Li Xiao from Joy Capital: "Three tips" must-see for A-round startups

Industrial Investment Author of 188bet app article: Li Xiao 2017-06-06
Facing an uncertain environment,How startups should develop strategies?How startups create unique value?188bet app Series A financing,What are the most important things that startup companies need to do?Li Xiao, founding partner of Joy Capital, gave his advice。

All the success lessons summarized are hindsight,For example,Even if 188bet app can really have the "Baidu technology + Tencent products + Alibaba operations" that everyone is talking about,188bet app may not necessarily succeed。Therefore,What startups should do is not blindly apply other people’s success formulas,According to your actual situation,Explore a path that suits 188bet app。

I saw 6 sure ways to die

First,The Internet is a very uncertain world,Let’s first review the so-called “trends” 188bet app past few years:

The most popular models in 2011-2012 are,Mobile distribution、Social、Group purchase、E-commerce, etc.。

A large wave of game companies emerged in 2013,Enjoyed the first wave of mobile Internet 188bet app model realization dividends。

2014-2015,Various hot concepts emerge in endlessly,Including picture social、O2O、B2B、Internet finance, etc.,These new models have penetrated into the car、House、Education and other subcategories。

The air outlet keeps changing,Represents the uncertainty of the external environment and 188bet app development,Every outlet,Hot-hot concepts,The vast majority of companies failed to survive,Study these cases,I saw 6 sure ways to die:

1. 188bet app structure.If this is a winner-take-all industry,And there is already a leader,Then the newcomers have little chance。Most entrepreneurs “look up at the stars”,Having lofty ideals,Idealists eager to break through monopoly through technological or model innovation,But in the middle of the game,Tend to ignore the final outcome of the industry、Thinking about the role 188bet app can play。

2. The giant’s radar.Companies including BAT are very aggressive in deploying in various fields,So when 188bet app choose the direction,Be sure to avoid being in the field that the giants are determined to do,Encounter with the giants,Funds、data、Start-up companies with no resource advantages actually have a low chance of “counterattack”。

3. Rapid expansion before the model is verified.Most companies died after the A round because of this,Because after the A round,The goal of the team and investors is growth。But if the growth mainly comes from subsidies or marketing,188bet app is actually impossible to analyze whether this growth really comes from the high quality and healthy model itself。

4. The 188bet app competition is too fierce.In recent years, many fields have rapidly entered a fierce competition,Example: used car,Auto after-sales service, etc.。Leading companies have received staggering amounts of financing。Although 188bet app method is relatively simple and crude,But in a short time,Several leading companies came out,188bet app also forms extremely high barriers through capital。

5. The infrastructure is too poor.A startup should not try to change the infrastructure,But to gain insight、Adapt to infrastructure changes,And take advantage of these changes to serve your own business。For example: 188bet app was very difficult to get a cash loan 3 years ago,Because of mobile payment,Big data,The credit system is not perfect yet。Some people have been doing QR codes for a long time,Hard to push,188bet app wasn’t until the WeChat scan function that we started to develop rapidly。

6. Try to challenge the characteristics of the 188bet app itself.For example: each game has its own life cycle,Big movie production does not mean high box office,Many entrepreneurial companies fail because they do not have a deep understanding of the characteristics of the 188bet app。

Under 188bet app ever-present uncertainty,The Winner actually has four ways to live:

1、Seize the time window,Rapid 188bet app,Form user base and barriers,Often can eventually form a huge network effect and a strong communication effect。For example: Snapchat has seized the short window of transition between the Internet and the mobile Internet,At that time Facebook’s mobile messaging was not very powerful,Snapchat pass is small、But the very sharp function breaks through quickly,Finally formed its own barrier before the giants entered。

2. Do things that others cannot understand.If everyone understands it, they will do it,It means 188bet app will face fierce competition at the beginning of your business;Because no one understands it,If 188bet app do it at this time, 188bet app may gain an advantage。

3、in vertical、In an industry with heavy offline attributes,Do more dirty work,What others can’t do、Or work 188bet app don’t want to do,This kind of company often does not develop so brightly in the early stage,As long as 188bet app can hold on, 188bet app can build barriers that are difficult to overcome。

4. Completely new products + different markets.DJI is a good case,Drones used to be a very niche product,Users are all good at model airplanes,If DJI only does China,The market space is not large。But,DJI changed its mind,Start from the consumer side,And because 188bet app leads the world in products and technology,Finally reached the global market。

Secondly,Facing an uncertain environment,How startups develop strategies to survive?

The strategic planning idea of ​​traditional companies is,Carry out analysis and prediction of strategic environment first、Set goals and quantify them,Then determine strategic priorities、Develop an action plan、Dividing stages,Reimplement strategic measures,Final submission of written plan 188bet app winning proposal for review and approval。

But,Start-ups face an unknown environment,A user group that cannot be accurately defined,Their strategy is not imagined,Being "forced out" and "beaten out"。For example,Why Alibaba does Alipay and Tmall?How Tencent found its own 188bet app model?Did Xinmei University think of opening hotels and takeaways in 2011??

Therefore,The biggest challenge for startups is facing an uncertain market and environment,The biggest opportunity is that there are infinite possibilities。In an uncertain environment,The strategy of a startup company can only be: either be the first,Either be different。In the final analysis,Stay flexible,Always be prepared for “change”,Evolve and maintain your edge in a dynamic environment—or else, The first one may be surpassed,Being different may make 188bet app lose sight of everyone。

The most core one,It is to make "real" differentiation。Whether it is the e-commerce supply chain system or customer experience,Whether 188bet app are starting from the B-side or C-side of the industry chain,Not even the other homes 188bet app provided、Your "differentiation" must be what customers value most。

Last,When 188bet app design your business model,The two most important ones are: how to achieve true differentiation and the general direction cannot be changed。Then,188bet app can carefully observe the dynamics around 188bet app,Quick iteration、Feedback、Make adjustments。In my opinion,Startups are mainly qualitative、Process Oriented、Enjoy the process。

What is your unique value?

For startups,What kind of things have unique value?

1. Unparalleled products or experiences that are just needed.
2. Subversive cost structure changes.

Then,How to create unique value?Generally including brands、Technology、Patent、Network Effect、Cost、Experience and other elements。The following are the main examples:

1) Airbnb: an unparalleled experience。Airbnb does not provide a typical high-frequency service、The price is not cheap either,But it uses brand and experience,Many users will choose it when traveling with their families,Because it brings 188bet app this unparalleled experience。

2) Uber: Greatly changed the supply of transportation,Reshaping the way of transportation。

3) Mobike: Subverting the 1-3km travel method。Suppose I go from home to China World Trade Center for a meeting,Taking a private car costs about 40 yuan per hour,Taking a taxi costs about 30 yuan,Not including the waiting time and the uncertainty of whether 188bet app can get a taxi,If 188bet app ride a Mobike, it only takes about 20 minutes,The cost is only 1 yuan。

4) Today’s headlines: Personalization,Read your heart。188bet app shows different things to everyone,Although AI is so popular today,But Toutiao was doing this a few years ago。

5) Cash loan: cash arrives in 3 minutes。There are many users in China,Traditional financial institutions are not well covered。Now,Cash loan allows 188bet app to not only borrow money,And it arrives instantly。

6) Wework: Reshaping the office industry。Original,Want to have an office,188bet app are looking for a place,Decoration,Buy equipment,Recruitment of front desk administration;Now,Shared office really allows 188bet app to move in with your bags,Subverting the entire office industry with on-demand methods,The cost structure has also changed。

7) WeChat Pay/Alipay: Reshaping China’s payment 188bet app。

8) Takeaway: 188bet app has changed the way Chinese people eat.

Enterprise development must grasp the rhythm

Trilogy of entrepreneurial enterprise development:

The first is the most difficult point of starting a 188bet app: a single point of breakthrough.
The second is the trouble 188bet app the breakthrough: rapid expansion.
The third is the key 188bet app expansion: establishing barriers.

In the first level, the main focus is on the choice of 188bet app model.

1、Track Theory、Can’t believe the rumors。Thousands of success stories,But each has its own splendor。Therefore,Many times,There are many things that cannot be summed up in the success of a company,So don’t believe too many track theories、Trend Theory。Various outlets from 2011 to present,The wind died down 188bet app that,Startup companies have fallen and died,Such examples abound in the past few years。

2、The problem of light assets and heavy assets。In fact, there is no difference in severity,The advantage of being heavy is that your barriers are relatively high、But it costs a lot、Long time;If it is light, it will develop quickly,But it’s easy for others to cut in。Therefore,“Heavy” and “light” are not indicators of whether a pattern is good or bad,When 188bet app want more,188bet app have to think about whether it can stay there for a long time、Survive。

3、The problem of high frequency and low frequency。Everyone wants to do high-frequency business,But this kind of business is rare,So when 188bet app consider high and low frequencies,At the same time, cost needs to be considered、Brand、Price per customer, etc.,Don’t be too limited in your thinking。

Also,When looking for a business model,I think we must pay attention to the infrastructure。Because imperfect infrastructure is an important feature of China’s innovation,188bet app also provides a lot of opportunities for China’s innovation。For example,JD.com’s large-ticket logistics meets the huge demand brought about by China’s underdeveloped basic logistics;Alibaba’s Aliwangwang and Alipay have allowed Alibaba to truly develop C2C and platforms in China;China car rental can develop,188bet app’s because of the credit card、GPS、Second generation ID card、Automatic、Driving license and other objective conditions are in place。

The opportunity for regulation and deregulation is a universal law in new markets。Many innovations in China are due to changes in infrastructure、The emergence of regulation and deregulation,Especially Internet finance、China Logistics, etc.,All are limited by the opening 188bet app market。

Secondly,The rhythm of enterprise development。What everyone needs to pay attention to is user 188bet app、Product Expansion、Commercialization、Changes in organizational structure、Company Culture and Strategy、These points on financing。

Take Linkedin’s four development stages as an example,188bet app was established in 2003,Is the world’s largest business social network,More than 400 million users,2012 IPO,Acquired by Microsoft for US.3 billion in June 2016。

The first stage is from 2003 to 2004: that time,The company does not yet have an organizational structure and strategy,Only 12 early employees,Mainly solve one problem - what products are valuable to users。Subsequently,Product launched in May 2003,Then the five founders began to divide tasks,Everyone must find 100 users。As of the end of 2003,14 employees in the company,7.80,000 users,October 2003 during this period,The company raised US.7 million in Series A financing。And 188bet app will not be until 477 days after the product is launched,Just got the first 1 million users。

The second stage is from 2005 to 2007: the number of users reaches 2 million,188bet app uses an MVP method,Built a highly resilient organization。Then new departments were added,Includes customer service、Sales、Administration, etc.。In 2005, a second, more advanced product was first launched,4.2 million registered users by 2005,Try internationalization later,Starting to explore income models after the number of users continued to increase,Series B financing was also completed at this time。

The third stage is from 2007 to 2008: at 188bet app time, the company has 120 employees,13 million users,The product line has been expanded again,Five research groups support different product lines,Each one is responsible for the income、Growth、Looking for something valuable、Long-term layout, etc.,Introducing a CEO from outside,Improved sales ability。

The fourth stage is from 2009 to 2014: starting to pursue overseas users at 188bet app time,Introducing a new person in charge—overseas CEO,188bet app stage is also a period of substantial growth。

Therefore,In my opinion,The so-called corporate culture of start-ups、Strategic needs,At different stages,They all have different emphases,The CEO should always understand what his urgent and important matters are respectively。

Take the online short-term rental market as an example,Airizu, which expanded rapidly in the early days, has already closed down,After crossing the early gap, Xiaozhu short-term rentals expanded rapidly。Many driving factors for industry development,For example: the quality of the property、Landlord’s awareness、Credit system、Smart door locks, etc.,188bet app are not automatically ready on the first day 188bet app start a business,188bet app have to build a lot of things yourself。This way,Start-ups must grasp the rhythm of development,Do the right thing at the right time。

And in the third level,When 188bet app start thinking about your moat,188bet app must first think about what 188bet app are doing: make a good product if 188bet app make it,To build a platform, 188bet app must establish an ecosystem,Enables everyone on the platform to make profits on it。

Last,To sum 188bet app up,There are five main insights into how entrepreneurial companies can survive:

1) Three stages of entrepreneurial enterprise development: single point burst、Rapid expansion、Building barriers。
2) Single-point sudden change is the difficulty of starting a 188bet app,The most difficult part is to determine the 188bet app model。
3) 188bet app the breakthrough, pay attention to the rhythm of expansion.
4) The market position of a leading company is not necessarily inherently unbreakable。
5) Helping 188bet app make correct decisions at key nodes is the core value of investors。

Growth is the first priority 188bet app Series A financing

The main reasons why startup companies cannot grow 188bet app Series A are:

1) The model has not been fully verified and there is no confidence to expand;
2) Mode is too heavy,Or product retention is too poor,Expansion is not supported;
3) Unable to find channels to acquire customers at low prices;
4) Internal organizational struggle;
5) Quickly enter the devil's channel of competition.

Of course, on the other hand, 188bet app is a double-edged sword:

1、Mode not verified,Rapid 188bet app brings rapid death。
2、When the key driving factors are not ready,188bet app is invalid 188bet app。
3、High-speed growth brought about by massive subsidies or promotions will conceal the true nature 188bet app matter。
4、The growth of front-end requires solid back-end operation system support。There is a saying that "there is thunder in the sky、It’s raining on the ground”,188bet app can do many activities on the client to bring traffic,But the background、Operation、Customers must keep up,Otherwise the traffic is worthless,And this kind of unrealized traffic may even directly cause customers to abandon your product。

Then,How to achieve rapid 188bet app:

1. Good products or content can speak for themselves and spread.Mobike became popular in Shanghai and Beijing as soon as 188bet app was launched,Advertising that didn’t cost a penny,Instead, we made a disruptive product,And this product itself has strong self-propagation properties。

2. Social communication.Any company growing rapidly today、phenomenal company,Basically use social networking to the extreme。

3. Digital operation.Today has entered the era of big data,Excellent 188bet app are all data-driven without exception,Data runs through the entire value chain,Includes traffic analysis,Conversion Funnel,Pricing system,Sales Forecast,Member Management,Supply chain, etc.。

4. Innovative marketing techniques.Especially for online content, good content can bring good traffic.

In my opinion, we should pay attention to the following four things 188bet app the A round:

1. Exploration, optimization and adjustment of 188bet app models.Many startups need to change their business models,Need optimization even if no conversion is required,As we have repeatedly emphasized before - because 188bet app are in an environment full of uncertainty。

2. Build a data operation and analysis system.Because in the early days, I was thinking about issues of life and death,No energy to build data system,But we must pay attention after reaching the A round。Practical proof,Companies that don’t pay attention to data are almost like a blind man trying to figure out the elephant,188bet app don’t even have a complete and accurate understanding of yourself;Also,A complete data system can also better support subsequent financing。

3. Avoid common mistakes 188bet app Series A:

1) Blind expansion;
2) Relax the management 188bet app company’s headcount and cash flow;
3) Internal contradiction;
4) Set unrealistic goals and the team is frustrated;
5) Continue extensive management;
6) direction swing.

4. How to deal with competition.The requirements for CEOs are higher now,There must be a certain strategic height in 188bet app regard,Including how to deal with competition、Choose the right new strategic investor、Choose a partner with resources, etc.,These are all issues that entrepreneurs need to pay attention to。

Last,The company’s journey from start-up to Series A,There are four main points that everyone needs to pay attention to:

1) Strategy of entrepreneurial enterprises: Being No.1 or Different;
2) How to create value: excellent products or services,Disruptive cost structure;
3) Trilogy of Entrepreneurial Enterprise Development: Breakthrough、Expansion、Barrier;
4) 188bet app Series A financing, focus on: growth, model, and data.

*Source of 188bet app article: WeChat public account "Little Dinner Table" (ID: xfz008),Author: Li Xiao,Original title: "Li Xiao from Joy Capital: "Three Tips" a startup company must read if 188bet app reaches Series A


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