do it. The bigger challenge is that there are so many distractions in the first 12 months that you can't focus on the product and build the company culture quickly. And our value is to make them more focused.

If the entrepreneur is doing something other than 12 months in the first half of the year, we want to cut the time again and get you back to the product. Finally, through the product to let users speak, performance talk. We help you take less detours, make products faster, and help you become a better leader, rather than making you a greenhouse flower.

Perhaps the outside world is envious of the innovation factory

Tencent Technology: Before NetEase CEO Ding Lei ridicule you, said you do not have entrepreneurial experience, there are anecdotal rumors that some investors are a little contempt for innovation factory, said you are not a businessman, in this respect is not too much business knowledge, if blindly spring will go to do VC cannon fodder, I do not know this kind of talk right, What do you think the outside world says about you?

Kai-fu Lee: Except ding lei, I really did not hear. I think it's all about the results. Today I feel that although we are a little early investment institutions, but whether from the entrepreneurs we choose, or the company we invest in the pace of development, as well as the probability of entering a round, including those who are ultimately with us to invest in the VC list, the overall reach is very good results. Of course, from the speed of our fund raising and the quality of our investors, we are also recognized.

If we don't do well, why do we have 500,000 resumes? If we do not do well, why do we have Zhang Lei, Rochuan, Xu Chang, Majnoon these star entrepreneurs? If we do not do well, why Shanghai, Beijing have local institutions, partners are willing to give us all kinds of help, so that we have a better environment ? If we do poorly, why do we have good institutional investors to get us to finance again?

When an entrepreneur puts his trust in the future in my hands; when a VC investment in the real money in our earlier companies, when an institutional investors are more willing to let us make money for him, when the engineers in the future can have a lot of road choices, but still come to us to find work opportunities ... These facts are sufficient proof that we are recognized for our work.

Back to your question: if anyone has a great project, refuses to invest in innovative plants, takes someone else's investment, or engineers say they are willing to go to any VC project without going to the Innovation Workshop project, these are the things I care about. If only some people are envious and jealous of innovation workshops, speculating about our shortcomings and singing down our prospects, we will not care. I believe that the results of the future will explain everything.

Small companies being bought by big companies is an acceptable outcome.

Tencent technology: Now do a better project, such as pea pods, application sinks, in the field, opponents are also biting tightly. Will some of the more capital, or the operators, be able to strangle these projects in the creative workplace?

Kai-Fu Lee: This is the whole of China's entrepreneurial challenges, I think in China really can not because of a project to get a round of financing, with 10 million of dollars, think they have no problem, the future is very smooth. In fact, any such company can not be sure of success.

Every startup should be jittery about what to do at every stage. and large companies on the one hand there is competition on the one hand can also have cooperation. Small companies do not need to think that in front of large companies there must be no survival opportunities, but I think large companies also have a lot of short boards.

Big companies have the baggage of the past, there are more processes, without the power of master, may be distracted by a lot of things, there may be internal struggle, the entrepreneurial direction although he also do, but may not be his main business, and may be because you are more focused, your life is tied here, so that you work harder to do, To achieve better results.

These reasons give us a chance to see a small company, and there are reasons to sprint. Even under the competition of big companies, you can choose a way of partnering with one of them.

But I also admit that today, millions or tens of thousands of users of Internet companies, there must be a number of large companies strangled. As investors, we will try our best to help our investment companies, go more smoothly, we also know that in the hearts of 100 companies, not in the hands of large companies die 10, 20 is not normal.

Not only in China, but also in the United States, there are a lot of dead companies under Microsoft, Google and Facebook. Last but not least: if you're really a step ahead of a big company and you walk well, maybe he'll see you and buy you. It is not an acceptable outcome for a small company to be bought by a large company.

Innovation Workshop I can't say 90% success rate

Tencent Science and technology: Online said innovation Workshop investment success rate of about 90%. How can this high success rate be maintained?

Kai-fu Lee: At present we cast 50 companies only died four, but this does not mean that more than 90% of the success rate. If the use of access to a round of financing as a standard, there are already 17, and is 17 good VC investment. But frankly, most of these companies are in the early stages. There are nearly 30 in development. Moreover, these 17 are not really meaningful success, we dare not say the so-called 90% success rate.

Tencent Science and technology: Now go better point project like peas, snacks, has been out of the platform of Innovation Workshop, moved out how to let it go better?

Kai-Fu Lee: This needs to rely on the entrepreneurs themselves, the main contribution of innovation workshop in the early stages of the project has contributed to the. In the early days, the first 12 months of the company's most likely demise helped you set up a business development direction, product development direction, technical framework, to help you find a group of management team and engineers, to help you do a certain marketing, as well as through our brand and recognition, to help you find the next round of financing ... And these help values are huge.

Once we graduate we may not have much time to focus because our greatest value added has already happened and we need to focus more on the new investment projects. Of course, we'll still be on the board and can come to us when they need help. But the greater degree is on their own, after graduation we still have a lot of lectures, activities to provide support, but we are no longer a key role.

Capable entrepreneurs are not affected by the capital environment

Tencent technology: From the capital industry, the sound of venture financing this year is much weaker than last year, many people now say it is the winter of entrepreneurship, you think this winter will last?

Kai-Fu Lee: Now is a listed winter, for a long time no domestic companies listed abroad. On the one hand, some listed companies are questioned abroad, on the other hand, there are some poor performance, coupled with China's economic problems, the market window is basically closed, even if a good company listing, will encounter a lot of challenges.

As a start-up stage investor, we are not concerned about listing issues, our investment companies are far from the listing.

Everyone will read the newspaper and see whose stock has fallen, it will certainly hit some people's enthusiasm, but this is not necessarily a bad thing. And we think: easy to be affected by the news of the entrepreneur, in fact, the heart is not the most powerful. Those who have the idea, the ability of the entrepreneur will not see a certain company share price down, or So-and-so VC do bad, or a certain start-up company faced problems, will not start a business. The entrepreneurs we see are going down a bit at the peak of last year, but not much, and really capable entrepreneurs won't be frustrated by these problems.

Tencent technology: I see your business in Shanghai immediately opened, can you tell me about your business progress this year?

Kai-fu Lee: Shanghai is about to open. We have a small investment team set up, and now a lot of time in Beijing training, because it will take some time to fit into our family. has already invested in a Shanghai project and continues to look at the project.

Tencent technology: There is no thought in addition to Shanghai, other places will be opened. You also said that the local government is very welcome to you.

Kai-Fu Lee: We have been invited by many local governments not to consider other places until we have made Shanghai a success. Just as we do not have a bit of success in Beijing, we do not think we are qualified to go to Shanghai. Otherwise our little team would be too distracted.

The end of the era of mobile Internet Tools

Tencent Technology: The Establishment of Innovation factory 3 years ago, investment direction has changed, I remember you are to the mobile internet, cloud computing, electricity and other fields, now the change is?

Kai-fu Lee: Those directions are just the general direction, we have been in the field of investment in subdivision. As a founding investment organization, we remain ahead of many investment institutions in the forward-looking aspect. In the beginning, the four directions are just the direction, the general direction itself is not too much guidance. We will do a lot of research in the field of segmentation, for example, there are many areas of mobile internet, we think that the tool will have a future.

We have judged over 2009 years that smartphones will go beyond the functional handsets and see Android and iphone overtake Symbian as the mainstream development platform. See apps will be the space to rise, based on this judgment, we think the most needed area is the mobile Internet tool-type entrepreneurship, including peas and pods such as synchronization tools, friends, such as the developer tools, such as the use of store tools such as the magic map such as camera tools ... Today the facts have proved our judgment, and we can see that the products of these tools do get a lot of praise.

Now the mobile Internet tool era is no longer a good blue sea, there are many already big start-up companies, large companies have begun to enter, is no longer the best entrepreneurial opportunities, is no longer the biggest growth of the field. So after investing in tools, innovation workshops have made a number of investments in social, mobile games, mobile gaming platforms, and O2O areas. We are working on a new direction of investment, and when you see the products we're investing in, we'll be able to guess what our initial direction is.