Zhu Xiaohu about trickle merge process

February 14 this year, a drop of taxi and fast taxi announced the merger. "Starting in Qingping, counterattack shaken, Shanghai and Guangzhou sweeping the Yellow, financing block, rifle fire, red envelopes, Liu Qing joined hands and peace; it is hard to imagine that all this is completed within 2 years." Jinsha River venture capital director Zhu Xiaohu manager so summed up the development of this two-year taxi.

Jinsha venture capitalism is a series of investment in a taxi, in the dribbling CEO Cheng Wei has seen 20 VC institutions failed, in December 2012, Zhu Xiaohu met with Wei on Weibo to meet half an hour later A round of financing.

In each VC are not optimistic about the case, Zhu Xiaohu why bet with confidence? In addition to funding, Zhu Xiaohu is the greatest help for what is the drop? Between the two years, tricky and fast multi-round capital game and Pushed through what is unknown to recruit the story? In the end who contributed to the merger of drops and quick? After the merger, the industry will take place what changes. Recently, Zhu Xiaohu told reporters about all this.

The following is an oral record of Zhu Xiaohu:

Drip drops Cheng also thought that when encountering a liar

We are concerned for a long time in the field of travel. As early as 2010, we are very optimistic about the local travel.

At the start, we paid close attention to the first round and then they took the A round of investment and even signed an investment agreement, but after the due diligence, they did not invest.

One reason is that when the driver's smartphone penetration rate is very low, easy to get in order to expand the driver group, want to give the driver a handset, but in doing so, the expansion costs are high, the efficiency is relatively low. The other key issue that worries us about this is that at that point it was not yet a time to feel like getting the taxi software, so there was no investment at the end.

Later, we touched the mobilization team. At that time, shaking the team has a lot of users in Beijing, but came in contact found that the team is too weak, the Internet is not thinking. For example, at the time with shaky car registration must be registered, but also recharge, not at all Internet thinking, so I feel this team will not work in the long run. In the same period, in Hangzhou, Chen Weixing (formerly the fastest taxi CEO) was also incubating a project, which was later a quick taxi.

November 2012, I saw a drop of a taxi, chatting on the weibo about Cheng Wei, met him chatted for half an hour found that Cheng Wei team really think very clearly what to do what should not be done . Team morale, including the past experience of BD and push just match this business, so talk about half an hour basically set down, Cheng Weiti conditions we fully agreed.

Later I learned that before he met me, he had seen at least 20 VCs, but none had invested in him. I decided to vote for him half an hour after he met him. He thought I was a liar.

The day I went to see the completion of Cheng Wei, back to the International Trade, walking on the road, came downstairs to three white-collar workers, one of whom is very excited to his colleagues that I hit the car with drops yesterday. This makes me think, taxi software is just a high-frequency applications, but also has a high degree of virus transmission characteristics, we must vote.

The only thing that forces Cheng Wei to accept Tencent's investment

As a person, in the development of the drop, it has always been standing by to applaud the drop and not participating too much in specific affairs. One of the only things that strongly urge Cheng Wei to do is forcing him to take Tencent's money.

After we invested, I advised Cheng Wei and Wang Gang (drop angel investors) take Tencent money, but they are hesitant.

One reason is that Cheng Wei and Wang Gang are the original Alibaba employees, Tencent's investment will certainly have a psychological barrier. More importantly, at the time of the round B financing, they did not want to accept strategic investment prematurely and stand prematurely. They want to take a strategic investment when markets are more lucrative in round C.

This consideration is generally correct. However, at that time, Tencent WeChat's entrance force has been fully demonstrated, and Ali has already supported a fast taxi in Hangzhou. Tencent also made it very clear that you must invest in the field of travel, most want to invest in drops. If Tencent was forced to support shaken car, which means that drops in the Beijing market to shaken the car, in Shanghai, Hangzhou taxi to play fast, it will be a very tough two-lane operation. Trade-offs, the introduction of strategic investment in Tencent, to stabilize the Beijing market, it has a high degree of strategic value.

On the other hand, Tencent investment is very professional, but also very sincere.

In the spring of 2013, Peng Zhijian, general manager of Tencent's investment department, invited us to dinner at White House in Zhongguancun. Later, chairman of Tencent's board of directors Pony came to Beijing to find Cheng Wei for dinner during the two sessions. At that time, the drops were still small, one or two thousand a day, Pony came to find their own entrepreneurs to eat, showing that Tencent from Pony to the investment department up and down the travel sector is very important strategic importance.

In terms of professionalism, it is fair to negotiate with Tencent's investment department. When I cast, Cheng Weiti almost all of the conditions we agreed, Tencent is the same, we mention the conditions are almost all agreed, very supportive of start-up companies are also very open.

In April 2013, a taxi took the B round of investment by Tencent. As VIE overseas architecture takes time, from the legal point of view, we first day and Didi Dao signed the A round of contract, the next day, Tencent and Drip signed the B round of financing contracts, this time, to the end of April.

Ali personally sniper drop financing

The two sides have already played a very tragic when the two sides have not completed the B round of melting C round.

Arrived dripping melted C rounds, at that time Ali personally came out to stop dripping financing.

At that time, we see every investor, Ali will call the past asked him not to invest drops, and even promised to each other Ali shares listed at such a price not let them invest.

We met a few investors in New York. We met several investors in Silicon Valley. We had already made an appointment and later said we could not see it. Even one has signed an investment agreement, and later said sorry to vote.

By the end of 2013, CITIC Industry Fund led a drop of C round of financing. In the meantime, with the help of Ali, fast also got C round of financing. In February 2014, the two parties started a subsidy war of up to three months.

In July 2014, Liu Qing added after the drop, the drop of financing has become very easy. We also helped a lot during the round B and round C, and even when Cheng was in the United States, I did not need to be involved. Liu Qing is very good and can bring all the investment funds that are interested in this industry all over and get 700 million U.S. dollars in financing in three weeks.

Unexpected Subsidy Wars

We did not think of the beginning of the subsidy war, completely ignoring the gun. Initially, Cheng Wei to find Tencent 8000000 yuan budget promotion WeChat payment, Tencent feel too little, gave 15 million yuan, as a three-week budget, did not expect on the line for a long time gone.

No one thought the subsidy effect is so good, Tencent found that WeChat payment is very helpful. At the beginning of 2014, just after the end of that year, because WeChat red envelopes, WeChat payment has tied a lot of cards. These people do not have WeChat red envelopes after the end of the year, just dripped again WeChat payment active.

Tencent first subsidies for a week, the amount is indeed very fierce. But fast response with Alipay quickly, I feel wrong, they must follow up, they follow up after we can not stop, we must keep up, and then could not stop, hit both ends of the anger are up .

By April 2014, the subsidy was already quite substantial. Taxis were almost free, users were ineffective and had to stop, but the prisoner's dilemma was formed if the other side could not stop.

Cheng Wei and fast taxi CEO Lv Chuanwei are watching each other can not stop, but it is impossible to stop all at once. Therefore, the two sides are looking at each other. The drops drop faster and follow up quickly. Then they drop faster and then follow up. Both sides release their friendship gesture and step by step down the subsidy. At the same time, both sides announced the cessation of the subsidy on May 17 subsidy.

Amalgamate middlemen: Bao Fan and Liu Qing

During the trickle down and fast competition, the merger talked about many times. Many investment institutions, including Goldman Sachs, have expressed their wish to invest after the merger. Many agencies have expressed their willingness to merge more than once.

However, the final can lead to rapid drip and merger, really want to thank Huaxing Capital CEO Bao Fan and Liu Qing. Liu Qing is indeed both sides can speak the truth, this person is indeed very important. Because both parties used to play too fiercely, the trust level is relatively lower, and Liu Qing has a relatively high level of trust in both parties.

In the second half of 2013, Liu Qing, who was still in Goldman Sachs, personally organized a negotiation between the two sides before the fast acquisition of Hornets. At that time we agreed to meet at Hangzhou Airport. Liu Qing flew from Beijing to Hangzhou Airport on the morning of the same day and had lunch with Xie Shih-huang and Lv Chuan-wei from Ali Investment Department. After lunch, Liu Qing flew back after lunch. At that time, the main point of divergence was that both sides had too much difference in the expected value of the share valuation ratio and did not talk about it.

However, after the recent round of financing, there was a quick support for Son Zhengyi. We all understand that one backed by Tencent, one backed by Ali, so will not kill each other killed.

From the capital considerations, if tens of millions of dollars or hundreds of millions of dollars level, Tencent and Ali are indifferent, they all can afford this battle, if you hit billions of dollars, we all feel that it does not make sense to play .

At this time, both teams felt the need to seriously consider the merger, after nearly a month of negotiations, the final realization of the "Valentine's Day plan."

Evaluation: Cheng Wei Liu Qing strong ability to learn very hard to fight

Cheng Wei is really smart, and learning ability is very strong.

Cheng Wei's change is too fast. Drip two years of business development hundreds of times, he can grow with this company, met a lot of storms. This is indeed rare among entrepreneurs. There are many entrepreneurs who are strong, but one or two or three times a year can be regarded as doing well. It is rare for a person to be able to grow hundreds of times in two years.

When he first saw the VC will blush, to see dozens of VC after very experienced, the momentum came out. Liu Qing finally attracted over, which is even beyond the imagination of all of us.

Liu Qing just come in a month or two the pressure is very large, work intensity beyond her imagination. Liu Qing she has three children, but also so hard, even more powerful than at the time of Goldman Sachs.

Cheng Wei and Liu Qing two people with the I think it is still very understanding, and indeed very complementary. Liu Qing in the capital market more highly, Cheng Wei very grounded, two very complementary.

Drips are a lot of money on subsidies, but working conditions have always been tough, they used to be very small and breathed a lot of oxygen, and even travel conditions are tough. Subsidy war, Tencent sent special support technology detachment, the office sat no less than, can only be transferred to Tencent's office, we suddenly found Tencent office package actually eat the package to drink.

When the counterattack shook, shaking the bag under the airport Terminal T3, drops by four or five o'clock in the morning at the train station to the driver one by one to install the app, it can be said to be completely defeated by millet and rifle shake shake.

The two sides merged: three months after the industry there are changes

The combination of dips and quicksia is a big shake-up for the industry as almost all companies in this area are reassessing the current situation and reconsidering their strategic decisions, most likely in another three or four months and a new round Variety. China's Internet has always been the king of traffic. Now it seems clear that a taxi is definitely a traffic entrance for a local mobile trip. Whoever holds this entry can gain a competitive advantage. How to continue the evolution of mobile travel, let us wait and see how to play the next season drama!