Xiao Min, a 2018 student of Chaos Entrepreneurship Camp, won the heaviest "Shackleton Award" in the 2-day 56-kilometer Gobi hike of Chaos Entrepreneurship Camp, which is to commemorate the explorer Shackleton a hundred years ago.
He was a very optimistic and determined man, and when he was at the Gobi scene, he joked:
"We didn't have a champion, but we took the first place for the new students of the startup camp."
"We turned six people into one."
He is mainly responsible for the field of industrial Internet, including b2b/trading platform, industrial Internet, enterprise software, etc., and also sees the sea project. Focusing on digitalization, industrial upgrading and efficiency improvement, star companies include Futu Securities, Xingyun Group, kk Group, Lexin, Yidian Cloud, Zhibu Internet, Harvest, V Doctor, Global Knight Card, mollybox, Red Brinpling Plump and so on.
Recently, he has shared some views from investment thinking, personal feelings, cognitive reflection and other aspects. Jingwei's friend recommended this conversation to Chaos Jun, hoping to cause some thoughts from chaos academy readers.
Many of the sentences in the text are intriguing, and Chaos Jun has picked some out:
To do pe is to find the answer in a bunch of numbers, and to do vc is to find Mars in a pile of ashes.
Most of the time, investors do not point out the business, but inspire entrepreneurs, and what they need is a flash of inspiration in the discussion.
The fact that the founders themselves injected money is a plus for us investors, and it proves that the founders really believe in this matter, not speculate.
I feel that sincere, direct communication is the most efficient, I have made investments for so many years, and I have always felt that I am doing Party B.
I like people who are smart and a little proud, or more demanding or even a little demanding.
……
The following is the text:
Share by | Xiao Min, Partner of Matrix Partners, Chaos Entrepreneurship Camp 2018 students
Source | Jingwei Venture Capital Chaos Jun slightly deleted
Q: Think for a second, which company will come to mind right in front of your eyes? Can you briefly introduce this company?
Xiao Min: One second is too short, and all of a sudden I think of Futu, Futu, which we invested in in 2014 and went public in 2018, which helps the securities market, and it itself is also worthy of affirmation in the business model, and there are many innovations. Founder Li Hua I have known for a long time, he was originally a product manager of Tencent, he hopes that there is a good securities trading software can solve the current pain points, think it is a big opportunity.
But driving well does not mean that building a car must also be successful, at that time there was no such company in the market, an Internet person, to do a very financial thing, whether the water is deep or shallow, these have yet to be explored, so we have eaten back and forth for a year. By 2014, his team had financial people who had joined the brokerage, no longer a pure Internet team, but also ready to win the relevant licenses in Hong Kong, in the process, Li Hua himself also advanced tens of millions of dollars in. At this stage of development, we decided to invest in it to help him grow his business.
In fact, the fact that the founders themselves injected funds is a plus for us investors, which proves that the founders really believe in this matter, not speculate. Of course, there must be a degree here, and you can't say that in order to start a business, let your family be in an unsafe, stormy situation, which can't last long.
Later, Futu is beyond expectations, for example, they will have an expectation when they issue a financial report at the beginning of the year, but in the middle of the year, they may raise the whole year, and most of the companies in good shape are like this.
Q: Is your investment strategy more focused on one industry, or is it a cross-cutting approach to several industries? In what direction have you spent the most time lately?
Xiao Min: For a long time, I have been very interested in model innovation, and I prefer to look at trading platform companies. To study this type of company, you may jump into a lot of different industries, which may not seem very focused, but the essence of these companies, when you understand the business, is actually the same.
Recently, I have spent more time in the field of industrial Internet, that is, how to use various technologies to improve the efficiency of traditional manufacturing, and the simple summary is to increase efficiency, reduce costs, improve quality, environmental protection, and safety.
Q: Recently, more and more people have paid attention to the industrial Internet, you began to study the industrial Internet very early, how do you think about this market?
Xiao Min: There are many potential opportunities for the industrial Internet. From a very macro point of view, a commodity needs to go through three major links, from the initial place of origin/factory, to the intermediate place of sale (including various trading platforms), and then to the final consumer end. We have been focusing on the consumer Internet for a long time, in fact, only the last link is covered, and in the first two major links, there are still huge opportunities, which is the industrial Internet.
Therefore, the industrial Internet contains two major components, the place of origin /factory and the place of sale/supply chain. In the origin / factory link, it is also an opportunity for the industrial Internet, it mainly through three aspects to solve the efficiency problem, the first is "people", because today many industries can not recruit the right people, or use people to do some problems; the second is "equipment", a lot of old equipment is not networked, can not accumulate data, but now data is also very important for efficiency; the third is "production" related, it involves technology, raw materials, logistics, security and so on. Each of these sub-sectors is worth upgrading. In terms of sales/supply chain, in fact, the solution is the circulation matter, that is, warehouse, distribution, finance and so on.
Jingwei has a lot of layout in the industrial Internet, such as the industrial Internet of Things companies that do industrial equipment digitalization, the cloud factory smart cloth interconnection that improves the efficiency of the textile industry, the industrial product b2b e-commerce Zhenkun line, the cross-border consumer goods B2b platform cloud global exchange, etc., these companies have certain model innovation, but also in their respective fields to improve the efficiency of the industry. We have been seriously looking at opportunities in this field for a long time and will continue to lay out.
Q: How do you generally deal with founders? What is your style when you want to make an investment?
Xiao Min: I am generally a more direct style, when we reach a consensus that this thing can be done, I will say that if I want to vote, let's see what obstacles there are in the middle, what ideas do you have, we sort out one, two, three, I will say this can, that is my bottom line.
I think sincere, direct communication is the most efficient, I have made investments for so many years, I have always felt that I am actually doing Party B. Everyone first rushed to talk about this matter, and then it was clear what problems still existed and could be solved. If the difference is too great, let's see if there are any other options.
It is also important that we understand each other's demands. Every founder raises money every time, in fact, there are different demands, and we need to have the ability to think differently. The relationship between investors and entrepreneurs should be like friends and business partners, most of the time standing on one front, but occasionally there will be opposites, so we must first reach a consensus or tacit understanding between us. Especially early investment, go to the back, you will find that you and the founder are in a trench, your early money is to help him to do a rapid growth, if your goals are the same, but also mutual achievements.
Good founders are very clear in their hearts what kind of money they want, and what they don't want. So before we actually sit down and talk together, the preparations are also important. Founders definitely like to stand with an investor who understands the business better and is easier to deal with, rather than looking at you and thinking that you are just a person who gives money in stages and then wants to get practical benefits from his side.
q: How to quickly judge a person? When do you feel that you have feelings for judging human nature?
Xiao Min: I think this depends on a little talent and more accumulation. I've summarized a set of methods that, while not entirely dependent on, can give us some basic coordinates in most cases.
First of all, I will pay special attention to the growth experience. For example, if you have been in a big factory for many years, then there is no change in the title, whether the things in management have changed, and the excellent person will be excellent everywhere, and he will have his own rhythm, just like the tree will grow every year. I think excellence is an attitude, a habit, not a sudden appearance because of changes in the external environment.
The second is to look at some of the key choices to think about. Because we're investment entrepreneurs, not artists, you need someone who is logical and market-sharp, not someone who makes a lot of emotional decisions every day.
The third is to see how a person treats the people around him. For example, several people sit together, who chats, who doesn't chat much, how to introduce his colleagues or friends. Because good people will always say that other people are good, they have a lot of respect for their peers, "My team is very good" is the mantra. But in fact, this just proves that the founder is very powerful, although you can command the team, but the founder respects the team, and the team listens to him not because he is the founder, but because the team respects him. This kind of equal cooperation, but also a sense of authority, is the best quality relationship.
From a personality point of view, I like people who are smart and a little proud, or more demanding and even a little demanding. For example, billy (Wang Wei), the founder of Xingyun Global Hui, is a mathematics graduate, and proud people are actually very afraid of being sorry for others, so billy often meets at the beginning of the year to propose goals, very conservative, but in the end the results are very good. I often suggest to him that the goal can be higher at the beginning, but Billy is particularly afraid of disappointing others.
These are all people who have a fire in their hearts, who are very contagious when they talk about their projects, and at that moment they are eager to take out their hearts and put them on the table and slice them for you to see. This enthusiasm is from the heart, and his body may be too tired to do it, but as long as you are seriously discussing the problem, he immediately explains his plan to you like chicken blood, with light in his eyes and fire in his heart.
Q: No one naturally likes risk, what do you think is the risk you can least tolerate?
Xiao Min: There are two main aspects that I can't accept in investment, one is because of my cognitive blind spots, resulting in not seeing some very valuable tracks as soon as possible, and by the time you know, it will be too late to remedy.
The second is that in the track where you already have a certain degree of cognition, you have not invested in the best company, or the best company has appeared in front of you, but you have not recognized it. In fact, investment is, first of all, to see, followed by understanding, and then have to invest in, and finally have to retreat, probably so a few logic, did not see and did not understand are very painful things.
q: How to maintain a stronger presence in the investment industry, with valuations soaring in many tracks and more intense competition? How do you design your playing style for the next 1-3 years?
Xiao Min: The core is still to invest in more valuable things. Because we are investing in the early stages, the best investment is always the best time point when it has not yet been recognized by everyone. At this time, we all need to think about whether we have exceeded the market's cognition, if not, we can only go to the wind outlet, because this is based on the phenomenon to make judgments. But if there is a more cutting-edge understanding, then these things are more worth doing.
In today's complex economic environment, what is still alive in the next five or ten years, and what is in line with Both China's general environment and economic laws, both of which are very important now. From these two points, there are still many tracks or companies that are not so popular, such as in the industrial Internet and agriculture, there are actually many, which will be the general trend in the next 5-10 years.
In addition to maintaining communication with people on the front line of the industry, I also like to look for insight from the policy guidelines, and I will care about what leaders mention at the meeting, including the feelings shared by many industry insiders, analysis articles, etc., which actually represent the top-level thinking and future actions in a certain stage.
q: What is your work rhythm? Do you have particularly anxious times?
Xiao Min: Recently, because of the epidemic, there have been fewer business trips, and I remember that when I was busiest in the past, I often needed to run around in three cities a day, and there was no food at all. I remember when I first invested in Xingyun, because of some issues we discussed for a long time, there were some controversial points, and finally I had an appointment with Billy for an evening conference call, because he was also very busy during that time, and in the evening, although we were physically tired, we talked for hours on end, and finally talked until three in the morning.
At that time, investment in Xingyun was under great pressure, because there was controversy at the time, for example, there was a market view that Xingyun was actually a supply chain finance company, if so, then this business model lacked imagination. I often couldn't sleep during that time, and I wanted to think about these questions. You see my hair is so white, I'm often tortured like this (laughs).
For example, I recently invested in a project, and a very good founder chose Matrix Partners, who started a business in the field of cross-border logistics. This project is because the founder is very good, I talked with him, plus talked with all the relevant partners of Matrix Partners, a total of 6-7 rounds of chat. The most central point to sum up is that our underlying values are consistent, and not only with me, but also with all partners in all relevant fields of Matrix Partners. We talked about the changes in the industry, his future customers, his expectations for development, where we can help and so on, and many other particularly small details, of course, behind these details, there are a lot of complicated and arduous preparations, and in the end our meeting worked very well, and we also believe that this company will bring a lot of real changes to the industry.
Investing in this industry is really hard and full of anxiety, and I haven't taken a vacation for a long time. The most powerful weapon against anxiety is our ability to act. The investment itself is fascinating, we are researching new things every day, discovering new opportunities, and we can do a lot of things to help the company grow, and even help the industry develop, which is a very meaningful thing.
q: In an increasingly "involuted" market, the importance of the team is also being highlighted. When you lead a team, what do you really want to cultivate for young investors?
Xiao Min: I usually carefully tell my colleagues in the team what my standards are, what basic skills need to be done in the early stages, and then I will take them directly to the project as soon as I come up, I think the best way to learn to swim is to learn in the water, everyone jumps into the water, and then practices together.
Because we are in the early stage of casting, the essence is still investing in people, but the cultivation of this ability, first of all, you need to see a lot of powerful people, when you have seen you naturally know what is good. So sometimes when I take young colleagues to meet good founders, I say you have to remember what this person "tastes", remember the look in his eyes when he talks to you, the whole state, although these things are difficult to quantify, but you have to remember this feeling and slowly build your own model.
When a young investor goes on, he needs to grow with the founder gradually. In addition to those business exchanges, you also need to be able to give entrepreneurs a sense of security. For example, if you discuss a thing with me, first of all, I will certainly not say it blindly, and secondly, investors most of the time, instead of pointing out the business, but to inspire entrepreneurs, what is needed is a flash of inspiration in the discussion.
I think that investment is the same as entrepreneurship, in fact, it is also a craft job, and the final fight is talent and understanding. You look at harvard, Berkeley and other famous schools, it can teach you how to do cfo, but it is difficult to really teach you how to start a business. For VC investment is the same, it is a thing between rationality and sensibility, rationality comes from the understanding of business logic, need to be based on some hardcore standards; but on the other hand, just like a good car is not just a machine, it also has to have a beautiful appearance, this is aesthetic, but aesthetic is very personalized, is the resonance between a few people.
When a company ends up doing beautifully, everyone can resonate with it, but in the early days, when it's not perfect, how do you find out. Not everything in this world can be calculated, and there are many accidents outside of computing, and it is precisely these accidents that make a huge difference in the results. To do pe is to find the answer in a bunch of numbers, and to do vc is to find Mars in a pile of ashes.