This is the best team: from Ctrip to Home Inns, Hanting I

Chapter 9 Venture Financing (4)
Chen Tianqiao once said: "Opportunities are like a revolving door that revolves quickly. When the opening is in front of you, you must get in without hesitation." He means that once you find an opportunity, you should seize it quickly.

Jiang Nanchun also said: "At that time, I was not the only one who thought that it was a good initiative to install an LCD display at the elevator door to display advertisements. However, I was the first person to turn the idea into practical action."

What Jiang Nanchun means is to seize the opportunity that others have seen clearly and haven't acted yet.

In order to illustrate the importance of seizing opportunities that others see clearly and have not yet acted, let's look at the story of "Catch the Ox's Tail" again:

There was a young man who was hopelessly in love with the beautiful daughter of a farmer, and one day he decided to come and propose.

The farmer said to the young man who came to propose marriage: "There are so many excellent boys pursuing my daughter. If you want me to marry my precious daughter to you, you must do one thing now. I want to see if you have extraordinary courage and enough wisdom."

The young man hurriedly asked, "Uncle, what do you want me to do?"

"Come here," the farmer said, leading the young man to a cow pen, "wait a while, I will release three fierce bulls one by one from inside, and as long as you catch any of the bulls by the tail, you are done. "

The young man hesitated, but agreed.He is both afraid of the ferocious bull and hopes that a miracle will happen.

The first bull came out, a very ferocious young bull, roaring and charging out at incredible speed.The young man is still hesitating, but it has rushed over.The young man thought to himself, wait for the next one, if he is lucky, it may not be so fierce.

The second bull was released. What the young man saw was a very tall and strong bull. The moment it rushed out of the fence, it showed tremendous strength and anger. The young man trembled in his heart, and he didn't even have the courage to go up up.He thought, I won't be so unlucky, just wait for the next one, no matter what happens to the next one, I must rush up and grab the ox's tail.

When the third bull was released, what the young man saw was a thin old bull who could hardly run.Ha ha!Finally the wait came.He was so happy that he rushed up and grabbed the cow's butt.Suddenly, he was stunned. It turned out that the bull had no tail.

In fact, in the market, many opportunities have never been like this.

When the opportunity is not obvious, you hold a wait-and-see attitude; when the opportunity is obvious, you find that the market competition is already very fierce; when you make up your mind to rush into this market, this opportunity has become a fake opportunity.

During the period from 1999 to 2000, portal websites were very popular, and the Ctrip team had a soft spot for travel websites. Did they really have insight into the market?

In fact, they crossed the river by feeling the stones at that time, and they didn't know what to do.Liang Jianzhang just knows that the United States already has such a website, and it is doing very well.However, if this model is transplanted to China, can it survive?neither knows.

What Ctrip did right is to seize this opportunity first.

3. How to talk to venture capitalists about the three elements of financing and starting a business: people, money and projects.If there is a team and a project, the next step is financing.There are four conventional financing channels: shareholders, banks, venture capital and listing.The start-up capital is basically paid by the shareholders themselves. In the future, it will be either bank loans or venture capital investment. Listing is the financing method for the company after it is on the right track.

Among these four financing methods, shareholders may not have a lot of self-raised funds, bank loans still need to be pledged, and listing is still far away.Therefore, venture capital financing is the best choice for small and medium-sized enterprises.

Many people believe that in order to win the favor of VCs, you must learn to write an attractive business plan.How to write a good business plan?There are four requirements: clarity, brevity, logic, and figures.Only by meeting such requirements can it be possible to convince venture capital.An entrepreneur once said: Getting investment from venture capital is like pursuing a divorced woman, it is too difficult.

However, for venture capital, do they think so?Looking at the investment objects of many VCs, it turns out that the most important thing for VCs is the entrepreneurial team, followed by the project.In the column "Win in China", Guo Fansheng once said to an entrepreneurial team: What you lack is not money, but the trust of rich people in you.

Therefore, they believe that the most dangerous thing is people, not projects.They pay great attention to communicating with the entrepreneurial team and understanding the ideas of the entrepreneurial team members.

What questions do venture capitalists ask entrepreneurs?

1. Regular mode.Venture capitalists generally ask entrepreneurs three questions:
(1) What are you doing?

When answering this question, follow the KISS principle (Keep It Simple & Stupid), which means the simpler the better.Because venture capital usually thinks that the simpler the model, the easier it is to succeed.

(2) Who is the entrepreneurial team?How did you meet?
In this question, what the entrepreneur needs to answer is the number of the core team, and tell him how you met.It's better to introduce yourself than to ask the CEO to introduce you one by one.

(3) What is the current cash situation of the company?
The real purpose of VCs asking this question is reflected in the following three points:
First, the VC wants to know the general situation of the operation and how much cash is left?How long can it last?If you tell a VC that you can only support it for 10 days, then don't talk to the VC.

The second is the control of cash.If you can’t answer this question, the venture capital will find it incredible. You are the CEO of the company, and you don’t even know how much money the company has?
Third, the control of cash flow.You have to have a need for cash, and you cannot say that you are not short of money at all, and that is not realistic.It can be said that the company's existing business can keep the cash in a healthy state.If there is no expansion, this money can be maintained until next year.

2. Special mode.Questions that do not follow common sense:
IDG asked Ctrip several questions:

(1) What is the purpose of founding Ctrip?
(2) In another 10 years, if Ctrip becomes big, what are these people in the entrepreneurial team going to do?
The purpose of asking the first question is to understand why the team wants to start a business; the purpose of asking the second question is to understand the thoughts of the core members of the team and how big a business they are going to do.

Softbank asked Ctrip a few questions:

(1) Where are you from?
(2) What do you like to do?
(3) What hobbies do you have?
These few questions are simple, but very useful.During the interview, if you want to get comprehensive information, it is best to ask open-ended questions, so I won’t go into details here.

In short, the reason why venture capital examines entrepreneurial teams so strictly is because they do not directly participate in the company's operations and cannot control the companies they invest in.The only way to achieve great things is to choose the right person.

In the two years from 1999 to early 2000, countless funds poured into this industry, countless Internet companies were born overnight, and many Internet companies died overnight.

However, in this case, the Ctrip team did not disappoint the venture capitalists, and their performance in this "Internet bubble" was very good.Next, let us take a look at Chapter 3 "Transformation Acquisition".

2009. Can you enter the cactus beverage market On the afternoon of January 1, 19, Zhang Chao, a former colleague, flew from Hainan to Shenzhen and asked me to discuss something.

At 8 o'clock in the evening, we met in Huaqiang Beishangdao Café.

"Zhang Chao, we haven't seen each other for 6 years. You should be doing well now, right?" I said directly.

"Hey! Old leader, to be honest, I'm doing so well. I'm currently opening a beverage factory in Hainan with a few friends, specializing in the production of bottled cactus beverages."

"Cactus drink? This is a new product!" I was a little surprised.

"Yes, I want to take a path that others dare not take. As you know, there are Robust and Nongfu Spring in the mineral water market; Uni-President and Master Kong in the tea beverage market; Coca-Cola and Pepsi in the carbonated water beverage market; Wanglaoji in the herbal tea beverage market , Guangdong herbal tea; functional drinks include Red Bull, Li Health Care...the cactus drink market has no well-known brands yet.”

"The idea is very good, but I really want to know where your product is positioned? That is, what is the appeal of this product for customers?"

"The product is very good. It has a unique taste and a delicate fragrance. It has health care functions such as beautifying, invigorating the stomach, clearing inflammation, lowering blood sugar and blood fat. If the promotion is in place, this product will definitely have a broad market prospect."

"That's right! What I'm talking about is also the question of marketing: why do consumers drink this bottle of beverage? You should know that this is a brand-new product. Although there are similar products on the market, there is no company yet. Really build this market." I said solemnly.

"So, I came to you! If you want, please join our team, and you will be the marketing director."

"Are you willing to spend money on advertising?"

"Our boss is worth more than [-] million yuan, and he is also very confident in this product. He is a native of Hainan and has contracted thousands of acres of land to grow cactus in Hainan."

…Based on the conversation above, do you think there is any prospect for this market?If so, how should we shape the selling point of this product?

(Refer to page 217 for the answer) 1. Invest 20 million yuan, how many shares should it take? A friend from Chaozhou, after 8 years of hard work in Shenzhen, finally opened 500 hotels.The current situation is that the investment of each hotel is about 7 million, and 30 hotels have already made a profit, with a monthly income of 5 million yuan. The other hotel has been in a loss state since it opened for a year, and it is about [-] yuan a month. ten thousand yuan.

After seeing the rapid development of the chain hotel industry in recent years, this friend began to have an idea.He asked a management consulting company to give him a unified name, and spent 15 yuan to get a VI manual.

Not long after, a venture capitalist took a fancy to it and said that he was willing to invest 1 million yuan, accounting for 70% of the shares.

Q: Is this share ratio reasonable?If not, how much do you think it should be?
(See page 218 for the reference answer) Transformation and Purchase, a company established only half a year ago and never engaged in hotel reservations, has found the most profitable model in this emerging industry and achieved a perfect transformation.And when the company was in a loss-making state, it used a small amount of cash and stocks to successively acquire Shangzhihang and Modern Express, which were profitable at the time. "For the current situation of Ctrip, it is the best choice to acquire the best room reservation agency in the market."

Quotations Shopping Mall Comprehension 1-5: First of all, you must do it. If someone praises you for doing it, the person who praises you must also do it. You must also practice it.
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Reading Ctrip's entrepreneurial team members recognize each other and feel that they are not afraid of opponents like wolves, but teammates like pigs.
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Be cautious when choosing a team partner. What you lack is not money, but the trust of rich people.
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Reading the second financing of the Ctrip team, I feel that hard work may not be successful, and no hard work will definitely fail; you can choose to give up, but you cannot give up the choice.
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Reading Ji Qi's talk about mergers and acquisitions Whether you are a lion or a sheep, you must run; whether you are poor or rich, you must work hard.
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Reading Wang Shengli's Entrepreneurship Story
Fable escape of bees and flies This is a very inspiring experiment, the designer of the experiment is the famous Karl?

Professor Wake.

One day, Professor Wake came to a very dark big room.He first opened the only small window inside, then put 6 bees and 6 flies into a glass bottle with a narrow mouth, and then put the bottle flat with the bottom of the bottle facing the window to see how they broke through. Bottleneck, how to escape from a narrow-necked glass bottle.

Judging by conventional thinking, it should be the bees that came out first.However, the result was surprising.

I saw the bees kept slamming on the bottom of the bottle, trying to find a way out from there, until they were exhausted and collapsed or starved to death before finally giving up; but the fly was different, it flew around in the bottle, and in less than 2 Within minutes, he passed through the bottleneck at the other end and ran away.

Professor Wake couldn't believe the facts in front of him, so he decided to do several more experiments and observe carefully each time.

After many experiments, Wake finally figured it out:

Bees are very fond of light. According to their experience, the outlet of the glass bottle should be in the brightest place.Although glass is a supernatural mystery, in nature, they have never encountered such a sudden impenetrable atmosphere.They feel that it is unacceptable and incomprehensible not to pass through this strange barrier.So, they keep repeating this logical action.It is because of this unshakable belief that the bees are going extinct.

And those flies don't seem to care much about the logic of things.Ignoring the existence of the light, they fly around, but they hit the right one. After many attempts, they finally find the right exit, and they gain freedom and new life in the place where the experiencer died.

The story of bee and fly escape tells us:
1. Past experience may be a stepping stone or a stumbling block to the current new job.

2. In the face of unpredictable situations, we must learn to persevere, know how to advance in a roundabout way, not be afraid of trial and error, and dare to take risks.

3. Constantly trying is more important than experience and intelligence.

(End of this chapter)