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"My company now has more than 10 people, just finished financing, and wants to recruit a new group of technical personnel, and wants to use equity incentives to keep them, what should I do?"
"In the face of U.S. technology sanctions, what should we, the technology companies, prepare in advance?"
"The product has been piloted, and there are several orders from companies, and now we want to launch it to the market on a large scale, but most of our team are technicians, do we need to recruit a marketing partner?"
......
Ask questions without superfluous pleasantries and get straight to the point. There were more than 70 entrepreneurs sitting in the audience, divided into 6 groups according to different cities, and more than 10 seats were reserved for the last row.
As when they were students, they wore uniform coats, held course manuals in their hands, and listened carefully to the industry lecturers on the stage talking about "the way to survive in hard technology enterprises". The difference is that most of them already have gray hair on their heads and signs of age on their faces. Later, I learned that among them, the youngest is about 35 years old, and the oldest is in his 60s, and most of them have doctoral and master's degrees, and only 9% of them have bachelor's degrees.
The two-day camp was crowded with entrepreneurs in the fields of semiconductors, optoelectronics, advanced manufacturing, new materials, new energy, and cutting-edge technology.
Looking back at the past ten years of venture capital in China, entrepreneurship camps are not a new species, incubators, investment institutions, venture capital service platforms, and shared office spaces have all been held. Nowadays, is this still attractive to entrepreneurs? What role does the entrepreneurship camp play in the decade of China's venture capital and the era of mobile Internet moving towards hard technology? Do entrepreneurs really need to participate in the entrepreneurship camp?
Titanium Media venture capitalists sorted out the changes in the demands of the organizers and participants of the entrepreneurship camp in the past ten years of China's venture capital, and tried to get answers from them.
Take the carnival years of financing
A compulsory course for entering the game and starting a business.
The year 2014 is the starting point of "mass entrepreneurship and innovation", the transition period from China's Internet PC to the mobile terminal, the starting point of the competition between the first generation of US dollar VC and the new generation of US dollar VC, the climax period when the executives of large factories who see the results leave their jobs to start their own businesses, the turning point of the "grassroots" with courage and ideas to change their fate, and the turning point when you walk into a start-up camp and meet the investor "Xu Xiaoping" It's an era when anyone who gets financing can tell you what kind of stories investors like to hear.
"When I participated in the first and second phases of the Chaos Entrepreneurship Camp, I could be classmates with Zhuang Chenchao of Convenience Bee, Yue Bin from Gaorong Capital, Li Zhu from Innova Angel Fund, and Wang Xiao from Jiuhe Venture Capital. Yang Fei said.
"In the Dark Horse Entrepreneurship Camp, you can also talk with Mr. Xu Xiaoping of Zhen Fund, Mr. Zhu Xiaohu of GSR Venture Capital, and Mr. Li Feng, the founder of Frees Capital, to discuss the situation, submit project BPs, and discuss innovative business models. Zhu Haotian said.
Investors are the guests of the entrepreneurship camp, appearing on the list of lecturers of various entrepreneurship camps, and attracting entrepreneurs by virtue of their personal brand influence. "The era of Xu Xiaoping, the era of Shen Nanpeng, and the era of personal heroism, this is the starting point of the outside world's halo for investors. Zhu Haotian said.
They are the "dream mentors" of entrepreneurs with entrepreneurial intentions, and as long as you dare to think, they dare to vote. At that time, the official account of the Entrepreneurship Dark Horse Academy often released: A round of financing of 25 million yuan for a certain project, and the news of the founder of XX (a camper of Dark Horse Camp X).
"With hundreds of thousands of tuition fees, it is still worth it to get financing, at that time, FA was not yet popular, and participating in entrepreneurship camps was an important way for entrepreneurs to obtain financing. Zhu Haotian said.
(Image source network: some mentors of the Dark Horse Entrepreneurship Camp)
Selling courses and teaching entrepreneurs to raise funds is the core purpose of the camp. Looking at the courses of the entrepreneurship camp at that time, it is not difficult to find the answers: "Business Model in the Eyes of Investors", "How Investors Look at Enterprises", "What Does Investors' Favorite BP Look Like?", "How to Tell a Good Entrepreneurial Story and Win Financing".
Around 2014, the organizers of the entrepreneurship camp were mainly divided into five categories: the first type was venture capital service institutions, such as Dark Horse College, Leopard Change College, and Angel Growth Camp, which recruited entrepreneurs while lightly docking financing services to achieve bilateral income. "At that time, Dark Horse's course was 198,000, which was not cheap, so my income was also good. A friend who has done course sales in Dark Horse told Titanium Media Venture Capitalists.
The second type is venture capital media, such as the Venture State Entrepreneurship Camp and the Small Table Entrepreneurship Classroom, which not only empower investors' personal brands through media influence, but also provide exposure and financing docking for entrepreneurs. "When traveling to various cities, it is common to do recruitment and publicity. A friend who used to work in Venture State revealed to Titanium Media Venture Capitalists.
The third type is shared office and incubator, which provides investors with a list of projects while jointly holding entrepreneurship camps with investment institutions, such as Pusoft Incubator and Chenhui Venture Capital to hold Pusoft Entrepreneurship Camp.
The fourth category is business schools, such as the CEIBS Entrepreneurship Camp. "The entrepreneurs who participate in the business school are older, there are more traditional industries, they don't understand Internet entrepreneurship, but they have money in their hands and can be the LP of our fund. Investor Qin Fei said.
The fifth category is universities, such as the Beihang Summer Entrepreneurship Camp, Xi'an Jiaotong University Entrepreneurship Camp, and Peking University Entrepreneurship Camp, which mostly provide students with a window to understand entrepreneurship and establish entrepreneurial cognition.
Empowerment classes, business schools, growth camps, acceleration camps, venture capital universities, and entrepreneurship camps have sprung up like mushrooms after a rain, with the names of deans, mentors, and lecturers becoming new titles for investors, and some well-known investors holding positions in a number of venture capital training institutions.
In 2016, the emergence of the "second half of the Internet" argument pushed the carnival entrepreneurship camp to a new battlefield. "From the Internet to "Internet +", it means the end of one era and the arrival of another. ”
Reserved land for investment institutions
Another era has arrived.
The first thing to perceive is the investment side. Zhang Ying of Matrix Partners posted: "I strongly feel that the market is getting cold, and it is becoming more and more difficult to raise funds...... Those companies that are still blindly optimistic, you are waiting for death. ”
Wang Ran, CEO of Yikai Capital, followed: "The difficulty for entrepreneurs to obtain financing will increase significantly, and the failure rate of entrepreneurship will also increase significantly. ”
The dividends of mobile Internet entrepreneurship are gradually coming to an end, and the layout of the track has emerged head enterprises one after another, and enterprises in the middle and waist can only obtain the next round of financing through "life and death". The number of entrepreneurs has decreased, the fundraising winter has hit, and investors are no longer guests, but have begun to do hard work and tiring work to prove their professional ability.
The organizers of the entrepreneurship camp have been transferred, and the investment institutions have taken up the banner of "entrepreneurship training courses".
In 2016, Hillhouse Capital established the Collie Value Investment Research Institute, aiming to cultivate the backbone of value investment. In the same year, Sequoia Capital China, together with the Yale School of Management and the Yale Center Beijing, launched the "Yale-Sequoia Leadership Center", which aims to cultivate and enhance the leadership of entrepreneurs through a new type of entrepreneur classroom.
In 2018, Sequoia Capital China Fund and Zhen Fund jointly launched the high-end entrepreneurship research class "Ostrich Club", with Shen Nanpeng, Xu Xiaoping and Wang Qiang serving as resident mentors. In the same year, Jingwei Venture Capital established the Billions Entrepreneurship Camp, and GGV Capital launched the Maker Marathon.
Many small and medium-sized venture capital institutions have also joined the ranks of "entrepreneurship training courses", such as Galaxy Venture Capital founded "Galaxy University", Chixing Venture Capital founded "Foresight University", Hanli Capital founded "A Series A Academy", and Kenyi Club founded "Financing Acceleration Camp".
Zhang Ying has publicly said: "Excellent companies in all industries are seeking change, and it requires founders to think about how to use technology to optimize models, improve efficiency, and improve cash flow." Innovative marketing methods, continuous team iteration, and better balance the conflict points between long-term development and short-term performance require everyone to systematically learn and build. For a while, building a complete set of venture capital education and training system seems to have become the consensus business of investment institutions.
(Image source: Network: Some mentors of the Billions Entrepreneurship Camp)
Different from the period of entrepreneurship and entrepreneurship, most of the "entrepreneurship training courses" founded by investment institutions adopt the "selection system" for enrollment. For example, the Billions Entrepreneurship Camp only recruits the core founders of startups, mainly in rounds A and B, plus a small number of entrepreneurs in rounds C and D.
"This adds a link to the traditional process of looking at a project, creating a new pipeline and providing a deeper look at the founders and their business models. A senior investor said.
In fact, the course content has been upgraded from the theory of the entrepreneurship and entrepreneurship period to the actual combat and cross-border resource connection. For the operation team of the Billions Entrepreneurship Camp: "All the courses, operation and maintenance, and offline connection/resource matching are creating as much value as possible for entrepreneurs." ”
For example: how to achieve growth efficiency innovation, how to improve human efficiency, how to do a good job in the portrait of a high-performance management team, how to plan cash flow and budget, how to view efficiency and effectiveness, when to introduce strategic investment, how to view the BCA clause of strategic investment?
When the cold winter comes, investment institutions cherish the bullets in their hands even more. According to the data, in May 2019, a total of 38 funds entered the fundraising stage, a year-on-year decrease of 57.78%, and the total target fundraising scale was only 6.63 billion US dollars, a year-on-year decrease of 91.44%. It can be seen that the difficulty of raising funds is a normal problem faced by investment institutions.
It is different from the mobile search for entrepreneurs in the period of entrepreneurship and entrepreneurship. Investment institutions have begun to consciously establish their own entrepreneur network resource pool, track the growth status of entrepreneurs, and reserve follow-up projects. At the same time, it also screens potential LP resources to prepare for fundraising.
For entrepreneurs, it is a must for refinancing.
"Slowing growth, how to break through the traffic dilemma, how to continue to get financing, and how to achieve profitability are the common dilemmas of most Internet entrepreneurs around 2018. When I can't solve it myself, I start to seek help from investors and link the resources of entrepreneurs in the circle. Zhu Haotian said.
Investors devote more energy to their own start-up camps, and occasionally make guest appearances as guests of external start-up camps.
The landing "training course" of the national team
"You think that the rules of this game are to upgrade and fight monsters, but the result is to rewrite the rules, tear down and rebuild. Investor Qin Fei sighed.
On the fund-raising side, the national team has become the main investor in the primary market, and its appeal is to attract investment and return investment; on the investment side, "all employees" have reached a consensus and focused on new energy, new materials, chips and semiconductors in the direction of national policies, and the talent teams with backgrounds such as professors, scientists, presidents/vice presidents, and serial successful entrepreneurs have generally obtained financing, orders, factory expansion, and production.
At that time, the organizers of the entrepreneurship camp shifted again, and the local venture capital service platform, the park, and the investment promotion office threw an olive branch to the investment institutions to seek cooperation with the local entrepreneurship camp, and the core appeal was to recruit hard technology enterprises to land and complete the investment promotion indicators.
For example, USTC Silicon Valley is a full-life cycle platform for hard technology enterprises led by Hefei City, focusing on incubation, seeding, growth and maturity, from the park, to the fund, and then to the resource link of local leading enterprises, providing one-stop services for enterprises landing in Hefei.
Not long ago, they jointly held a two-day hard technology entrepreneurship camp with Zhongke Chuangxing. On the first day of the camp, Zhong Deying, deputy secretary-general of the Hefei Municipal Government of Anhui Province, presented the flag to the camp and delivered a speech to promote Hefei's strategic emerging "6+5+X" industrial system, 6 leading industrial clusters, 5 leading industrial clusters, and "X" represents the need to continue to track a number of cutting-edge technology directions.
On the second day of the camp, Xu Jingming, co-founder of iFLYTEK, was arranged as a lecturer in the morning to talk about the challenges encountered on the way from "Scientist to Entrepreneur" and give practical entrepreneurial advice to hard technology entrepreneurs.
As we all know, iFLYTEK is a representative local hard technology enterprise in Hefei, which owns CVC and invests in artificial intelligence-related industries.
During the break, entrepreneurs rushed to add Xu Jingming's tutor's WeChat, which in their eyes was a potential order + investor.
In the afternoon, he led the students of the entrepreneurship camp to visit JAC, and arranged an on-site roadshow for entrepreneurs related to the automobile industry chain.
It is not difficult to find that investment institutions are also "flexing their muscles". For hard technology enterprises, investment is an important part of their start-up, and if they want to develop positively in the long run, they still need continuous orders and cash flow, and it has become the core competitiveness of investment institutions to connect with industrial order resources.
In the second half of 2023, HKUST Silicon Valley held activities such as the "Science and Technology Equity Practical Camp", "Future New Hui Businessmen" and "Advanced Seminar for Science and Technology Entrepreneurs", with more than 500 companies participating in the offline training. The person in charge of the Silicon Valley activity of the University of Science and Technology told the titanium media venture capitalists.
"We have cooperated with HKUST Silicon Valley in the synthetic biology investment course, and we are the investment promotion team of the attraction department. A PR of an investment institution revealed to Titanium Media.
HKUST's Silicon Valley model is the epitome of local investment. In the era of all-staff investment, investment institutions have gradually become channels for investment cooperation, and their attributes of mining unicorns seem to be weakening.
The mode of the entrepreneurship camp has also changed, no longer a simple lecture and teaching entrepreneurs how to start a business, but a local government to show industrial strength, show investment policies, and show resources to leverage.
"It is better to participate in local entrepreneurship camps than to find investment institutions, investment institutions do not have much money in their hands, and there is no independent decision-making power, if the enterprise needs a large amount of capital to put into production, they will take the project to meet their own state-owned LP, and negotiate the landing matching resources together, which is no different from direct contact with local state-owned assets. An entrepreneur who participated in the entrepreneurship camp said.
Another entrepreneur believes that "the difference is that high-quality projects can get more local policies with the endorsement of investment institutions." ”
The owner of the capital controls the direction of the flow of entrepreneurs. Hard technology investment began around 2019, and in just a few years, state-owned LPs accounted for more than eighty percent.
Looking back at the data, since the acceleration of state-owned assets and CVCs in 2020, the scale of RMB fundraising in 2021 increased by 88.6% year-on-year, and the fundraising scale of foreign currency funds increased by 62.6% year-on-year, in 2022, the scale of RMB fundraising increased by 0.4% year-on-year, and the scale of foreign currency fundraising decreased by 18.6% year-on-year, and in 2023, the scale of RMB fundraising decreased by 10.1% year-on-year, and the scale of foreign currency fundraising decreased by 56.4% year-on-year.
It has become a consensus to embrace state-owned assets and serve state-owned assets.
Venture capitalists say:
"Entrepreneurs are lonely", the entrepreneurship camp has become a rigid scene for entrepreneurs in every era to huddle together for warmth and seek external brain support. Like the bonfires lit in the wilderness during the dark adventure, their respective light and heat gather groups of adventurers, provide them with solace and rest, and support them to continue moving forward tomorrow morning.
Entrepreneurship camps have become a necessary and indispensable part of the era of venture capital. At the same time, the changes in the mentor lineup, course content and organizers of the entrepreneurship camp have also become the epitome of the changes in the era of venture capital.
In today's increasingly "difficult" entrepreneurship, we even miss the era when the circle of friends was occupied by "entrepreneurship camp" advertisements and mentor lineup posters... (At the request of the interviewer, Qin Fei, Yang Fei, and Zhu Haotian are pseudonyms in the article) (This article was first published on the Titanium Media App, author|Guo Hongyu, editor|Tao Tianyu)