Are midstream and upstream technology companies necessarily worth investing in?
Wen 丨 Zhang Nan
Source 丨Tou China Network
I've been following the virtual human track for a while, and last week I found a novelty, someone pushed a knowledge digital person, called "Dr. Yu".
Where's new, you ask? First of all, on the surface, someone pushed a man's IP out surrounded by a number of beautiful female IPs, but the male IP sold not the idol-style "male color", not the main entertainment functions such as singing, dancing, and performance, but the positioning of knowledge bloggers. In other words, the scene of virtual human IP is extending to a deeper level of demand.
But in turn, the investment market has another spectacle.
People know that virtual people are a big track, one of the entrances to the meta-universe, and there are also reports that the market size will reach 270 billion yuan in 2030. But what about investment cases? Mofa Technology is sought after by Sequoia Wuyuan SoftBank, which has raised $130 million in two consecutive rounds, but it is a "virtual person solution service provider". Looking at it in reverse, in the direction of IP incubation, the only thing that makes an impression is that Byte voted Li Weike.
What do you mean? Can't miss, must participate in the entrance of the meta-universe, a few years later, why do VCs only dare to invest in "selling water"? Is it that the capital market has no confidence in this track at all?
Let's throw a conclusion for the bricks:
To truly eat the virtual human dividend, IP investment is still the only way to go, and some potential facts are happening:
Virtual human IP is rapidly penetrating into more scenarios;
Virtual people endorsement, goods, product peripherals and other monetization paths are emerging;
The personification of virtual people is a constraint on business efficiency in the short term, but not necessarily in the long run;
Virtual human IP is changing from "accounts payable" to "asset".
Let's start with the question of "human nature" that seems the deepest.
Is human nature the enemy of business efficiency?
Recently, it has been brushed by the MBTI personality test, and it is said that young people have now put their personality types on the social media signature bar, which has the meaning of "seeking recognition and looking for the same kind".
I understand this feeling too much, after all, when I was a teenager, my QQ signature was once unable to look directly at the painting style, and now that I know THE MBTI, I immediately spent 30 minutes to do the test, and the result was INTP, I am very satisfied.
In the final analysis, the reason why we seek comfort in the network, but in reality we increasingly feel lonely and even socially afraid, is because we are caught in the strange circle of "familiar people do not understand, and people of the same frequency cannot find it".
So imagine if there is a person, TA knows all your preferences, understands your physiological state, speaks in line with your language habits, looks also in line with your aesthetics, and can even be said to be born for you, every day on the Internet can find TA at any time, and even in the future there will be opportunities to get along with you in the real world, would you like to? Further, if he is a digital person, can you accept it?
This day may soon come, from the appearance of features, voice, action and other external modules, many virtual digital people on the market have been difficult to distinguish between true and false. That is to say, removing the cost factor, the current modeling, driving, rendering of the three underlying architectures, has been enough to support the actual application of virtual digital people in a considerable number of scenarios. So, if you combine recommendation algorithms, big data and virtual digital people, can you help you find such a "TA"?
This doesn't sound like a technology issue, but more of an ethical issue. It is no wonder that the evolution of technology is essentially derived from the evolution of ideas, the breaking and reconstruction of old systems and old ideas, which is the same as Turing inventing computers to decipher the Nazi German code, Einstein broke the gravitational force by relativity, and even Jobs single-handedly drove society into the era of mobile Internet, it is difficult to use pure technology or science to explain why these evolutions occurred.
The reason why I propose this TA, I mainly want to express two meanings:
First, if we enter the metaverse era, whether it is a virtual digital person entering reality or a virtualized human being, similar ethical problems will be encountered in the future, and early speculation will help emancipate the mind;
Second, many analyst institutions have carried out development planning and data prediction for virtual digital people, although this is an indispensable criterion for investment, but specific to the industry and scenario, or do not set a pre-limit as well, after all, ten years ago, it is estimated that no one can imagine that life will be like this.
Back to reality, we can see that virtual digital people are "invading" the online world on a large scale and in batches, and have a considerable degree of application in many specific scenarios, but if anyone proposes to let them do an MBTI personality test, it is a bit ridiculous, because they do not have real humanity, let alone any personality, even if there is a director, editor, planner, copywriter, collective, not individual.
For example, Liu Yexi, since the official launch of Douyin in December 2021, has received tens of millions of likes, which can be described as a huge popularity, in its 5 episodes of "Ground Branch Maze" short drama, although wrapped in such a human exploration as the tram problem, it is difficult for you to see substantive views in just a few minutes, and ultimately it is to serve its purpose, that is, how to make the audience more likely to accept such a virtual character who fell out of thin air.
Therefore, business is usually anti-human in the name of human nature, anti-human nature is not a derogatory statement, and human nature is not necessarily a positive word. The so-called humane things we understand, such as dirty restaurant snacks in the streets and alleys, will be replaced by chain restaurants sooner or later; if the fireworks market does not have relevant policies, it may not be able to compete with community group buying, not to mention the newsstand, which is already a product of ancient times.
Thus, human nature is only the enemy of commercial efficiency.
But are they temporary enemies, or long-term enemies?
The logic of changing from "accounts payable" to "assets"
Qubit in the "2021 Virtual Digital Person Deep Industry Report" believes that by 2030, the overall market size of virtual digital people in the mainland will reach 270 billion yuan. The core competitiveness of the upstream lies in making the underlying technology of the virtual digital person, from the modeling accuracy, appearance details, morphological actions, etc., the fineness is naturally proportional to the cost, and the content quality of Liu Yexi's short drama, the production cost of a single episode is as high as "million yuan".
Source: Qubit "2021 Virtual Digital Man Deep Industry Report"
Wang Boxuan, CEO of Quantum Craftsman Star, told me that the current virtual digital human industry chain is very fragmented, and due to the long production cycle and high cost, the production capacity is also relatively tight.
Taking dr. Yu (Dr. Yu), the first knowledge-based digital person newly launched by Quantum Artisan Star, it is reported that its production team is a film and television production team, including animation and special effects teams that have worked for companies such as Singapore LucasFilm and Shanghai Oriental DreamWorks, and have also participated in the development of "Star Wars" animation, "prime rose" animated movies, "Kung Fu Panda 3" and other characters, so they can better achieve hyper-realistic style.
Quantum Craftsman Star's hyper-realistic knowledge digital human "Dr.Yu".
Therefore, not only virtual digital people, but also many other industries such as film special effects, game CG animation, etc., are the target customers of these upstream companies, such as Digital Kingdom, which is the largest film and television special effects company in North America, with a branch in Beijing.
The company injects the "soul" into the virtual digital person, the core of which is intelligence, interaction, motion capture, etc., of course, it has also spawned different technical routes, such as due to the improvement of expression and posture recognition accuracy and the progress of algorithms, the cost reduction, most of the virtual digital people on the market at present, are using real-life motion capture technology, and there is still a certain distance from breaking through the technical critical point through AI simulation. Baidu, Microsoft Xiaoice, iFLYTEK and other established enterprises are mainly used in the field of interactive intelligence, with multi-industry versatility.
In any case, start-ups such as modeling, rendering, motion capture and other mid- and upstream "water sales" are naturally the objects of pursuit by venture capital in the flow of technology. On April 6, Mofa Technology, a virtual human solution service provider, announced the completion of two consecutive B/C rounds of financing, with a total amount of 130 million US dollars. Among them, the B round of financing was jointly invested by Fresh Capital and Jinsha Capital, Sequoia China and Wuyuan Capital invested three consecutive rounds of additional investment; the C round of financing of US$110 million was jointly led by SoftBank Vision Fund Phase 2 and a well-known strategic investment institution, followed by Northern Light Venture Capital and Index Venture Capital.
In contrast, THE IP incubation operation is simply a loss of the face of the virtual digital person, obviously no matter which platform you go to, you are exposed to these virtual digital people who have been incubated, but you can't even call him a track.
Just in the case that virtual digital people are already so hot, public channels are also rare to see such IP incubation, the corresponding financing news of operating enterprises, I remember the last time I was out of the circle, or at the beginning of this year, ByteDance investment "Li Weike".
Essence Securities' point of view is very interesting:
1. The business logic of the last round of IP incubation is like "accounts payable", and this round has become "assets";
2. IP has moved from the "media logic" of "high above" to the "social logic" of "equal rights";
3. IP polarization will be more prominent: IP with a huge world view in the world, and IP with influence and recognition in the field of segmentation;
4, the influence of IP must be presented more representational, concrete, such as video, AR/VR.
The first point of view actually explains the problem: why is this round of virtual digital investment hot, but there is no IP incubation?
First of all, the previous round of IP investment fever, remove the factors of chasing the wind, the basic investment logic is that the operating company takes other people's IP to make money, belongs to the debt, improves the leverage ratio, is a typical light asset operating model; this round, into an asset, naturally it will become "heavy", from the production of virtual digital people to the operation, where to spend real money and silver, not necessarily precipitated, is a typical "bad track".
Here we will not talk about whether the virtual person IP incubation has investment value in the end, the so-called middle and upper reaches of the technology company, must be worth investing?
Not always, in "Just started the year, this track financing has been nearly a hundred, VC investment of more than 250 billion", Shengjing Jiacheng investor Liu Di said, "either the team that failed to do the game, or the team that failed to do film and television, saw the track hot, rushed in, but most of them did not do it seriously." The reason is very simple, the track is hot, there is a lot of money, even if there is no strong technology, the first entry place has the possibility of success. ”
Today's capital Xu Xin also made it clear that "I have seen too many excellent talents struggling in mediocre business, and a good track is more important than a good founder." ”
Combined with the third point of view of Essence Securities, I believe that compared with upstream and midstream technology companies, there are still opportunities for IP incubation of digital virtual people.
Wang Boxuan revealed that on the day Dr. Yuyu was launched, Quantum Artisan Star finalized the first investment institution of the angel round. A new round of entry capital, voting on the digital virtual person track IP is also unfolding.
New perspectives and perspectives
At present, most of the digital virtual person IP incubation and operation companies are transformed from the previous real-life MCN company, or at least have relevant experience, the so-called "ip with a huge world view in the world, the IP with influence recognition in the subdivision field", Liu Yexi obviously wants to do the former, you can taste the difference between movie stars and Internet celebrities, in the Little Red Book, AYAYI, is the idea of idol cultivation; the latter is KOLs in different fields, and each subdivision has hidden opportunities.
Moreover, virtual people can quickly become popular in the MCN industry, and there is the following industry consensus: there is no moral hazard, there will be no "collapse"; there is no contract risk, and the fire cannot run; the third can be unlimited authorization, not limited by time, venue, etc.; most importantly, the virtual person does not have no business share (except for IP authorization).
Wang Boxuan believes that the removal of service-oriented virtual digital people in specific scenarios such as bank customer service, TV hosts, and sign language anchors, according to the logic of the current short video MCN, is divided into two large tracks: plot and oral broadcasting, oral broadcasting has no plot interpretation, no scene changes, so the first scene covered by virtual people is fashion beauty and knowledge.
Wang Boxuan said frankly that the launch of Dr.Yu (Dr. Yu) naturally has the factor of digital virtual fire, but the core competitiveness lies in its many years of knowledge MCN operation experience, and its operation of "Blacksmith Media" has a number of financial head bloggers with video numbers, and whether it can operate virtual digital people mainly relies on three capabilities, content, technology and marketing (brand).
Technology supports the "skin bag" of virtual digital people, not only is it simple to be a simple personification of appearance, but also the image ability, expression ability, and perceptual communication ability must meet the standards.
In terms of content, it is "thought", such as "Mei ShiTian" to say talk shows from the novel perspective of virtual digital people, which will undoubtedly bring new views and speculative spirits, and Dr. Yu will analyze the metacosm and digital economy through short videos and joint virtual lectures with universities. At the same time, Dr.Yu is also based on reality, through the interpretation of economic policies, industry dynamics, etc., the output comes from the metaverse.
So I think it's not about what they say, but that the perspective and behavior itself leads to what the aforementioned "evolution of thought" is. After all, if you only have the ability to continuously output high-quality content, not to mention virtual digital people, to put it badly, you just put a dog on it also has some value, but these are the lower limits of a high-quality virtual digital person MCN agency, the core lies in having the idea of all things virtual, that is, the metaverse.
Brand and marketing ability is the most important condition for commercialization, a short video MCN practitioner believes that AYAYI is undoubtedly the top in the industry from the appearance point of view, but it is a pity that most of them are static pictures, from a professional point of view, it undoubtedly belongs to the "head change" stream, can take the "idol route" to get many big-name business, undoubtedly relying on first-class marketing capabilities and behind the resources, this point can be seen from its debut with Chen Weiting, but if it can not "move", such as a real idol to eat fan economy, I'm afraid it won't last.
Wang Boxuan told me that in the future, all the tracks corresponding to the subdivision categories of reality, there may be corresponding virtual digital people, digital people are rather an extension of all the actors, when one day the virtual digital people become another collective, the metaverse world may really come, for Dr. Yu's creative team, not only to output professional knowledge, but also to convey the worldview and values behind the metaverse. In addition, the customized services for corporate brand customers, as well as the transformation of ip influence that has been created into service-oriented and companion-type digital human hardware products, will also accelerate the "landing" of the meta-universe.
Virtual digital people are future-oriented narratives
It can be said that the virtual digital person is a future-oriented narrative, and people are interested in it because many prophetic people are interested in it, in the final analysis, they are still interested in the future, and once we all recognize the virtual digital person, then it is easy to start its connection with the real world.
So, what role should virtual digital people play?
Identity is the most important link in Roblox's eight elements of the metaverse, after all, if you don't even know "who I am" and "who you are", the game will not be able to continue. Following this line of thinking, it can be seen that the virtual digital person must be related to the identity of the person in the metaverse.
Source: Roblox Prospectus
If you agree with the view that man is the sum of social relations, and that a person exists in this society, there will be an inevitable relationship that is not transferred by the will of the individual, then if the virtual person wants to exist in the metaverse, it must have a social relationship with the person who enters the metacosm, so we may as well follow the human train of thought to see what the possible relationship between the virtual person and the present and future of us is.
Or, furthermore, what value can virtual people really provide?
The first is connectivity.
Connecting people to people, connecting people with brands, etc., you can think of a virtual digital person as an NPC with intelligence. I remember that Jingdong in the Year of the Dog, once released an animated short film, very well-made, and even the social platform often appeared in the name of "Dog East", of course, this is a love name, when you think of this dog, it will naturally start the connection with JD.com.
Therefore, I strongly recommend that JD.com immediately start the "virtual digital dog" project and plan for the future.
So can the virtual digital people launched by various enterprises form a better connection with users or customers in terms of image, I think it must be effective for enterprises that have not had this role before. For example, when you see "XiaoYi", you will think of China Aerospace, although AYAYI is not exclusive, you may also think of Alibaba.
The second is whether incremental information can be provided.
As mentioned earlier, what matters is whether you can have a new perspective and perspective like Mei Shitian or DR.Yu, so as to deduce a steady stream of new content, which is not only a matter of intelligence or not, but also the test of the content ability behind the team.
Now many banks, TELEVISION stations and other institutions, have launched their own virtual customer service, virtual host and other roles, such as Hunan Satellite TV's "Xiao Yang", PUB's "Xiao Pu", etc., if only like the current intelligent customer service, or simply rely on a good face to sell a cute, it is still only at the connection level to solve the problem, there is no incremental information, such as according to titanium media reports, "Hello Saturday" This program hosted by digital virtual people, the popularity will gradually decline.
Finally, there is care.
There is a social event that impressed me a lot, in 2020, a 60-year-old mother brushed a short video and fell in love with the "bully" Jin Dong, claiming that he had confirmed his intentions through video dialogue, in order to be with this fake Jin Dong, spent a lot of money not to say, but also fell out with her husband and children.
This is simply a large absurd scene, but it has to be said that people who fall into the "possession" mentality cannot be treated with common sense, just like many idol fans, once caught in this "possessive" mentality, it is not allowed to have a little filth and doubt.
Back to the virtual person, the so-called connection and incremental information in the front are only commercial considerations, and what can really reflect the value of the digital virtual person lies in the care of human nature. Is it difficult to implement? It seems that it is not difficult, Xiaoice all kinds of virtual digital people can draw, write poetry, and send circles of friends. Just imagine if Jin Dong has a virtual digital person, as long as he gives money, he may really call you, if Xiao Fu'er and Xiao Yan of "Breaking the Sky" have virtual digital teachers, and now the primary school students may not even save their early love. Although business succumbs to efficiency for a short time and becomes the enemy of human nature, it eventually returns to human care and becomes a friend of time.