Source|IT Orange Author|Wu Meimei Cover Picture|Pixabay
Recently, we noticed that the stake of a veteran company that has been in business for more than 10 years, "Douding.com", was sold for one million.
The first reaction when I saw this news was quite shocking, mainly because there were two main points: first, this ancient Internet company was still alive; Second, the price of the transaction is only 1 million, and it is 100% of the equity of the entire company, so the price can be said to be very low.
Next, let's take a look at the whole story.
The new third board company made a price of 1 million yuan to divest the main business
In October last year, Beijing New Future Technology Co., Ltd. issued an announcement on the New Third Board to sell its 100% stake in Douding Century to Floating Whale (Beijing) Network Technology Co., Ltd. and Yan Xiaojing at a price of RMB 1 million, and Mai Gang resigned as the legal representative, executive director and manager of Douding Century. It can be seen that the sale has been a decision and idea for the past two years, but now the deal has been officially concluded and has come to an end. According to industrial and commercial information, at present, Douding Century (Beijing) Network Technology Co., Ltd. has completed the industrial and commercial change registration procedures for equity transfer and other matters. This also means that the online document sharing website "Douding.com", which has been operating for more than ten years, may have since withdrawn from the stage of history.
According to public information, Douding was founded in 2008 and is committed to building a global C2C Chinese document sharing platform; At that time, Scribd, a well-known document-sharing website in United States, was launched in 2007, and it can be said that this is a very old Internet product. And Lin Yaocheng, the founder of Douding.com, also meets the standards of mainstream entrepreneurs in the eyes of traditional VCs earlier - MBA degrees from Kochi and Stanford University, Chinese who have returned to China to start a business, have a senior technical background, and have successfully started a business (once started a business in United States, and the project was successfully sold). Judging from public information, for so many years, Douding has never released financing information to the public. And this time, the seller, that is, the parent company of Douding.com, Xinchuang Future, is currently a company listed on the New Third Board, and has also received a lot of venture capital in the primary market. According to IT orange data, New Future won the angel round of Venture Factory in 2008, and subsequent investors include China Merchants Capital, Qiming Venture Capital, Shanda Capital, Haier Capital and other well-known institutions.
According to the announcement information, after this equity transfer, the main business of the new future is no longer the business document sharing service, and it plans to revitalize the company's business through business transformation or asset injection, and gradually achieve the goal of stable business development; The company plans to further analyze its existing assets and improve its operating structure by optimizing its business model.
After the divestment of the core assets of Douding.com, the business that may be done in the future is mainly a business incubator, after all, the actual controller of the company, Mai Gang, is an angel investor and the founder/CEO of Venture Factory.
Why is Douding Network being sold cheaply?
As the company's core asset, how did Douding.com end up being sold cheaply? The results are embarrassing, but they have long been traced. We try to understand the facts by analyzing them from three aspects: financial data, business model, and industry competition. First of all, it is true that the business is small and unprofitable, and the income has fallen particularly sharply in the past year.
According to the annual report data released by Xinchuang Future, in 2022, the company's operating income will only be 32.334 million yuan, and in 2023, the company's revenue will only be 17.965 million yuan, a year-on-year decrease of 44.4%, a decrease of nearly half; It was also the company's lowest revenue year in the last 10 years. Let's take a look at what happened, and what was the reason for the decline in revenue?
From the composition of revenue, it can be seen that the decline trend of advertising revenue in Xinchuang Future is particularly significant, from 2020 to 2023, the decline will continue in the four years, of which the decline in 2023 will be the most significant, from 6.2033 million yuan in the previous year to only 1.46 million yuan in revenue. In addition to a slight rebound in 2021, the revenue of document income has also continued to shrink in recent years, from 34.92 million yuan in 2021 to 26.13 million yuan in 2022 and 16.504 million yuan in 2023. This also reflects the poor living environment of small and medium-sized enterprise advertisers, reducing expenses, resulting in a sharp decline in the company's advertising revenue; On the other hand, it is also external competition and impact, industry changes, so that the document revenue has been reduced by more than half. In addition, the company is facing relatively large losses at the financial level. In the first half of 2022, the company's net loss was 217 million yuan, a change from the previous state of being able to make a profit, and in the same period of 2021, it could also make a net profit of 156 million yuan. From the perspective of the company's overall gross profit margin, the gross profit margin in 2023 will drop directly to -45.72%, almost becoming a negative asset. Therefore, from a fundamental point of view, the company's overall annual operating income of less than 50 million over the years is relatively last in the new third board company, and the growth is not good, resulting in extremely poor liquidity and no trading for several years. Second, there are some possible flaws in the business model that are difficult to avoid. Since its birth, Douding.com has been controversial about copyright issues, especially after commercialization/payment, and the problems surrounding copyright and its infringement have emerged one after another. The copyright problem has been a long-standing problem in the Chinese Internet, because under the operation of the C2C model, the copyright B party is directly skipped, and the Internet is originally a free sharing community, and everyone is based on the principle of voluntary and sharing. But later, driven by the improvement of legal policies and related services, and the commercialization, there were various differentiations: the documents uploaded by users are likely to be second-hand forwards and do not have the copyright owners who upload the content; The platform shares the revenue with the uploader, and the copyright owner does not receive or even knows about it...... If Douding has always adhered to the C2C model and does not reform, this is a common and obvious defect.
According to the company's information, in the past ten years, there have been 475 legal litigation cases related to the main body of Douding.com, of which 75% are defendants, and the main causes of infringement involve copyright, the right to disseminate works online, the right to reputation, intellectual property rights, etc. From the perspective of the main body, many of the plaintiffs in the case are still natural persons, and the amount involved is relatively small. The biggest one should be the copyright infringement case between the Electronic Industry Publishing House and Douding.com in 2015, where Douding netizens provided more than 10 scanned copies of books from the Electronic Society to be paid to read online and display advertisements, which directly led to Douding.com being forced to pay 209,000 yuan. In March last year, in the advertising pictures and texts (communication and promotion articles for corporate customers) released by Douding.com, he was also fined 90,000 yuan by the Beijing Haidian District Market Supervision and Administration Bureau for using female images such as Ni Ping and Yuan Quan without authorization, violating the advertising law. It shows that the company did not strictly review the content of advertiser customers, and abandoned some basic content and advertising principles for the sake of revenue. Finally, from the perspective of industry competition, the core advantages of Douding Network are getting weaker and weaker. The advantage of Douding is that there is a deep accumulation of documents and materials in all walks of life, and for C-end users, the main profit model of Douding is to rely on paid documents, and this part of the income has accounted for more than seventy or eighty percent of the revenue in the past five years.
Then, there are two main types of audiences: one is the college student group, which needs to study learning materials; The second is professionals, mainly to meet office needs. Not to mention, it is fighting to the death directly with Baidu Library, Daoke Baba, and other peer competitors, and the competition from the periphery is more fierce and invisible. On the one hand, when office document giants such as WPS and Microsoft are pushing membership payment services, a large number of document template content is implanted, which further eats away at the original share of Douding.com. With the development of domestic AIGC and text models, their application scenarios are richer and more comprehensive, such as college students to research and write papers, and AI can do more things; And the product power of Douding Network is getting weaker and weaker. On the other hand, in recent years, after experiencing a wave of knowledge payment in China, the user payment habit seems to have been formed, but users are more willing to accept membership-style long-term services, paid services for courses, etc., and for a single document payment, the attractiveness and sense of value provided are still weaker.
Do you still know about Douding.com? How many people are still using peeweas?
WeChat has been revised again, and if you don't mark the star, it's easy to miss our push, and you can't see the cover picture. Please also click on the star to receive every new Tweet in time, and we look forward to seeing you every time.