Zou Shenglong: the future of Thunder is a cloud service company

On the afternoon of July 24, Zou Shenglong, a Thunder CEO who just returned from the United States, accepted an interview with Economic Observer. Three years ago, Thunder's valuation was lowered from 1.7 billion to 700 million, so Zou Shenglong canceled the IPO.

In the first half of 2014, Thunder suffered more severe tests. Thunder there is always a business "spell" Thunder paid members to buy value-added services, but Thunder's value-added services is relatively simple. Perhaps, from the moment of listing, Thunder will make adjustments and restructuring.

In response, Zou Shenglong gives the answer is: the future of Thunder will not be a download value-added service software, but a cloud service company.

Economic Observer: Thunder three years ago, when the market is about 1.7 billion valuation, while the market capitalization of only 10-11 million, how to treat the market so huge shrink?

Zou Shenglong: This figure is what I said. Thunder three years ago to communicate with the capital market is selling things, this time is the seller's market, the market is very good. I asked, how much will you buy this thing? (Investor) say 1.7 billion I will buy, I heard very happy. I ran the 1.7 billion target and then find the next one, that I want to sell 1.7 billion, can give 2 billion, is such a logic. Finally arrived (this year) came again this time, saying that now the market can only give you 800 million, you quit. The price fluctuations in this process sometimes have less to do with your company's own operating performance. Completely the market is willing to use your magnifying glass to magnify your performance. Three years ago is the seller's market, and now the buyer's market, the price strategy is not the same, can not be considered a simple shrink.

Economic Observer: Valuation has nothing to do with performance?

Zou Shenglong: I think the IPO company valuation and performance have a certain relationship, but not all, as well as the environment factors.

Economic Observer: Thunder three years during the business a lot of changes, and now Thunder business model, foreign investors can understand?

Zou Shenglong: 2011 and 2013, we have different positioning of investors. In 2011, we were considered an online video company by the capital market, and in 2013 we were just an online video business. Now the positioning is very clear, emphasize with investors that Thunder is a user-participating cloud computing company, to provide users with cloud computing services - such as acceleration and future storage.

However, in 2011, the early communication with investors to communicate inadequate, upper communication strategy is not so clear. In 2013, we adjusted our strategy, including what to talk to investors, who to talk to, and who to talk to.

Economic Observer: Who do you talk to?

Zou Shenglong: first talk with investors in Asia, Asian investors in particular know what is going on you, strengths and challenges he knows. When you convince them, it's easier to convince some farther investors. In 2013 China saw a number of exceptionally outstanding local funds. These funds have made money in the previous round of Internet climax. They have a good understanding of China's Internet and believe that the Internet in China has not reached a peak. We all think the climax is yet to come. They are very confident of the Internet in China. When we went to find investors, it was usually the first stop in Singapore. Now, our first stop is Beijing, the second stop is Shanghai, then Singapore.

Economic Observer: May when the capital markets have fluctuations, the overall environment is not good, Tencent has been falling, what impact on the Thunder?

Zou Shenglong: I bought Tencent at that time, because I know it will be back up.

The scene was Thunder over-subscribed more than tenfold, is the tenth IPO this year, Chinese companies, after three were issued according to the upper limit of the pricing range. Generally, we think pricing above the pricing interval means that the company is very successful in the roadshow process. Thunder pricing interval is 9-11 dollars, the last increase of one dollar, up 20%, which is very large adjustment. The other two listed companies their pricing range is around 20 dollars, a tune is 5 cents, this ratio is not large. But the truth is the same, you dare to price above the pricing range, because you have a very real oversubscribed.

I used to think that going public was a matter of weathering and luck was very important. But now I think it depends on ability, the development of capital market is very important.

Economic Observer: So you think the concept of listing in 2011 right?

Zou Shenglong: Any one of the window can be successfully listed companies, I think all worthy of respect. The real master is in any environment, can make this thing. In 2011, I did not have much experience in the capital market, so I think it was a matter of eating by nature and it should be possible to catch up with a good window. In fact, the time window in 2011 is not bad. Because you think he is a dependent on the weather to eat. So when the market is not good, you will be very difficult to deal with the risks brought by the market is not good.

Economic Observer: So canceled the listing. Did the disagreement between you and the underwriters make this fall in May? How many people ask for a delay? How many people agree to continue?

Zou Shenglong: people around that time will come to discuss with you, we should not postpone, wait for the market is good and then come back here. At this time you need to make judgments, postponed it must be okay? No one knows, but I'm aware of the negative things that have been postponed. It costs a lot to pay, it's very difficult, it takes courage, and you have nothing in advance to know what's right.

Economic Observer: their attitudes have to postpone it?

Zou Shenglong: There is no delay, we should discuss how to deal with this matter. Every IPO goes through this moment. No IPO is a smooth one. This is not a big deal, but it requires you to seek a point. This is not a person to play, a group of people to play. Everyone has their own place, when you want to attack, to convince everyone to cooperate with you.

Economic Observer: How to convince them? You decide to continue?

Zou Shenglong: I did a very in-depth analysis, the final decision is to continue. This persuasion process is not to give you a call that we let go, move forward. Really need a lot of patience, a lot of skills, because no one in this one we will hear a word, we want to form a consensus, it is the need for a lot of strategy. I may not tell you what to do, let me tell you what my attitude is. I will give you an analysis of how I should go. If I go along two roads, how can I explain the risks of the two roads? We do not have to go forward, go a small step forward, step by step. You can not pull everyone up to a decision, everyone will be unhappy, things are not doing well.

Economic Observer: What is the most difficult choice?

Zou Shenglong: The most difficult choice is not one, are quite hard. For example, pricing, the left is your old investor, the right is your new investor. The price is high New investors are hard to come in, the price is set low The old investors do not think it profitable.

Economic Observer: How do you communicate with the idea of ​​millet?

Zou Shenglong: I know many years with the Lei Jun, early 2000, when to know. We actually have a consensus that the data experience is a very important user experience. In the Internet can be a large-scale use of shared economic model to achieve this company, both behind the technical platform or the previous product platform, Thunder is the largest. But into the details you will want to understand that the end and the cloud is the strongest. For Thunder, Thunder hopes to serve more end as soon as possible.

Economic Observer: Thunder appeared problems before the market, slow, a lot of content is deleted, the paid members have a certain impact. Is it because of this problem to consider restructuring? After the business model turned to the technical services of the enterprise?

Zou Shenglong: This investor also asked me, I am sure to give him a very satisfactory answer, can not tell you here. Thunder cooperation with millet, Thunder's starting point to be able to reduce the time Thunder contact with users.

Economic Observer: Is it right? You are responsible for all terminals to provide accelerated service millet, millet from charges, give you to pay service fees?

Zou Shenglong: I do not answer your question. Thunder must be able to come out through the millet platform.

Economic Observer: Thunder to see consumption of broadband, copyright is expensive, but not exclusive, it is a drag on earnings. The task of these two years probably completed only 20% to 30%, Thunder will not give up this business?

Zou Shenglong: Video This market is not a thunder to see a no profit, is the entire market all Internet video companies are not profitable. Why are you still doing? Because video is a basic user application. For a business, some business is to develop, and some business is to raise.

Economic Observer: Have you painted pie to investors?

Zou Shenglong: No, before the Chinese Internet than the United States behind, especially in the model. But I believe in the future there will be more and more U.S. Internet companies starting to learn and learn from Internet companies in China, such as the future business of Thunder.