The speech power of PPS: Investor's game and pioneering team

Recently Baidu completed the network television operators PPS wholly-owned acquisitions. The economic Observer reported that Baidu in the way of cash acquisition, the bid and the previous outgoing 350 million U.S. dollars, the highest will not exceed 400 million U.S. dollars. "It's not possible that we were earning several billion last year. PPS Sales Staff Zhang Hong (alias) to be Baidu acquisition was very surprised. The employee's department has a team of only a few people, bringing tens of millions of of the company's advertising revenue each year. And it seems to her that this is only the edge of the PPS sector.

As Zhang Hong said, PPS continued to profit, there is no shortage of cash. But it doesn't matter anymore. For a large number of mobile users, a good profit of the "potential unit" why to sell it? "Investors are anxious," admits one person close to PCCW. ”

Sprint IPO failed, after four rounds of financing, the equity has been diluted to single-digit number of PPS founding team has no autonomy.

At the same time, pps similar companies pplive to seek buyers news also intensified. PPLive chief executive Tao, in an interview with the Economic Observer, said that we would keep an open mind whether we would consider strategic mergers and acquisitions in the future or in the future.

As a former dominant user of the supremacy of the desktop player, pps and pplive have too many similar places: equity diversification, IPO stranded, financing multiple rounds. and hidden in the internet companies behind the capital of the big crocodile has been forced to the edge of the market.

The right to lose control of speech

Youku combined with potatoes played a scene in the PPS repeat. Prior to the IPO, the Potato CEO Wang had only 12.7% personal holdings, with the main body holding more than 80%. After the IPO, Wang's shares were further diluted to 8.6%.

And after four rounds of financing PPS, the founding team's equity has been fully diluted, and does not occupy a controlling power. "The executive team shares less than 10% per cent. A person close to PPS said.

At the beginning of 2011, PPS had attempted to launch the IPO. But in the middle of a slump, the Youku has not given overseas investors much imagination about the story of Chinese video companies. After the IPO, the stock market is fully ushered in the window period, including Thunder, Shanda Literature, easy media, including a number of domestic internet companies listed plans stranded.

Xiongfei, a video analyst, believes that listing is one of the best ways to return, both for investors and entrepreneurs, and to improve the brand and image of the company. Once the plan goes public, investors will opt out of mergers and acquisitions.

and Archie Art, Youku potatoes, music video network (300104, shares bar) is different, PPS has a game business income. And last year PPS in the game revenue of 2.3 billion yuan. In the copyright investment, PPS action compared to other video sites are much smaller. In addition, PPS Cumulative installed user has reached 500 million, monthly active a more than billion. According to the data of January this year, the monthly active number of PPS mobile phone was 27.5838 million.

For a large number of mobile users, a good profit of the "potential unit" why to sell it? "Investors are anxious," admits one person close to PCCW. ”

The PPS management team, which lost control, did not seem to have much enthusiasm for the takeover. "PPS does not want to be sold at this time. People close to PPS said.

March 23, including PPS President Xu Wei, co-founder Zhang Hongyu, including many of the company's top executives have stood up to publicly refute. At that time, pps in an interview with this newspaper also said: "This is a rumor." ”

However, it is noteworthy that Gan Jianping, the managing director of Qiming Ventures, said in an interview with the company that it is normal for enterprises to develop to a certain scale and make any financial investment or strategic investment.

Qiming VC invested a total of two rounds of PPS. It is also the only video company that Qiming Ventures invests in the video industry. The money comes from the first fund set up in 2006 by Qiming venture. Gan Jianping told the newspaper, "We invest in the enterprise dilution of the shares are relatively large." ”

Like PPS, PPLive also experienced 4 rounds of financing. It is worth mentioning that pplive in the third round of financing the introduction of the Shanghai municipal Government investment. When the fourth round of financing, Sun Justice settled pplive board.

A person close to Baidu said, in contact with PPS, Baidu also contacted PPLive, but finally gave up. "The price of pplive is not only high, but also more dispersed. ”

No surprises.

However, the demands of PE are different.

Since the acquisition is based on cash acquisitions, it also makes the attitude of investors different. "PCCW is not short of cash," the person close to PCCW said. ”

This seems to be no longer the concern of investors. "In the domestic internet market, almost all the sectors have been oligopoly, the future of the Internet will appear more investment mergers and acquisitions." Gan Jianping thinks, this also gives PE exit one channel more.

Tao that some people choose to withdraw from the present, some people choose to continue to struggle. The general failure in the process of mergers and acquisitions is a management choice to withdraw.

The waves are scouring the sand. In a few short years, the domestic video site from the peak of more than 300, to today's more than 10, and the success of the capital market is rare.

Up to now, only backdoor century listed cool 6 media, Youku, three of potatoes landed in the United States capital market, le Vision network by way of a domestic a-share, become the first listed Internet video company.

As the first Chinese video company to go public in the U.S., Youku has not done a good role model.

Even after the combination of potatoes, the price of Youku is still not more than 20 dollars, which is not as good as the two separate shares. Today, Youku potatoes are worth about 2.8 billion dollars. Even so, Thor, managing director of Highland Capital, remains adamant that Youku's valuations are too big. He is not bullish on a business model that is not profitable by the massive burning of money.

Gan Jianping that the capital market to the domestic video site attached a lot of imagination, now these stories can not be achieved. More importantly, the domestic video market competition is fierce, there is no absolute gap between video sites. This has also led to a plunge in the share prices of listed video sites.

In the loss of the "concept" and "story" of the US capital market, video stocks bring investors the predictable growth "ceiling". Some listed companies due to financial fraud caused by the trust crisis, the short institutions frequently do aerial stocks, let some listed Chinese Internet companies listed plans stranded.

Plateau Capital has invested in two video companies, one is the main network TV leisurely network, the other is and Youku the same video site 6 rooms. Now the net is still in the loss, 6 rooms have been completely transformed into a video dating site.

Thor frankly, for the former has basically abandoned investment. The timely transformation of the 6 rooms was relatively successful. "We invested very early in the network and now no longer invests, it is hard to make money in this area." ”

Although the video industry is no longer the way investors look. But for the previous years of the project, PE/VC hope to be able to find a chance to exit successfully. But not all buyers are willing to take it.

In fact, prior to PPS has been and including Youku, potatoes, Sohu Video and music network, including the first-line video portal has had contact, but the negotiations failed.

PPS has been Baidu and Archie Art Fancy, because both sides are highly complementary. Coupled with PPS in the mobile end of the entrance advantage is obvious, "PPS is integrated, to some extent, can speed up the process of Archie Art listing." "A person close to Archie art analysis.