Johnson Miscellaneous: Bankruptcy is the beginning of success

At the beginning of the new year, not only the stock market fell sharply, but also the entrepreneurial circle was also in the wind, especially in the o2o field, those door-to-door nail art, foot massage, food and fruit, one by one closed, closed, all the gods, big coffee have come out to comment, pointing out the country. Overnight, what was once an investment hotspot became an investment trap and even an object of ridicule from outsiders. This scene, and fifteen years ago in the Internet industry how similar, around 2000, China has thousands of Internet startups, especially e-commerce companies have collapsed, but also a group of high-ranking people out, have commented: what b2c is not ok, e-commerce is a scammer, who dares to pay online? Buying a can of Coke can be delivered, how can the logistics company make money? Wait a minute. It is true that many companies have gone out of business, and indeed many entrepreneurs have chosen to give up under the influence of high people. The next fifteen years did prove that the direction chosen by most people at that time was correct, and the reason for the failure was that the business ecology was not perfect, such as payment and logistics were in a very low-level stage, and a good socialized division of labor had not yet been formed in the new economic field; second, the capital chain was broken, and there was not enough funds to support the company's continued development in the case of loss; third, there was no excellent team with firm conviction and strong execution.

Let's start with the issue of business ecology and division of labor, many of the things that were questioned fifteen years ago are now so simple. Some time ago, a large farmer's market near my house was all moved, my father complained, some things can not be bought, I said to buy online, he said that there are many leaves in the yard, he wants to buy two bamboo brooms, sweep leaves, it is also a dozen dollars a hand, can you buy online? So I opened Taobao when his noodles, all kinds of styles are available, it is more than ten yuan, I bought two, three days later it arrived. This shows that even such a low value-added product still has room for profitability, which was impossible fifteen years ago, and more than ten yuan cannot even cover the cost of logistics. This reminds me of Adam. Smith talked about the social division of labor in "The Wealth of Nations", making a pencil, it takes more than 20 processes, but only need to sell a few cents, if all the processes have a company to do, it must be a loss-making business. Today, a large number of o2o startups, such as community o2o, vegetable and fruit supply chain, automotive aftermarket, and so on. The dilemma they face is not that the direction is wrong, but that the social division of labor in this field is not yet mature, or the entrepreneurial team does not think about the business model from this perspective, resulting in the inability to design profit forecasts, and it is not clear that the scale without efficiency cannot be long-lasting. Take the community o2o, the business operation around the community and the distribution within one kilometer should be the cause of the property company, the marginal cost of the property to do these things is almost zero, and if the Internet company to do, the cost will be large, definitely lose money, the problem now is that the property company has a strong will, but there is no ability, this is like the payment and logistics of the year, it takes time to promote and improve. I recently practiced Tai Chi, I feel that the thinking of Tai Chi and the thinking of the Internet are somewhat similar, Tai Chi Chuan advocates borrowing the power of the other party to react to each other, in fact, the Internet thinking also contains the concept of using idle resources to serve the public, such as Didi Chauffeur, Ctrip, etc., are typical cases of using each other's resources and serving each other.

Talking about the problem of funds, it is very interesting, now it is completely different from fifteen years ago, when almost no domestic capital entered the field of venture capital, and now all kinds of funds are squeezing into the field of innovation and entrepreneurship, so just like the job market, everywhere is recruiting, there are people everywhere who can't find jobs, now there are funds everywhere, there is no money everywhere. To sum up, many startups actually do not think deeply about the nature of some business, I once asked several startup CEOs to make a simple table with excel, to see how long it takes, under what conditions the company can reach the break-even point, although it is only a hypothesis, or a story, but if you can't find that intersection, who dares to invest in you? Unless you've ever had a successful startup, maybe based on trust, someone is willing to invest. Recently we invested in a company that does automotive after-sales services, although successfully got three rounds of investment, but continue to finance faces great challenges, we have combed, carefully considered the factors of social division of labor, studied the nature of business, and finally made adjustments, now tens of millions of funds are waiting to be invested.

Finally, talk about the team, in fact, this is the most important factor for success, a good team, with lofty ambitions, firm beliefs, super execution, especially adjusted execution. Take the radius of the community we invested in, the past year of the team, it can be said that it is a year of tossing, I said to the boss of the property company we worked with, you are the sheep in Zhao Benshan's sketch, we have been on you to learn wool, and finally we have come up with something. We want to do e-commerce around the community to think about how to establish a new community civilization, we from subsidies everywhere, send people to expand to the achievement of property companies, promote property companies to become community service operators, I saw the team's enthusiasm for the cause, the understanding of the nature of business, I know that they will definitely win.

In fact, the current wave of startup closures is not unusual, it is a normal process of big waves, irrational competition is less, it will restore the original face of business, setbacks let people start to think deeper, those really excellent companies will stand out, from this point of view, the closure may be the beginning of success.