web2.0 Ebb Internet entrepreneurial era will end

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For a long while, Che Hui decided to leave the net he had founded more than two years ago. For this but 29 years old, but participated in Baidu start-up phase of young people, life is like a circle. When he left Baidu in 2003, he was already one of five members of the company's technical committee. 2005, he started entrepreneurship, Angel funds from Baidu co-founder Xu, partner is Baidu's another former colleague Lin Chenming.

At the beginning of their business, they tried to develop a video playback speed-increasing technology according to their own points of interest. But as the project deepened, and the rapid rise of an American video site called YouTube, they decided to join the larger game.

But not coincidentally, a see network did not usher in "American Idol" type of rapid take-off. Earlier potatoes, Youku and other rivals than a net to get more money and users. And the video of the server and bandwidth requirements are extremely high area, so that a network of funds is very tight.

If Baidu's early growth experience taught Che Hui what, that is, in the continued adjustment of strategic direction. Aware of their presence in the Red Sea, a technology-conscious team transition into the community area, while shutting down the video business. New goal: MySpace.

But just as Zhou, the top 3721 founder and chairman of Qihoo, commented: "Now I estimate that at least 200 websites are currently learning YouTube, and 500 sites are learning MySpace." See the net seems once again wrong. Later, they make a business direction adjustment every once in a while: from providing custom wallpaper, to the recently developed client track of tracking network information. Che Hui said, sometimes, he would ask himself: if he insisted on doing video playback speed technology, today will not be different?

There is no answer. But what is certain is that even if the net becomes "China's YouTube", the days may be just as bad. One of the current leaders in the field, Tudou, has raised 85 million of billions of dollars in four rounds of financing, but a clear and sustainable business model has yet to emerge, and too complex a shareholding structure to make its future hard to ponder: is it as profitable as Sina to be divided by its shareholders? There are rumors in the industry that recently, at Tudou's board, Wang barely spoke. And with the relevant policy departments of the video site supervision of the strict, the status of legalization has become a difficult leap. In June, My network, which financed more than 30 million dollars, was suddenly closed for 38 days.

In any case, for Che Hui, the likelihood of creating a Baidu in the next few years seems to be getting smaller. In the May 2008, after several lobbying by the Thunder co-founder Shenglong, Duan eventually became the head of its Beijing Technology Center – in the eyes of some shrewd venture capitalists, the Thunder, 51.com and Net network were the only three possible heavyweights of the online start-up since 2005.

This judgment may not be agreed by everyone. If the first wave of internet entrepreneurship, the birth of Tencent and Baidu two market capitalisation of more than tens of billions of dollars of companies, Alibaba, Sohu, NetEase, Ctrip, Sina, Shanda Six companies with a market capitalisation of more than 1 billion dollars, I am afraid the most optimistic prophet, also dare not declare today, five years will have similar size of eight Chinese web 2.0 companies.

That is the real problem. It has been thought that the Web 2.0 era will create more top companies and more wealth, people seem to have little doubt that the internet industry will be like cars, home appliances and other industries into a century-old industry, which means that after the Web 2.0, there are 3.0, 4.0 ...

But there are two factors that make all sorts of ideas seem naïve.

First, there is still a big difference between China's income model and America's. If every user group in the United States is large enough to be able to feed itself through online advertising, in China, which is far from mature in the online advertising market, the new media form of Web 2.0 is difficult to accept. And the other models: wireless value-added services have been almost controlled by telecom operators, online games is an independent system, not suitable for each company, E-commerce is still not scale.

Second, although entrepreneurs inevitably see themselves as more innovators, established websites that created and laid down barriers in the past 10 years before 2000 have already formed an oligopoly. Unlike America's internet giants, they rarely acquire, preferring to follow up after a successful product model has been created by the latter. The number of flexor, in the domestic has a great influence of the network companies include at least Tencent, Baidu, Alibaba, Sina, Sohu, NetEase and so on.

There were those who thought they could be subversive like Google pried Microsoft. For example, Xingdong has tried to blog China beyond Sina, but when the blog this model has been proved to have the market, Sina, Sohu, Tencent and other intervention, so that blog China inevitably become backward. No one knows whether the same fate will fall on the head of a video site built on huge sums of money but still fragile.

"The last wave of entrepreneurship, where all the open space, you take a piece on it." But now, there are several big cities, we can only do guerrillas, while looking for a few pieces of relatively fertile grass, gradually become small village, and then become a city. While looking for the other meadows. In an interview, Chen, founder of the Oak Group, said to global entrepreneur. His judgment was correct, but even so, Thousand oak still took a lot of detours (please log in www.gemag.com.cn to see the April 2007 "Thousand Oak Illusion"), until this year, Chen finally settled in the campus, and therefore financing 430 million of dollars.

But this may also be the last window of opportunity. "The school and 51 are in the case of Tencent has not paid enough attention to the situation, but from this year, Tencent will certainly adjust the strategy here," said Qi Tiger founder Zhou to this newspaper.

July 24, 2008, when global entrepreneur interviewed Ma, asked the founder of Tencent, who steered the 15 billion dollar market capitalisation, what business he would choose to enter into the market if he started his business today. His answer is: "I can only do what I am interested in, a little bit of exploration to do, not to consider the outside world." "The reason is that the network's core products-portals, instant messaging, search engines and e-commerce-have been divided, there are only two: video and SNS, but also has a high threshold." Ma admits: "Now many people still want to build 1 billion dollar company on the network, already more difficult." ”

Perhaps more worrying than a company's gains and losses: is the entrepreneurial age in China's internet industry about to end?

If the oligopoly is set, the new business model is murky, and China's internet users reach the tipping point of 500 million in 3 years, it is hard to imagine that there is more room for business in the future, in accordance with the existing play-the localization of the American model. At least for now, The vast majority of venture capital organizations no longer regard the network start-up companies as their own research focus.

Into the 2008, although there are still start-up companies, such as Baidu's former CTO in the end of 2007 Love network, internet veterans Xie in 2008 to build a network, but obviously, whether from the number of start-up companies, or the enthusiasm of investors to look at, and 2005, 2006, far from.

Over the past one months, global entrepreneur has interviewed Qihoo, 51, catch shrimp, watercress, cool news, Youku, cool 6, many of the domestic entrepreneurial stage of the site, as well as some relevant investors and the industry, trying to in the macro picture, more to restore the details of this noise and turmoil: A scene at the starting point looks promising a bright, But the march of the rough and heavy collective carnival.

Stimulation 2005

To some extent, from the fall of 2005 to the summer of 2008, a wave of entrepreneurial trend from the rise to the cessation of the Chinese Internet is a dynastic.

Although at the end of 2003, Ctrip landed on Nasdaq to reopen the window of opportunity for China's Internet industry to list overseas, then the grand listing proved the great potential of the online gaming market. But until 2005, everything finally changed: the launch of the Baidu Rocket, as well as Alibaba's subsequent 1 billion dollar deal with Yahoo, let the industry completely excited.

Chance. The two forces from the outside world also make China's entrepreneurial impulses seem irresistible. First, after 5 years of low innovation, the United States has finally reopened a new set of directions after Google: The peer-to-peer concept of Skype, the network community starring MySpace and Facebook, the video platform created by YouTube, Craigslist representative of the Local life information sharing platform, "Second Life" presented by the three-dimensional virtual community ... All these concepts seem to have been reopened in China, especially after the successful replication of Baidu and Taobao. From the second half of 2005, billions of of dollars flowed into China.

The impetus is that 2004 years later, the domestic blog form of the main personal media development, so that no matter whether the new concept of overseas, or domestic start-up companies are easier to spread the first time. One detail is that when the country's most famous blogger, Bo, went to the US Google headquarters, and even some of Google's Chinese engineers volunteered to talk to him and invite him to dinner.

Perhaps since the end of the 1990, China's internet industry has never seen so many entrepreneurial possibilities in a short time, except MySpace, YouTube and Facebook were imitated by hundreds of startups, such as LinkedIn, Bloglines, Plaxo, etc. The third-tier star "is also incorporated into the Chinese perspective."

It is not difficult to feel, 2005, 2006, this gets atmosphere is flooded in the Chinese network industry: Almost every listed network company employees, are looking for job-hopping to "next Baidu." And those who have been involved in the growth of some important web sites, and thus the first bucket of gold, believe that they can learn something from past history. This stage, the most famous entrepreneur is Zhou, and Baidu more than 10 technicians in a short period of time to create nearly 10 companies, but also quite representative.

Capital Determinism

One topic that may only appear to be necessary after hindsight is that, unlike American startups, which must first find the right product model, the question that Chinese entrepreneurs need to answer most is financing.

If the 2000, both entrepreneurs and investors in China, regardless of how to start a good company lack of concept, and eventually become an alternative to the fine flow of investment and financing model, even the same as IDG in each segment of the top three companies will inject VC funds. This time, the game becomes completely different.

A fundamental change is that many of the VC funds set up in 2005 and 2006 have raised as much as $ hundreds of millions of trillion, making it impossible to invest too little, preferring to bet on a handful of companies that seem to have the highest chance of success.

To ensure the return on investment, the vast majority of VC choice is not too much: the United States successful model + local relatively mature entrepreneurs, or those who quickly get a certain popularity of the site.

This makes it easy for some young entrepreneurs to be left out of the flow of investment. For example, the 26-Year-old founder of the network of Wang, and 24-year-old "I want to discount net" Hua, their past resume seems unconvincing (how many coincidence, they also appeared in the 2006 "Global Entrepreneur" "40 years old business elite" selection). And the two companies that are developing well will eventually have to choose to sell at tens of millions of yuan--perhaps the few Web 2.0 startups that have been pulled out of the country so far.

In fact, the vast majority of companies that do not have access to finance are the equivalent of an early exit in the ensuing long arms race.

And for those entrepreneurs who are relatively easy to get funds, such as in the industry's reputation of Zhou, Chen a boat, the problem to be faced becomes, how to grasp the degree of financing.

Qihoo in the "WEB 2.0-era search engine" concept, two rounds of financing 35 million dollars, and the oak group by "China's MySpace" concept plus wireless business revenue, financing up to 58 million U.S. dollars. This is a year Sohu, NetEase can not reach the order of magnitude.

While this increases competition barriers to some extent, it is also easy to create an illusion: The company can do a lot of things. Almost every company, including Qihoo and Oak, has quickly launched a sizeable business exploration, with more than tens of thousands of dollars in financing. It is said that at the end of 2006, Qihoo's second round of financing, many of its mid-level even hope that the financing failed, so that the company will be in a few businesses to choose the most opportunity to burn their bridges. In hindsight, this concern was justified: Qihoo has at least the odd tiger nets, cool nets, 360 security guards, love cool nets, Chinese suppliers five business, of which 360 security guards this year's revenue will be more than 100 million yuan, and can profit-but it must bear the losses of another four companies.

"Too early to finance too much, like the Qing Dynasty to the late, the emperor is sterile and premature, is because of the temptation of a young maid, the body ruined," said one industry personage commented.

Simple, but still few entrepreneurs can resist the lure of money, Douban founder Yang Bo may be one of the few. This stems largely from his earlier unpleasant memories. In the 2000, Yang Bo joined a friend to create a logistics company. At that time, they completed the financing before the company was established. "So much money can make you go a long way on the wrong road, and if you don't have enough money, you'll be careful every step," Yang Bo said. Therefore, the expansion of watercress is very cautious, its establishment in March 2005, by 2006, Watercress still only 4 full-time employees, financing scale of only 2 million U.S. dollars. So Yang joked: "If the Watercress team development has a problem, may be a bit too slow, it may be because I was too cautious."

Reading the wrong trend?

Zhou has told The economist more than once that the cover article "You Media" in the January 2007 issue of "global entrepreneur" gave him the wrong guidance. The story of personal media as a new way of building information and interpersonal relationships has been the subject of repeated discussions within Qihoo, who want to build new search engines under this new trend.

But with a lot of money and a lot of time, weeks are almost helpless to find: In the Chinese market, users create content is much worse than expected, "mostly trivial, for strangers is ineffective." ”

Probably after groping 1.5, the Qihoo team got a simple conclusion: the greatest value of the community is the interaction between people, but the link is not the search engine to pull out.

This is indeed the biggest pitfall of the Web 2.0 entrepreneurial trend: This highly targeted industry trend in China, where most individual users are less active, has a much lower ceiling than expected.

The shrimp net, created by former IBM China Software Development Center architect Xu Yijong and former Baidu senior technology manager Zhang in 2006, may be a representative of this entrepreneurial trend: it has built up a sizeable number of users in the country in a very short time and has completed financing. For most entrepreneurs, this is a decent starting point.

The product model of shrimp capture is the use of subscriptions to integrate fragmented information on the Internet. For example, users will be their daily attention to news sites, blogs and video channels unified collection to a platform, every time there is an update, automatically presented to save the trouble of browsing the site. The same product, an American company named Bloglines.com, was sold in 2005.

Like other startups, the expansion became the next step in catching shrimp, and in more than half a year, the small team expanded to more than 20 people. For a while, catching shrimp basically has a new function on the line every week, such as personal page improvement or looking for friends, or new cooperation launched. In the user, such rapid motion for them won a drink.

But in the second half of 2007 years, founder Xu Yijong and Zhang began to feel uneasy. They found that while the new features were growing and there was a growing appreciation, there were not many users who actually used these features from the data. The number of people catching shrimp has not increased significantly. On the contrary, for some users, the simple tool of the sudden increase of other features, but let them confused.

When the road began to blur again, Xu Yijong felt that the questions that people kept asking him suddenly became real and palpable: what was the core value of the site for users? What is the business value you can get?

Entrepreneurs ' advice always reminds you to think about user value and business value from the initial stage, but most entrepreneurs ' mindset is like Xu Yijong: The first stage is to focus on which direction to make a good product, when the product launches, has a good reaction, Think the most or how to do better, how to iron the iron with more users, how to build a good team and so on, like March general, although also has been thinking about business value, but not to stop to make it clear. "At that stage of recognition, there are many things you can do to radiate from the core value, and many resources are available, and desires are starting to swell," Xu Yijong said.

He decided to lead the team to stop and think. The 20-person team began to meet in the light of the day to discuss, street research, meeting until 12 o'clock in the evening is not unusual, hoping to put the blurred road and see clearly, but did not get too good results.

At the critical moment, Xu Yijong and Zhang decisively decided to contract the team. Xu said that this is not a question of the capital level, abandoning the original team is also a difficult decision, but "suddenly see not clear, certainly need to adjust." In November 2007, shrimp catches only a small team of 7 people, responsible for the daily maintenance of shrimp. During that time, Xu Yijong and Zhang were mostly not in the office, but every day outside to meet advertisers, entrepreneurs, entrepreneurs and other people, exploring the possibility of progress. This is also a difficult process for other shrimp-catching people. "It's not hard, it's not tiring, it's what you don't know what to do, it's the hardest thing for a startup," says one team member.

In the end, catching shrimp decides to change the product simpler rather than more complicated, and it will be a business model for advertisers to integrate disparate sites similar to the user base.

It is said that after 2008 years of catching shrimp in the New Year's Feast, drunk, Zhang to Xu Yijong said: "This year is too difficult, too difficult, but we came." The two were almost weeping and hugging.

Profit off

Catching shrimp is far from the end of the groping. At the beginning of 2008, when it placed several AdSense ads from Google on the page, it quickly drew the user's sharp accusation that the company could not survive? The content of the website originates from the user creates, the income that the website obtains should share with the user? Even if you are basing your advertisers on the target, The number of valuable small web sites on the Internet is also a challenge.

How to make money will be one of the longest and most challenging problems in the Web 2.0 era. Even Facebook and YouTube have not yet been able to make a profit, nor have they found an effective profit model like Google, Amazon and ebay.

After acquiring soft silver for more than $400 million trillion in financing, a noteworthy move by the Oak group is to interact with the 10 million dollar purchase of casual web game developer peas. And before and after this, another large-scale SNS Web site 51.com to 51 million U.S. dollars to the online gaming industry listed companies giants interactive 25% shares. The almost inevitable step is that 51 will delve into the business of online gaming, Shengdong, founder of the global entrepreneur, said: "In the next two years, game revenue growth will bring a big boost to 51 of revenue", Pang also admits: "Each stage has a focus on each stage, now cash flow is more important for us."

It seems that, for a while, the network industry is the easiest to exploit a gold mine, the 2008 market size can reach 13 billion yuan online games market.

Are there any other options?

Earlier this year, China's internet industry veteran Xie comeback, in charge of SNS Web site, he believes, "China's internet is still in the embryonic period." And the Xie business model, is still based on personal behavior patterns of advertising accurate delivery. But even Facebook, which is probably the most likely to make it, has struggled to dig Google's employees because of the lack of relevant accumulation.

It does take a long groping. For the Chinese advertising market, even the relatively direct advertising model of online video can not be accepted effectively, not to mention the need for more space to imagine personal ads.

"The Internet three years will have a King Hing, but that is the ' exception ' of the company, rather than ' Incoterms ' company," Google China is a plan to start a high-level said.

"There's got to be a new small company to subvert the industry, and we can't see who it is now," he said. "It requires innovation, focus, perseverance and good luck," Zhou said. ”

Focus E World Finishing!

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