Text/Zhao Jie, Ye Ran
As one of the entrepreneurial tracks with the highest threshold and the most durable cycle in the intelligent automotive industry, autonomous driving has been favored by capital in recent years, and the scale of investment and financing in 2021 has reached the peak in recent years. Since the beginning of this year, the heat of the capital market has once again made people look forward to the future of this track.
According to the data of the Intelligent Network Research Institute, in the first quarter of this year, there were 46 financing incidents for autonomous driving enterprises in China, with a total financing amount of more than 1.7 billion US dollars, and 6 companies received more than 100 million US dollars in financing. Its Chinese Yuanzhi bank became the domestic financing king in the first quarter with a financing amount of more than 400 million US dollars, with a post-investment valuation of 4.4 billion US dollars.
From a more segmented perspective, the mass-produced advanced driver assistance system (ADAS) had the brightest financing performance in the first quarter, attracting obvious gold, with the highest financing amount reaching 1.3 billion yuan. In this area, Yunjiu Capital, an early venture capital firm with nearly $2 billion in assets under management, has invested in three of the leading players, namely Tucson Future (http://TSP. US), Wenyuan Zhixing and Hongjing Zhi driving.
Financing of the domestic autonomous driving industry in the first quarter of 2022
Data source: public data, compiled by the Intelligent Network Research Institute, the first electric watchmaking
After rapidly completing two rounds of financing of more than 100 million yuan in 2021, Hongjing Intelligent Driving completed more than 100 million yuan of financing again in February. Its large-scale mass production of L2/L2+ADAS products in 2021 will achieve large-scale mass production of domain control products in multiple head OEMs in the second half of this year. In addition, the company also plans to officially mass-produce the L3-level trunk logistics smart truck HyperTruck One this year.
Self-driving truck company Tucson will go public in the U.S. in April 2021. Just this past May 4, it announced its financial report for the first quarter of fiscal 2022, and the company's first-quarter revenue was $2.264 million, an increase of 140% year-on-year and 10% month-on-month. Net loss of $112 million narrowed from a net loss of $385 million in the year-ago quarter.
Does the continued popularity of venture capital indicate that the development of autonomous driving has matured and begun to enter the second half? Minecarts, passenger cars, trucks, buses Which track will realize the commercialization of driverless cars first? How to reasonably value autonomous driving companies?
On April 28, First Electric and Wang Jing, a partner at Yunjiu Capital, held an in-depth communication about driverless driving at his office in Sanyuanqiao, Beijing. Wang Jing, who has 13 years of investment experience, led the completion of Yunjiu Capital's investment in Wenyuan Zhixing and Hongjing Zhichao. In his view, the actual commercialization of each track of autonomous driving still needs time, and it is only in the warm-up stage, which needs to be observed with a longer time dimension; from the perspective of business model, unmanned minecarts and unmanned buses may be commercialized at the earliest, but it will take time for large-scale landing.
Wang Jing, who is also concerned about large consumption, is more optimistic about the model of "retail + automatic driving", in his view, it is very likely to subvert the current business form in the future, with great imagination space.
In addition, Wang Jing also shared his investment philosophy and investment logic. As a long-termist, he pays more attention to the technical height represented by the enterprise and emphasizes the combination of financial returns and social value.
The following is a transcript of the interview, with deletions.
Wang Jing, partner of Yunjiu Capital
Autonomous driving is just starting to warm up and is far from reaching midfield
First Electric: What do you think of the commercialization prospects of different tracks in the field of autonomous driving?
Wang Jing: We have paid attention to the different classifications in the field of autonomous driving. In China, we believe that unmanned minecarts can be commercialized as early as possible, on the grounds that the scene is single, there is no complex road conditions, the product function is simple, whether it is a control system or a use scenario, it is relatively easy to implement. But because of this, for enterprises, cost reduction and efficiency increase are not clearly visible, and most companies in actual use only try to buy a few for experience. From the perspective of investment, it is generally analyzed that after this application is landed, there is no room for further imagination. Perhaps the future of mining autonomous vehicles will be very rich, but its commercialization path should not be the same development as seen today, and other changes should occur in the future.
Self-driving trucks are very mature overseas, especially in the US market, and capitalization has gone far, and can also be combined with electricity or hydrogen fuel, so the story can be told very richly. However, from the perspective of real commercialization in China, I personally feel that I will not see it in the short term. It involves many things, such as policies and regulations, public opinion and so on.
Sociality has always been a part of my focus in my investment philosophy. The so-called sociality, that is, no matter how mature the technology, capital, and products are, whether the large or small environment of the society in which it is located can recognize it, and whether the culture, concept, and consciousness can accept it, which is one of my reference indicators for future world investment.
The self-driving truck project is still in sight, but from the commercial landing, I think it is still far away. It is not short-term technology maturity or product maturity, forming a fleet or saving how much human capital, you can judge commercialization.
Passenger cars are closest to the public, the highest degree of attention, the government's support is also the largest, may be the earliest public opinion will accept, we have also made some layouts. However, due to the safety of people involved, the test time will be long, and it may be 5 years later or the current test status in a specific area.
Compared with minecarts, unmanned buses will also land quickly. But this field is more To G (government customer) business, is the government's attempt to upgrade the technology of public utilities, it is still difficult to really apply to people's livelihood or improve people's livelihood, in the short term, it can only be a test of a fixed line closed area.
If you divide them into these four categories, you will find that they are far from actual commercialization. I am personally more conservative, I think that the real commercialization, that is, in terms of commercial operation indicators such as revenue figures, needs at least 5 years, and before that, it should be the testing stage.
If you benchmark a "commercial driverless ride-hailing car", it may be 10 years later that such a scene will appear, and joke is that it is now more like a sightseeing train in a large playground, just for people to experience. The mature application of a new product or new technology in society not only revolves around the product or technology itself, but also means that laws and regulations, infrastructure, traffic conditions and even means of transportation must change.
The more sophisticated the product, the higher the requirements for the environment. It's hard to imagine a highly intelligent, self-driving vehicle with its own rules mixed with a bunch of people or cars that don't strictly follow traffic rules. Relatively speaking, the scene of a self-driving truck seems to be better realized because the road conditions are easier to set up and the scene is more closed.
"First Electric": Some people say that autonomous driving has entered the second half, what do you think?
Wang Jing: I think it's too early to say that the central game is too early. At the extreme, in 5 years from now, it would be right to vote at any point in time. If there is now a new team to bring new technology, new innovation, and capital to support, in line with the logic of investment can be invested. No matter which scene, there is a great opportunity.
Looking at this market 10 years later, who has the most commercial value, social value and capital value? Maybe it hasn't come out today. I feel that the warm-up has just begun, and the probability that 10 years from now it will really affect people's lives is not everything we see now. If I had to make an analogy, I think it might be like The Chinese Internet industry in 1992 and 1993.
First Electric: What stage would you prefer to choose to enter the enterprise?
Wang Jing: I would like to go a little earlier, such as when the company is just starting a business. Or more late, such as companies with listing expectations. These are all based on roi of investment considerations: early stage companies have more room to grow; late stage certainty is relatively strong. The time of exit is generally after listing.
First Electric: What is the size of your investment in each project?
Wang Jing: It is about $15 million, and there may be more individual projects.
First Electric: What changes are you paying attention to this year in the field of autonomous driving?
Wang Jing: Recently, most of our attention is related to new energy, including the latest round of new car-making forces, such as the Niutron brand, we have participated in the A round of financing.
First Electric: We have noticed that the scale of financing and cases in the field of autonomous driving in the first quarter of this year are higher than in the same period last year, will this situation increase the proportion of your investment in the field of automatic driving?
Wang Jing: In this field, you will pay attention to the changes in this industry, which is a typical "pregnant woman effect". I also recognize that the industry has been very hot this year, but this conclusion is not very important to us.
We don't just invest in autonomous driving, which is a reasonable proportion of our portfolio relative to investments in other areas.
Cloud Nine has its own investment strategy. As long-termists, we pay more attention to the changes in the next 3, 5 or even 10 years, including what will happen to the listing and even the exit, which is what I want to consider.
The "autonomous driving + retail" model has a huge imagination space
"First Electric": What do you think of the unmanned delivery vehicle at the end?
Wang Jing: In the past two years of the epidemic, we have done a lot of industry research. From the perspective of use, it is divided into two types: logistics and retail, both of which have a large number of companies.
Distribution includes urban road distribution, last mile distribution, park distribution, building distribution and restaurant and hotel robot delivery. It can be seen that the hotel and catering area has landed a lot, for enterprises, this part of the economic account can be calculated, is accepted and recognized, is a verified application. So I'm more optimistic about delivery in a closed area.
Driverless unmanned retail is one of the directions we are more interested in, because it may derive a new retail form. Movable, detachable, and freely combined, bringing about a new change and gameplay that we prefer to consider from a retail perspective.
In the past hundred years, the general stage of the retail industry has been operated in principle, and the most fundamental first element is the location, and it does not matter whether there is anyone or not. The emergence of automatic driving has completely subverted the location of the site, if convenience stores can move, then how should convenience stores be opened? How should the crowd be covered? How should all the evaluation systems and indicators of the retail industry be understood in the past? In the past, it was said that a shopping mall should be selected in a commercially intensive area with a large flow of people, while the mobile convenience store means that the requirements for these locations may have to change. Correspondingly, the construction of cities will also be decentralized. People do not need to go to a fixed place for the exchange of goods, all goods automatically arrive at the doorstep.
Therefore, autonomous driving with retail, it may change the form of the retail industry and even the city, this value will exceed the simple sum of automatic driving and unmanned distribution, any point you can not imagine may jump out, detonate it, the imagination space is very large.
Yunjiu Capital invests in a high level of technology
"First Electric": For autonomous driving companies, what is the reasonable valuation method?
Wang Jing: At present, it is difficult to say what a "reasonable" valuation method is. PS (price-to-sales ratio), PE (price-to-earnings ratio) and other methods commonly used in commercialization cannot calculate the financial account, and the valuation is more or the expectation of the future, lacking the support of the bottom of the market in other industries. This piece is not like the Internet companies many years ago, although the business model is not clear, but there is traffic, content, traffic, these can be monetized under certain conditions. But autonomous driving still lacks such support, and without a huge number of cars running on the road, it cannot be changed into real financial data.
But this is not important, stretched to 10 years of time, is a complete investment cycle. For investors, understanding the significance of the cycle is most important for their investment.
"First Electric": In addition to Wenyuan Zhixing, Hongjing Intelligent Driving and Tucson Future, which has been listed in the United States, in the field of autonomous driving, what companies has Cloud Nine Capital invested in?
Wang Jing: From the narrow sense of the field of automatic driving, these three companies have been invested so far. We have also invested in a number of domestic new energy vehicle companies, which also involve the automatic driving business.
First Electric: What kind of company do you think is worth investing in? Is it easier to commercialize?
Wang Jing: Whether it can be commercialized or not is just one consideration in many investment logics. For a technology-driven track such as autonomous driving, we choose a company, more because its technology represents a direction and boundary in this field, and the technical height it presents is one of the important factors we consider.
First Electric: Is the future of Tucson, which has already been listed, a success story? Has Cloud Nine Capital exited?
Wang Jing: From an investment point of view, it is obviously a success story. But from the perspective of industry development, as I said earlier, this is just beginning, and we are still looking forward to the more contributions that new technologies bring to social development.
"First Electric": In addition to funds, what resources or support will we give to the invested companies?
Wang Jing: The most important resource of investment institutions is the strategic direction. Investment institutions have their own perspective and can discuss with companies what the world is like and what will happen in the future. The second is human support. Investment institutions have a very strong network of contacts and talent mining systems, which can help companies find the different talents they want at each stage of development. The third is capital. Mature investment institutions, for the rhythm of capital are more aware, the next round of valuation, when to raise, when to list, each time node will be more accurate.
"First Electric": What is the daily communication mechanism with the investee enterprises?
Wang Jing: We are more flexible, except for some regular boards, which are basically a state of communication at any time. We also have weekly communication internally. When encountering some common problems, we will definitely have communication with the invested companies.
"First Electric": Does Cloud Nine Capital have any specific investment plans or budgets in the field of autonomous driving this year?
Wang Jing: We have been paying continuous attention to the industry, but we will not do "proposition composition", so it is easy to "take the hammer to find the nail", and we will lose the objective judgment of the market. From our portfolio, there will be a proportion of consumer, technology, biomedicine, etc., but it is difficult to say "how much will be invested in autonomous driving". From the investment logic, we will pay attention to and examine autonomous driving, and conduct research classification and analysis, and then visit related companies to finally form a conclusion. Once this process is completed, we basically form a judgment of whether to vote or not to vote.
For example, a year ago we were paying attention to self-driving minibuses, and now we will form a judgment on this classification, but we will continue to pay attention to this area, because there will be new content and new ways to play.
Autonomous driving counts our technology sector, and the technology sector is the focus area of our asset allocation, accounting for about 1/3. In addition to autonomous driving, we are also focusing on artificial intelligence, chips, databases and so on in this field.
Successful investments are a combination of financial returns and social benefits
First Electric: You are also the head of CIC (Combat Intelligence Center) at Cloud Nine Capital, how did you think about creating this department in the first place?
Wang Jing: Simply understand that this is an investment research team, but the difference with the traditional investment research team is that the traditional research team is a backstage or middle office team, checking data for information aggregation and analysis research, but CIC is the front desk, more like a sniper's observer, standing with investors, providing information with practical value and timeliness.
For example, for the visitor in front of me, CIC will quickly give me a briefing to tell me what the visitor's background is, who the organization is, what I have done, what problems I have, how to deal with it, and so on.
It's a quick-responding department, and CIC doesn't need a high-level intelligence officer, it needs to be focused. The concept of CIC originated from the "World War II" navy, where subdivided intelligence officers such as radar analysts or weapon systems analysts each provided intelligence, and finally summarized to the commander to make decisions.
Our team does not need many people, but they will study many fields, will provide us with very useful intelligence every day, and each of our intelligence is basically in the cycle of days or even hours, which is very time-sensitive.
First Electric: Have there been any projects in past investment cases that have particularly satisfyed you personally?
Wang Jing: I think it is far from satisfactory. The first criterion of my satisfaction is to bring a sufficiently large return to the fund, and the second is to solve the social problem, both of which are indispensable. Now many projects only meet one of these points.
For me, instead of studying a company's business model, I would like to pay more attention to whether the emerging format or product service has its soil, what changes its emergence can bring to society, and whether it matches society. I've seen too many new technologies in the last 10 years or so, but very few have actually come to life and commercialized them.
In the past 10 years, the only product that can subvert our lives is the smartphone from the root, and its emergence has brought about changes in the entire ecology. If I pitch such a product, I can say that I am satisfied or successful. Autonomous driving may change our lives in the future, but it is too early to see it, and it needs to be observed from a long time dimension.
Wang Jing Profile
Partner and Head of CIC (Combat Information Center). With 13 years of investment and 5 years of Internet entrepreneurial experience, focusing on enterprise services, industrial Internet, industrial Internet, cutting-edge technology and biomedical and other fields, the main investment companies include Jumei Premium, Find Steel Network, Wenyuan Zhixing, 51WORLD, Fast Plastic Network, ZEPP, Hongjing Intelligent Driving, Oriental Space, RootPath, etc.
Created and served as the head of CIC at Cloud Nine Capital. CIC aims to provide rapid and accurate intelligence support for investment teams through comprehensive collection, collation, analysis, judgment and distribution of market information, so as to assist in the high-quality and efficient completion of daily investment work.
Graduated from Beijing University of Aeronautics and Astronautics majoring in computer science, before joining Yunjiu Capital, he was the investment manager of K2VC and assisted in the establishment of the first phase of Jianfeng Angel Fund, and joined Lightspeed Anzhen China Venture Capital in 2014 as vice president.
About Cloud Nine Capital
Sky9 Capital is a leading venture capital fund dedicated to supporting outstanding innovators and disruptive technologies to create positive value for ecology, society and individual lives.
Focus on innovation themes in the fields of deep technology, Internet, consumption, corporate services and healthcare, help innovators through capital, strategy and resources, and promote the transformation of technological power into the key to solving social and ecological problems.
The team is made up of diverse backgrounds, including senior technologists, successful entrepreneurs and experienced investors. Since 2011, the team has managed a number of USD and RMB funds with nearly US$2 billion in assets under management.