Looking for "little fresh"

Absrtact: Data show that in 2011, China's internet has disclosed investment events of 202, the total amount of disclosure of the case investment of 6.74 billion U.S. dollars. After a flurry of investment and financing last year, the internet has become less and less hot, and last year a lot of real money was invested

Data show that in 2011, China's internet has disclosed investment events of 202, the disclosure of the total number of cases invested in 6.74 billion U.S. dollars.

Last year, a flurry of investment and financing after the hot, the internet has become less and more heat, the last year, a lot of real money into the Internet VC also ushered in a reflection of the season.

The internet industry has again become the field of venture capital accumulation in the last year, especially the electronic commerce picked the banner, Jingdong Mall, where guests, handles, the United States, the public comments and other well-known companies have carried out a number of rounds of financing, gave birth to an investment boom. The internet industry has therefore found a unique financing model: the Creation-financing-expansion-refinancing, the cycle of the chain, VC has become the most important part.

Looking for "little fresh"

Shenzhen Chuang Oriental Investment Group (hereinafter called Chuang Dongfang) recently finalized a new investment, Guangdong Province, a apparel E-commerce company has become the object of their latest investment.

The company for children's Wear field, the company was founded soon, and so far only a year, the first half of last year's independent Business Mall officially online. Although the media is still very difficult to see the company's overwhelming advertising, but its innovative business model, unique supporting services have made good results.

and other types of e-commerce companies are not the same, the company did not carry out large-scale financing, and did not follow the current popular expensive to introduce flow of the way, but rely on the company's own accurate market positioning, reasonable price strategy to obtain survival space. It is reported that the company is now a small profit, which is also the cause of the East value it.

This does not seek to expand rapidly, and the first to do fine mode is the Internet enterprises in a kind of "small fresh", they and traditional e-commerce rely on the strength of the capital and the expansion of the model is very different, so it appears special and novel.

"Small fresh" has distinct characteristics: focus on a segment of the market, the audience accurate, not rely on the overwhelming advertising to bring traffic, the company's own hematopoietic function, not dependent on foreign funds of blood transfusion can live; High user stickiness, Word-of-mouth communication, the user's brand loyalty is high. At present this kind of "small freshness" is getting more and more pe/vc of favor.

The company is only a breakthrough in the search for such "small fresh" companies in the east, followed by such a train of thought, another company to create a bright east before. This is an industry segment recruitment site, the company also with Zhaopin, job and other comprehensive recruitment companies are different. The recruitment site is currently the best domestic industry segmentation recruitment site, "the company from the inception of the full understanding of refinement, precision service charm and power." In the past few years, first from the industry segmentation services, has been initially developed into a platform based on the recruitment site, from industry segmentation, Regional subdivision and job segmentation professional services of the three-dimensional service pattern. In the company's introduction, it is also clear that in ensuring profitability based on the maintenance of high-speed growth.

The two companies let Chuang Oriental Chairman Xiaoshuirong Experience the Internet industry in this kind of "small fresh" small and beautiful advantages, he also said clearly that such an internet company that does not rely on large-scale burning of money to return to commercial nature and pursue profit as the basis for development will be more agreeable to investors.

Rethinking the investment model

In fact, the change began at the end of last year, the investment circle has begun to sum up the gains and losses in the Internet sector, the original model of the Internet industry is simply dependent on capital expansion has been questioned.

Take the E-commerce industry as an example, 2011 years, the electric dealer provoked the upsurge of internet investment, according to the latest data of the Chingko Research Center, 2011 1-December, the disclosure of China's e-commerce industry investment events have occurred 93, which disclosed the investment amount of investment cases of 77, The total amount of investment amounted to 4.691 billion U.S. dollars, breaking the 2010-year interbank investment record, and then creating new year highs.

But in this large amount of money to supply the electric business enterprise, but failed to let the investors and the electric dealers really make money. "Recently saw a few Chinese electric dealers, pleasantly surprised to find that there are Chinese-style profit model innovation: The main business is not to make money, but to earn different rounds of VC/PE money mainly." This reminds me of the Dutch tulip of the year, we all expect to be more stupid than ourselves. Citis, chief partner at SoftBank, said on Weibo.

Most of the electric businessmen from the internet industry, they have seen the market space for E-commerce earlier, but they have long been accustomed to the Internet business inertia thinking, the first to burn money to obtain users, and then Lasso business model. So, in the rise of hundreds of household electrical appliances companies at the same time to promote the same model, in order to seize the user, regardless of the cost of marketing, but access to new users more and more expensive, really retain a few effective users.

This model is summed up as "the creation-financing-expansion-refinancing", in this cycle, the profit is not the dominant factor in this model to advance, and the profit is not natural. Even the listed companies are not profitable, such as Tudou after the IPO is still in the loss, has entered the fast lane of the van, the east also has not been profitable.

China's Internet access to the United States, as well as the three systems of foreign investment and overseas capital markets, constitute a participatory system of the model, according to a leading venture leader. Now is not the time to come to a conclusion on this model, but this has created two "strange things" worth noting: first, internet start-ups may not have considered how to achieve profitability, but how to obtain investment in the wind, which is put the cart before the horse, to obtain venture capital for the purpose of becoming a business model; , the Chinese Internet users pay awareness is also in the Internet companies to spell the background of the slow development of the formation.

In addition to the business model of reflection, let the VC also some lingering fear is that some internet companies in the wind investment has distorted the values.

"When some internet companies get their money, the first consideration is to improve office conditions, move from ordinary office buildings to high-end office buildings, and then consider employee pay increases and benefits." "The above people sigh, not at all, 500,000, millions of salary also let a person distressed." This peep out some of the Internet start-up enterprises in the cost control of many problems.

Xiaoshuirong also believes that entrepreneurial stage of the Internet companies can not be too petty, generous advertising fees, high remuneration, comfortable office conditions and so does not fit, he said, internet companies should be more focused on products and services, can not be the fate of purely pinned in the use of very high advertising fees to smash out of the model.

In fact, regardless of active or passive participation, VC has played an important role in it, is the formation of this cycle of the core force of the chain. There are often VCs who propose "encouraging businesses to spend money, teaching enterprises to spend money" and so on, its expectations of rapid development of enterprises is self-evident; but it is difficult to grasp is that many enterprises are the direction and goal is correct, the money spent on the local driving enterprises to expand rapidly, in the absence of certainty, wantonly spend money, will undoubtedly accelerate the demise of enterprises.

After a round of investment, VC found himself cast out of the money is almost in the "skip", see the surface of prosperity, behind is a loss to make a yell, when the enterprise can not achieve capital expectations, hidden risks will gradually appear.