Text: Wei Xi
At the end of March this year, nearly 1.56 million 5G base stations were opened on the mainland, and the number of 5G mobile phone users has reached 403 million. Among them, China Mobile has built more than 800,000 5G base stations, accounting for about 30% of the world's 5G base stations. Among the top 3 communication equipment manufacturers in the world, Huawei ranks 1st with a market share of 28.7%, while Ericsson and Nokia rank 2nd and 3rd with market shares of 15% and 14.9%, respectively.
However, Nokia and Ericsson, two major international communications giants, have announced their withdrawal from the Russian market. In this case, foreign media said: "Just for the sake of China.". It is worth mentioning that on April 27, drone manufacturer DJI also announced the suspension of all business activities in Russia. DJI said it is reassessing compliance requirements in different jurisdictions internally and engaging with other stakeholders such as customers.
Mentioning that DJI is really known to everyone, it has a well-known reputation in the field of unmanned aerial vehicles, and now, in the global market, it can be said that no one can surpass it. DJI began to study drone products in 2006, and now it has been 17 years, in which more than a decade, DJI has continuously improved the quality of its products and increased its market share.
According to relevant data, DJI currently occupies more than 80% of the drone market, and no one does not recognize DJI's drone products. With its ultra-high market share, DJI's revenue is also rising, with sales reaching 26 billion yuan in 2020, and DJI's board of directors has predicted that DJI's revenue will reach 170 billion yuan in 2022.
As a giant in the drone industry, DJI's prospects are also optimistic about the capital market, and the valuation is very high. In the "2020 China Unicorn List TOP100" released by Ai Media Consulting, DJI ranked 7th with a valuation of 166 billion yuan. In fact, if DJI is listed, with DJI's market share, the valuation will be higher, so why has DJI been established for so many years and has not been listed? What's the reason behind this?
History of DJI
Speaking of DJI, we have to mention its founder, Wang Tao from Hangzhou City, Zhejiang Province. Wang Tao can be said to be an extraordinary person, and when Wang Tao was very young, he developed a strong interest in model aircraft. Before he went to college, model airplanes were a hobby of his, but after he went to college, he turned his hobby into a career.
Wang Tao, a student at the Hong Kong University of Science and Technology, set his graduation project as the flight control system of a remotely controlled helicopter and began to conduct research with his classmates. Although he was ultimately unsuccessful, he also gained the favor of his mentor and the opportunity to continue developing drones. During graduate school, Wang and his friends raised HK$2 million and founded what is now DJI in Shenzhen.
However, at the beginning of its establishment, DJI only had 4 employees, and the development of the entire team was limited everywhere. Later, Wang Tao brought in tutors to join the group, who brought not only money, but also many capable students. Since then, Wang Tao's team has expanded to 4 people. After many modifications, DJI's first relatively mature helicopter flight control system XP3.1 was officially launched, and DJI began to emerge in the industry.
The outbreak occurred in March 2015, when DJI launched The Mirage 3, a truly all-in-one quadcopter drone. In the three years from 2015 to 2017, DJI's revenue doubled year by year, from 5.98 billion yuan to 17.57 billion yuan. Its founder Wang Tao said that "the future can do everything", they will not produce the world's second- and third-rate products, but to make a product that can meet the world's highest requirements.
What did DJI rely on to become a tech giant?
First of all, DJI UAV has a strong core technology, which is difficult to replace by other UAV brands in a short period of time, plus DJI is one of the few completely independent research and development companies that have appeared in the mainland and have not copied the world's first-class technology companies. It ranks 29th in international patent applications, with more than 4,600 patent applications ranging from aircraft, aviation, space navigation to B64.
More than 25 percent of DJI's more than 8,000 employees are engaged in research and development, and DJI has mastered a set of hardware and software and various technologies needed in the development of drones many years ago. Coupled with the development in recent years, many previous core technologies are constantly being transformed and improved, so that DJI UAVs can maintain an important position in the consumer UAV market.
As long as DJI's scientific and technological research and development capabilities remain in a leading position, there is no need to worry that the United States will continue to suppress DJI with issues such as "core data leakage". On the other hand, DJI drones are cost-effective and have low thresholds. Previous drones were very small, with high thresholds and high prices, and ordinary people generally could not afford them.
Until 2012, DJI Mirage 1 was released, priced at less than 5,000, becoming the first choice for science and engineering students, and DJI successfully captured the first users. And relying on the advantage of super cost performance, DJI drones have gone abroad and been purchased by more people. In addition, DJI has always been based on the development concept of "omnipotent in the future", and it has also developed products according to the differences in the markets of various countries.
Cost-effective products, technical support and other factors have promoted DJI's popularity in the field of civilian and military drones. Therefore, although DJI has not yet been established for 20 years, it has already occupied most of the market share with the advantages of independent research and development technology. According to market analysis, DJI's current market value has reached 160 billion, but they still have not chosen to make this move to go public.
Reasons for not listing
No shortage of money
At the beginning of the first wave of financing in 2013, DJI held an attitude that it would not bet, not list, not open internal due diligence, and investors could not affect the company's operations. DJI insiders have said that DJI can raise funds in a variety of ways and does not need to be listed to raise funds. According to the data, since January 2013, DJI has completed six financings, including Sequoia Capital China, Vision Capital, Maxing Investment, China Star Light, New Horizon Capital, Accel Partners, etc.
Don't want to be eroded by capital
DJI is not listed, a large part of the reason is that it does not want to be eroded by capital, to know that in the field of science and technology, the most important thing is that the core technology needs to be continuously invested in research and development, DJI UAV is also a high-tech enterprise driven by scientific and technological innovation. If DJI chooses to go public, its development will be interfered with by funds.
At that time, not only will the research and development of its core technology be interfered with, but the overall development layout of DJI UAVs will also be affected. For a dream-minded business like DJI, it's clear that they don't want to be over-interfered with by capital. The most important thing is that once DJI is listed, it will be infiltrated by some foreign capital, which will be the fuse for DJI, which originally had no worries and embarked on an uncertain road. Therefore, not listing is the wisest choice.
What do you think about that?