Perfect Diary, finally standing on the IPO bell ringing stage.
Investment community (id: pedaily 2012) November 19 news, tonight, the new domestic beauty brand Perfect Diary parent company - Yixian E-commerce successfully IPO on the New York Stock Exchange. The IPO was priced at $10.5 and had a market capitalization of nearly $7 billion (about 46 billion yuan).
This is a rare phenomenon-level growth case in the venture capital circle in recent years. Three male students who graduated from Sun Yat-sen University broke into the beauty field, established Yixian E-commerce in 2016, and launched the Perfect Diary brand a year later, which rose rapidly. According to the prospectus, the total sales of Yixian E-commerce in the first three quarters of 2020 were 3.8 billion yuan.
Behind the Perfect Diary, there stand a number of well-known venture capital institutions, including Zhen Fund, Hony Venture Capital, Hillhouse Venture Capital, Gaorong Capital, cmc Capital, Boyu Capital, Tiger Global Fund, Warburg Pincus Investment, Carlyle Investment Group, Zhengxin Valley Capital, etc. Tonight, with the IPO ringing the bell, the investment direction behind the investment community tells the story of the rise of Yixian e-commerce.
Three boys make up:
Perfect Diary rises, achieving a market value of 46 billion in 4 years
To the surprise of many, the story of The Perfect Diary begins with three boys.
The three founders all graduated from Sun Yat-sen University. Among them, the company's soul figure Huang Jinfeng entered Procter & Gamble after graduating from university, and a few years later he chose to study abroad. In 2013, Huang Jinfeng returned to China after his MBA program at Harvard, and like most young people with entrepreneurial dreams, he kept thinking: To start a business or to get a job?
Xu Xiaoping of the Zhen Fund sent him 6 words - first study, then fight. Huang Jinfeng felt that it was very reasonable. At that time, he had already seen the huge prospects of the beauty industry in China, and immediately entered the domestic skin care brand Yu NiFang as a vice president, with a high starting point. P&G and Yu Ni Fang's work experience has provided great help for him to start a business in the future.
In 2016, Huang Jinfeng left Yunifang and founded Yixian E-commerce, the parent company of Perfect Diary, together with Sun Yat-sen University alumni Chen Yuwen and Lv Jianhua. They have explained that Dr. Sun Yat-sen is also called Yixian, and the company took this name to pay tribute to the alma mater. In the early days of entrepreneurship, three people often ran all over the world in order to investigate various offline stores and enterprises in Japan, South Korea, Europe and the United States, and secretly learn art.
From left, they are: Chen Yuwen, Huang Jinfeng, And Lv Jianhua
In March 2017, the perfect diary brand was officially launched, and launched the Taobao store, and in August of the same year, it landed on Tmall and entered the beauty e-commerce field.
At that time, the status quo of the industry was that overseas first-line brands encroached on the domestic market, and brands such as the veteran domestic brands Baijiling, The Membrane Law Family and The Royal Mud Fang where Huang Jinfeng had worked firmly grasped the minds of online users, and the days of perfect diaries were not good. In 2018, seeing that the traffic dividend was exhausted, in addition to taking the cost performance as a selling point, Huang Jinfeng set his sights on social e-commerce, perfect diary began to put a large number of investments in Xiaohongshu and Douyin, and invited big-name stars and a brother with goods Li Jiaqi to help, and the marketing firepower was full.
The opportunity was thus seized by the perfect diary. In the 2018 Tmall Double 11, Perfect Diary exceeded 100 million sales in only 90 minutes, becoming a super dark horse in the beauty industry that year, and then opened an explosive growth. In 2019, Perfect Diary became the first domestic brand in history to top the Tmall Double Eleven makeup list. That year, a survey conducted by Tmall showed that Perfect Diary was the second most favorite domestic brand of the 00s, second only to the first place Huawei.
Today, the story of Perfect Diary has just passed 3 years, but it has become a typical representative of the "light of domestic products". According to the prospectus, in the first three quarters of this year, the total net income of Yixian E-commerce was 3.2716 billion yuan (US$481.9 million), with a loss of 1.16 billion yuan. To achieve such a revenue scale, the leading enterprises in the domestic beauty industry usually need more than ten years.
Innovative social marketing occupies the minds of Gen Z consumers, provides the ultimate cost performance and rapid iteration of high-quality new products, are the two magic weapons for the outside world to summarize the phenomenon-level growth of perfect diaries. For example, in terms of social marketing, the number of kols in Perfect Diary is as high as 15,000, of which more than 800 are kols with millions of fans.
Only 4 years after its establishment, Yixian E-commerce successfully went to the United States tonight to ring the bell, with a market value of 7 billion US dollars. According to the latest prospectus, after the IPO, Huang Jinfeng's shareholding ratio is 25.3%, according to which the 37-year-old Huang Jinfeng's net worth reached 1.77 billion US dollars (11.2 billion yuan) after the listing of Perfect Diary.
Behind the well-known vc/pe gathered
Early investors recalled: signed ts in less than half an hour
This is undoubtedly a phenomenon-level growth case in the venture capital circle.
Founded for 4 years, the well-known VC/PE behind Yixian e-commerce gathered. According to incomplete statistics from the investment community, perfect diary investors have brought together many well-known investment institutions such as Zhen Fund, Hony Venture Capital, Hillhouse Venture Capital, Gaorong Capital, cmc Capital, Boyu Capital, Tiger Global Fund, Warburg Pincus Investment, Carlyle Investment, Andyn Valley Capital.
Looking back at the initial financing of Perfect Diary, in August 2016, Huang Jinfeng sent a WeChat message to Fang Aizhi, founding partner and CEO of Zhen Fund: I am ready to start a business. Liu Yuan, managing director of Fang Aizhi and Zhen Fund in Shenzhen, immediately asked him to meet in a hotel lobby, "I was 9 months pregnant at that time, and Perfect Diary was the last project I saw before giving birth." Fang Aizhi recalled to the investment community.
The two sides talked for an hour or two at that meeting. After the meeting, Huang Jinfeng officially sent bp to the Zhen Fund, and 15 minutes later, Fang Aizhi sent him ts. In 2017, Zhen Fund increased its stake again, and then participated in two more investments.
"Liu Yuan and I have a very good impression of the team of Perfect Diary, Zhen Ge has always been based on investors, and the team of Perfect Diary belongs to what we will definitely vote for." Fang Aizhi said, "Jinfeng has work experience in Procter & Gamble and Yu Ni Fang, and has been working in the beauty and skin care industry for many years. The other two partners, Yuwen and Jianhua, have rich practical experience in e-commerce and FMCG, and the three of them are alumni of Sun Yat-sen University and are familiar with each other. In our opinion, it is a good combination. ”
Such words of praise, Huang Jinfeng and his team must have heard a lot. Wang Tianshi, managing partner of Hony Venture Capital, is also an early investor in Perfect Diary, describing Huang Jinfeng in his words, "He is an entrepreneur who is sensitive to business opportunities, has strategic thinking, and has strong execution ability, with both local entrepreneurial experience and international vision." Wang Tianshi and Huang Jinfeng are classmates at Harvard Business School and recognize and understand each other.
In the second half of 2017, Hony Venture Capital made a quick decision and led the Series A financing of Perfect Diary. Recalling the scene at that time, Wang Tianshi admitted to the investment community that in fact, the data performance of Perfect Diary was still "before dawn", but they were still very sure about this investment. In 2020, Hony continued to increase the Perfect Diary e-round financing.
Wang Tianshi attributed the investment perfect diary to three factors: "First, China's makeup consumption is young and the online penetration rate continues to accelerate, the online growth rate of makeup has reached 100%, and the beauty market ceiling is very high. Second, we highly agree with Perfect Diary's data-driven, consumer-centric philosophy in its business model. In the end, 'people' is the most impressive decision-making factor, founder Huang Jinfeng is very keen on consumer needs and business opportunities insights, while strong execution, but also has the ability to pattern and organize. ”
On Double Eleven in 2018, Perfect Diary became the dark horse of the beauty industry, and Wang Tianshi also participated in this marketing as an investor that year. He is still impressed, "I was the only investor who was with them at that time. In 2017, the double eleven did a general, 2018 felt as if it had mastered some skills, when the data came out, soon the sales exceeded 100 million, and everyone was very excited. After the revelry, Wang Tianshi and Huang Jinfeng went downstairs to eat a bowl of intestinal powder and went back to fight.
(Singles' Day 2018)
Hillhouse invested 5 consecutive rounds, "new shareholders came in with robbery"
Why did they throw in the perfect diary
In fact, the financing process of Yixian e-commerce has also had an "empty window period". Just after Zhen Fund and Hony Venture Capital, until the middle of 2018, a number of investment institutions have been exposed to Perfect Diary, but no one has ever taken action. At that time, VCs had concerns: the makeup market capacity ceiling was limited, and the online repurchase rate and loyalty were not high.
However, Hillhouse Venture Capital made a decisive move. In May 2018, Dai Yuexiang, managing director of Hillhouse Ventures, met Huang Jinfeng for the first time, chatted for less than an hour, and firmly expressed his investment intention and successfully invested in its A+ round.
At that time, Hillhouse's research team had been dormant in the beauty track for many years, and in the secondary market, Hillhouse had studied many overseas beauty giants and was quite familiar with the dynamics of China's beauty industry. On the other hand, they clearly see the rise of the new crowd: the young generation of Chinese consumers has a heartfelt recognition of domestic brands and the pursuit of the ultimate cost-effective products. How to innovatively meet their new needs, there is a huge amount of room for imagination.
At the same time, Yixian e-commerce has also ushered in Gaorong Capital. At that time, Perfect Diary was still on the eve of the brand outbreak, but even so, Han Rui, a partner of Gaorong Capital, saw a very different team - looking at the top of the mountain, finding friends, stepping on the right path, resisting temptation, and having a strong iterative ability.
Han Rui often communicates with Huang Jinfeng on the phone in the early morning, "The deepest impression is that he always looks back at himself from the time dimension of 3-5 years to see if today's choices are in line with the values and long-term interests of the company's bottom." The company emphasizes right and wrong, not on difficulty, which is gratifying. ”
Since 2018, Hillhouse Venture Capital has invested in Yixian E-commerce for five consecutive rounds, and is its largest external institutional shareholder. In the 2019 C round of financing, Hillhouse is the leading investor, that is, from this round, the competition among investors has been very fierce - "new shareholders come in and grab." ”
In the C round, cmc Capital became the only new shareholder of Yixian E-commerce, and continued to participate in the company's D and e rounds of financing since then. "Cmc Capital began to conduct systematic research on the industry in 2018, noting that Perfect Diary is growing rapidly, and after Double Eleven in 2018, the stage and scale of Perfect Diary entered the range of CMC Capital's investment, and we have been in contact since then." Chen Xian, partner and chief investment officer of CMC Capital, told the investment community.
Subsequently, Boyu Capital, Tiger Global Fund, Warburg Pincus Investment, Carlyle Investment Group, and Zhengxin Valley Innovation Capital also entered the game. Today, in the prospectus, Hillhouse Venture Capital, Zhen Fund and Gaorong Capital are still the three major external investors of Yixian E-commerce, and the shareholding ratio after the IPO has reached 12.6%, 9.5% and 8.4% respectively.
Hillhouse founder and CEO Zhang Lei commented, "In the short 4 years since its establishment, With the most accurate insight and innovative grasp of user needs, as well as with strong product research and development and data drive, Hillhouse E-commerce has not only created a beauty brand that is deeply rooted in the hearts of the people, but also established a new beauty platform for the future. ”
The spring of domestic beauty has just begun
"China will definitely give birth to its own L'Oréal"
Behind the successful IPO of Yixian e-commerce is the collective rise of domestic makeup.
In 2019, China overtook the United States to become the world's largest beauty market, with total sales of about 349 billion yuan, an annual growth rate of more than 20% in the past three years. It is expected that China's beauty market will continue to maintain rapid growth in the future, and sales are expected to reach 676 billion yuan in 2026.
Today, the consumer population has changed. As Zhengxingu Capital believes, China's economic structure is undergoing tremendous changes, and the proportion of consumption in GDP will increase rapidly. From the demand side, the new consumer groups represented by the post-90s and post-00s have gradually become the main force of consumption, and the acceptance of domestic beauty brands by young people is getting higher and higher, no longer blindly pursuing big brands in the traditional sense, forming their own brand aesthetics and cognition, and promoting the rise of local brands.
Wei Zhen, co-president of Warburg Pincus Investment China, told the investment community: "Brands such as Perfect Diary under Yixian E-commerce are prominent representatives of the rapid rise of domestic beauty brands, and are also the direct beneficiaries of the general trend of Chinese consumers' acceptance of young and personalized domestic brands. ”
Han Rui believes that Chinese beauty brands are experiencing an unprecedented window that can truly communicate with consumers in both directions, and online tools and social tools allow brands to truly have consumers, which was even unimaginable in the past.
This year's double 11, the cumulative sales of Perfect Diary exceeded 600 million yuan, ranking first in the Tmall makeup category. Yixian E-commerce, which sells crowns + capital darlings and has a halo of "light of domestic goods" on its head, is also comprehensively promoting its multi-brand strategy - in June 2019, Perfect Diary acquired the tide play makeup "Little Odin", and officially released its strategic new brand Completed In June.
Not long ago, Yixian E-commerce and one of the largest dermatology and care groups in Europe - the French pierre fabre Group reached an agreement to acquire its high-end beauty brand galénic, and domestic cosmetics began to plan to go international. However, at the media communication meeting on the day of the listing, Perfect Diary said that the focus of the next few years will still be the domestic market, and strive to become the largest beauty group in China as soon as possible, and then focus on promoting internationalization.
"Global platform beauty companies such as L'Oréal are becoming bigger and bigger through mergers and acquisitions." Some investors think so. Today, Perfect Diary rings the bell with the spending power of a new generation of young people, and the spring of domestic cosmetics has just begun.
Just like the last day of 2019, at the Hokkaido II Ancient Snow Field at an altitude of more than 1,300 meters, Zhang Lei said to Huang Jinfeng: China will definitely have the opportunity to give birth to a new L'Oréal.