There are two outcomes for an industry: Royole to the right and JD.com to the left

On April 13, Liu Shuwei, a professor at the Central University of Finance and Economics, published an article on his public account entitled "Saving Royole", pushing Royole Technology, a unicorn enterprise that was once estimated at 50 billion, into the spotlight.

Royole Technology started with a flexible screen, all the way high and low, and now it is in a deep financial crisis, and the light is no longer there; while another screen production enterprise, BOE, started from a company on the verge of bankruptcy, and after several tribulations, finally achieved global leadership.

In the same screen manufacturing industry, Royole and BOE two companies out of different development paths.

1

Royole Technology was born with the "golden key".

Liu Zihong, the founder of Royole Technology, has won the first prize in physics and chemistry in the National Olympiad, and is the winner of the college entrance examination in Fuzhou, Jiangxi. After graduating from Tsinghua University, he obtained a doctorate from Stanford University in the United States, and was a senior engineer in IBM's global R&D center before returning to China to start a business.

Royole's main attack direction is flexible full screen and flexible sensor. Different from the mainstream LTPS technology route of Samsung, BOE and other markets, Royole independently developed ULT-NSSP technology, and claimed that this technology can greatly shorten the process process, greatly improve yield and display effect.

At that time, flexible screens were regarded as the next technological revolution in the field of semiconductor display, and the birth of Royole Technology made everyone see the possibility of Chinese companies surpassing foreign monopoly technologies in major technologies.

The glittering founder's resume and unique technology naturally became the darling of capital.

As soon as Royole Technology was established in 2012, it attracted major investment institutions including IDG, Shenzhen Venture Capital, and Kunpeng Capital. In just a few years, Royole Technology has raised 13 rounds of financing, obtained more than 6 billion yuan of equity investment, and a number of investment institutions are flocking to it.

Xu Xiaoping, who missed the investment, even said: "Royole Technology is a real missed project since I made investment." Every time I see their good news, my heart is like a knife. ”

In contrast, BOE's entrepreneurial road is quite bumpy.

BOE was founded much earlier than Royole Technology. At the beginning of its establishment, there was no founder resume endorsement, no venture capital agency attention, and even the first LCD panel production line was second-hand.

In 2001, BOE invested in the purchase of Hyundai's LCD panel production line in South Korea. After digesting and absorbing the acquired technology, BOE independently built a 5-generation line. Two years later, mass production was successful.

BOE was not born at the right time, and BOE, which had just achieved mass production, was unfortunate to catch up with the downward channel of global LCD panel prices and encountered the "cold winter" of the industry.

In 2005 and 2006, BOE lost money one after another, was warned by the stock exchange with a cap, and was only one step away from delisting. Major banks have downgraded BOE's credit ratings and recovered loans in advance. As an example, in order to obtain the extension of a 10 million yuan bank loan, BOE had to plead with a commercial bank several times.

The major media also sneered at BOE, questioning whether BOE needs to take huge risks to continue to invest, questioning whether BOE is a fraudulent company, almost forcing BOE into a desperate situation.

2

Royole Technology, which has won the favor of capital, has been moving continuously.

In October 2015, Royole Technology invested tens of billions of yuan to start preparing to build the world's first flexible screen mass production line, and announced mass production in June 2018.

However, according to the prospectus of Royole Technology, its design capacity of fully flexible displays in 2018 and 2019 was 11.67 and 46.67 thousand sheets, respectively, but the actual production capacity was 1.26 and 14.56 thousand sheets, respectively, and the capacity utilization rate in the two years was 15.1% and 31.2%, respectively, far lower than expected.

In order to expand the market, Royole hopes to develop both to C business and to B business.

Although Royole Technology has repeatedly claimed to be leading technology, but the mainstream domestic mobile phone manufacturers Huawei, Glory, Xiaomi, etc. have not chosen to cooperate with it, during which Xiaomi and Royole once had a war of words about who is the first mobile phone with flexible screen. Only ZTE Mobile has publicly acknowledged cooperation with Royole, but there has been no follow-up for a long time.

Cooperation is hopeless, Royole Technology launched its own mobile phone brand Flex Pai, which ranked at the bottom of sales in major malls.

In the B-end market, according to the official data released by Royole, it has cooperated with empty cars and buses, China Mobile, etc., but has not seen the practical application of large-scale landing of flexible displays.

As a friendly businessman, BOE is steady.

After surviving the industry winter, BOE also mastered the industry's "counter-cyclical investment law", in the face of the sluggish market, other panel manufacturers have stopped investing in expansion, slowing down the pace, while BOE has opened up full horsepower, against the trend of expansion, seize the market.

Among BOE's many partners, Huawei is particularly worth mentioning. At the beginning of the boe mobile phone screen production, Huawei was popular and equipped with BOE's mobile phone screen in a variety of Huawei products.

As Huawei's mobile phone sales soared, BOE also received more recognition. After obtaining positive feedback from the market, BOE has steadily improved both the quantity and quality of its products.

In 2021, in the midst of a wailing in the capital market, BOE released a dazzling performance forecast. BOE's annual revenue exceeded 215 billion yuan and net profit exceeded 25 billion yuan, ranking first in the world in five mainstream application fields such as mobile phones, TVs, tablets, laptops and monitors. BoE's several mobile phone screen production lines have achieved full production and full sales, and have successfully become the supplier of Apple's mobile phone screens.

The story of BOE and Huawei has another story. BOE met the best Huawei in a difficult time, but Huawei failed to wait for the best BOE because of sanctions later, which made many people uneasy.

3

At the beginning of 2020, the media broke the news that Royole Technology was about to go public in the United States, but there was no follow-up. At the end of 2020, Royole disclosed the prospectus and wanted to sprint to the domestic science and technology innovation board, but two months later, royole technology's listing road was also pressed the pause button.

According to the explanation of the company's founder Liu Zihong, the failure of the first US listing was affected by the epidemic, and the second listing failure was due to the "ant incident".

The roof leaked during the overnight rain. Sales did not meet expectations, the listing sprint failed, and Royole Technology soon fell into a financial crisis. At the end of 2021, a number of Royole employees broke the news on social platforms that Royole had begun to default on employee compensation.

Subsequently, Liu Zihong shared a report about Tesla CEO Musk, and at the same time wrote in the circle of friends, "In the darkest moments of life, don't expect to send charcoal in the snow, the only thing you can do is to stick to the end and never give up." ”

Entering 2022, Royole's situation has not improved, and news about Royole's lease withdrawal, mortgage and loan is still frequently reported.

On the question of whether to save Royole Technology, two different voices have emerged.

One voice believes that the government should be returned to the government and the market should be returned to the market. In fact, the major investment institutions that had previously placed high hopes on Royole have also held a wait-and-see attitude.

At the end of last year, the Shenzhen Municipal Government set up a special class to intervene. Shenzhen Venture Capital, which has a state-owned background in Shenzhen, also decided not to invest more after some discussion. After experiencing the cycle of continuous financing and continuous lack of money, many people questioned the problems in the technical route of Royole Technology, pointing out that Royole is a fraudulent company that only does PPT.

Another voice believes that governments at all levels should carry out a bottom-up, actively help Royole Technology to solve the shortage of funds, and help Royole Technology introduce strategic investors.

In the history of BOE's development, it has also experienced a darkest moment similar to Royole Technology. The difference is that local governments have helped BOE and become boe's white knights.

Among them, the Hefei Municipal Government tightened its trouser belt, invested more than 10 billion yuan in real money and silver to support BOE, and at the same time gave JD.com convenience in terms of land supporting conditions, energy supply, loan discounts, etc.; Chongqing Municipality invested 32.8 billion yuan with BOE to cooperate in the construction of a new generation of LCD panel production lines.

The Ordos Municipal Government of Inner Mongolia will allocate corresponding coal resources within the mining area and hand them over to BOE for disposal.

BOE's several times to turn the danger into a disaster, in addition to its own hard work, partners to help, but also inseparable from the full support of local governments. And BOE is also quite contentious, after surviving the crisis, to give back to the local governments rich industrial and tax returns.

Today, Royole Technology faces a similar dilemma. But even if there is a local state-owned asset to save Royole at this time, will Royole grow into the next BOE?

4

Professor Liu Shuwei once became famous for exposing Lantian shares and LeTV fraud. For the dilemma of Royole Technology, Professor Liu Shuwei summed up the lack of operational experience of the management.

In fact, investors understand that this should not be the only reason why Royole is in trouble, in addition to operation, Royole Technology has too much homework to make up.