Shen Talk about entrepreneurship: Ctrip also went through some detours

"Entrepreneurs have to be able to change, constantly adjust their ideas; Investors have greater certainty about the project, and there are some deep judgments about the business model." This newspaper reporter Chenhuiying from Hong Kong October 26, such as Home Inns (NASDAQ: HMIN, hereinafter referred to as Home) on the Nasdaq successfully listed.　　This time, such as home issued a total of 7.9 million U.S. depository receipts, financing 109 million U.S. dollars, listed on the day such as home opening price of 22 U.S. dollars, higher than the issue price of 13.8 U.S. dollars 59.4%. Three years ago, Shen, the president and chief financial officer of Ctrip, led Ctrip to the Nasdaq and reopened the Chinese company's path to Nasdaq after the dotcom bust.　　Now, as the founder and co-chairman of the home, Shen two times in three years, the door of the Nasdaq, such as home to obtain a 30 times-fold oversubscribed, received a warm response to the capital market.　　Ring the opening bell, watched the stock high open high go, accept congratulations, all this, with the three years ago the scene of Ctrip how similar, but for the Shen, everything is very different. With Chenglu, the enthusiasm of the major investment banks over the Chinese internet has yet to warm up. Merrill Lynch, a sponsor, could only find a temporary analyst with an airline industry. But since then, with Baidu, the media, the new Oriental and other Chinese companies to the U.S. listing, a new venture in China, more venture capital funds also in different forms into China.　　In August 2005, Shen resigned from his position in Ctrip to invest in the Sequoia Capital China Fund (SEQUOIA). Shen, another partner with Sequoia China Fund, raised 200 million dollars in less than two months.　　Today, Sequoia China has been operating for more than a year and has cast tens of millions of dollars in more than 10 projects.　　November 7, when Shen returned to Sequoia Capital in Hong Kong Central Plaza Office in the interview, already as a venture capitalist, standing on the side of the capital.　　"Chuang" and "cast" when asked why will be Sequoia Capital selected as China's partner, Shen Feel, is the past experience has been recognized by the other side. Shen, who graduated from Yale Business School in 1992, has served in international investment banks such as Citigroup, Lehman Brothers and Deutsche Bank. 1999, Shen with Liang Jianzhang, hanting and other people together to create a Ctrip, and later initiated such as home, investment in the media and other projects.　　Today, the three companies are listed on the Nasdaq. From Ctrip to home, from entrepreneurship to venture capital, Shen's experience over the years has also allowed him to appreciate the importance of "system investment".　　Whether as the core of the entrepreneurial team or the investment banker, Shen's qualifications are quite rich, "Chuang" and "investment" combined to promote the Shen and Sequoia two-way choice. Ctrip is the 1999 Shen, Liang Jianzhang a few friends at lunch time out of the entrepreneurial ideas. The teamFeel the huge travel market, although there was no detailed data support, but he decided to resign his business. In order to project the Ctrip to the low-end cities, Shen began to look for the right media, and then noticed the media.　　At that time Shen did the so-called "due diligence", is to go with Ctrip market director Chat, got a positive answer to the new media, then did the personal investor ("individual investors"). "We all see the market ringing bell is very shiny, in fact, we are starting a business is to do some very basic day-to-day operation of things." "That year, as Ctrip CFO, some people think that there are many years of experience in investment banking Shen as long as the introduction of capital, listing these two things."　　But he actually spent 80% of his time on day-to-day management, engaged in three acquisitions, and studied the so-called "Six Sigma (6Sigma)", that is, how to design the process to enable Ctrip services to achieve a 99.99% satisfaction rate. Despite the success, Shen himself thought, "This is not a scientific method, human intuition is limited after all, to be validated by scientific things."　　"What he trusts is an investment decision made on the basis of prudent research, such as at home." After doing Ctrip three years, the idea of setting up an economical hotel chain is also gradually forming. At that time, has been in the tourism industry in the Shen and other people carried out a rigorous market research, for the hotel model, market demand, price and so on have a clear understanding.　　For example, such as home hotel location, can be summed up as "feeder street 20 meters", such hotels near the prime location, and avoid the positive competition with developers, cushion the impact of soaring real estate prices, and the lease period of up to 15 years, the cost is very determined. "Look back, Ctrip in fact still took some detours."　　Shen concluded that, in 2000, Ctrip had done some advertising with limited effect. "Entrepreneurs have the ability to change, they can constantly try, and constantly adjust their ideas." "But in turn, investors have greater certainty about the project, and there are some deep judgments about the business model," Shen said. "Optimistic, but more cautious" the most fundamental change in China's economy over the past 20 years has been the shift from manufacturing to services. The domestic consumer market will lead a group of enterprises, this theme is just beginning, it may continue for a long time. "This is Shen's" consumer demand Pull "theory, and he is now one of the main lines of investment. "In addition to China, only the United States has such a broad market, from Ctrip to home, the new Oriental and Grand are to meet the different consumer demand."　　"It technology provides a possible channel for services to reach a wider customer base."　　Sequoia's Web site listed nine Shennan investment projects, of which three are traditional internet companies, and the rest of the project in the insurance, agriculture, transportation, animation, outdoor media, lottery production and other traditional industries. Mention these projects, Shen familiar: "AThe new business model is the innovation and negation of the original mode. Every good project, competitive angle is different, no precedent can be copied. "In his view, the process of project selection is primarily a process of multi-level investigation of entrepreneurial teams, industries and business models."　　To look at the background of the entrepreneur, experience, understand the customer, partner to the entrepreneur evaluation, to get the industry statistics, to understand the various policies and regulations in the industry, for the enterprise has entered into the long-term, the normative of financial data is also the focus of the study. "Why is it that some companies have only a few multiples, and some business models can get more than 30 multiples, and some are still in pursuit?" Identifying the difference and potential of various business models is the essence of venture capital. "Not all profitable industries are suitable for venture capital funds to enter," Shen said. In other industries, policies are more influential and may not be suitable for private enterprise development. In fact, venture capital should also pay attention to the balance of investment projects and adjust the distribution of funds in different business cycles according to market conditions.　　In addition, the industry should be dispersed, to pay attention to traditional industries and emerging industries balance.　　Of the nine projects that Shen Cast, the Gold software (map software), the Palm Letter lottery (the development of software related to the lottery industry), Fujian Agricultural Group (vegetable planting) have entered or near the growth period, the remaining enterprises are still in the seed period. "Generally speaking, venture capitalists should be optimistic and passionate, otherwise how can you put your money in front of a person, a paper plan?" "But at the same time be very cautious, you decide to vote for each project at that moment, will be very satisfied with this project, have the slightest suspicion don't go to vote." "Sequoia Capital Shen in China was founded in 1972, headquartered in San Francisco, United States, the Monroe Park, another in China, India, Israel, three countries with independent venture capital funds."　　In its more than 30-year history, Sequoia has invested in many of the world's most important web-age companies, including Apple Computers, Cisco, Oracle, Yahoo, Google, and PayPal.　　As of December 31, 2005, Sequoia Capital has managed 18 funds, the total size of more than 4 billion U.S. dollars. Among the more than 500 companies that have invested, Sequoia Capital has successfully exited more than 200, including more than 130 successful listings and more than 100 successful exit cases through mergers and acquisitions.　　Sequoia Capital invested in the company's total market value, more than the Nasdaq 10% of the total price. Sequoia's investment style is usually to make decisions for people who know the best about the local situation.　　In India, Sequoia is the acquisition of a local operating a multi-year performance of the venture capital fund, the name of the change to Sequoia India, and then still with the same team independent decision-making.　　For the newly established Sequoia China Fund, Shen and his partner sail are real investment decision-makers, and Sequoia Capital's global team is only at the right time to advise. "We have a very close investment team with other countriesCommunication, but experience can not be summed up through the case, but to see how a fund to establish their own style of investment, how to do due diligence, how to make investment decisions.　　"Shen said.　　At present, some of the Chinese Sequoia investment companies, in some way is the United States of the same kind of successful companies, and India's internet trend behind China 3-5 years, China's experience just can be used for their reference. Shen's office in Central Plaza, a large screen on the wall of the main gate, has been showing the famous companies that Sequoia has invested in. Sequoia China's first masterpiece, Do not know which enterprise will be.