In 188bet article, Mr. Gao Xiang analyzes several major reasons for entrepreneurial failure，combined with the situation of the invested enterprise，In the team、Valuation、Business Plan、A lot of sincere suggestions were given from the four aspects of the roadshow。188bet article comes from Mr. Gao Xiang’s speech at the Chaos Entrepreneurship Camp’s “Innovation Leveraging Capital” forum。

Mr. Gao Xiang is the founding partner of Gaorong Capital，Focus on investment in TMT field。Before 188bet，He works for IDG Capital，Serves as a partner and member of the investment decision-making committee。Projects invested and managed include potatoes、91 Assistant、3G Portal、Dota Legend、爱屋吉屋, etc.。

1. Fundamental reasons for entrepreneurial failure

Every time people mention the cold winter, they have very negative emotions，I think everyone doesn’t need to look at it 188bet way。Because the entrepreneurial winter usually occurs every 3 to 5 years，It emerged with the subsidence of the capital boom。

For many startups，Economic winter is often also a source of future opportunities。The capital winter is never the reason for entrepreneurial failure。So what is the root cause of entrepreneurial failure？The team’s own flaws are the root cause of entrepreneurial failure。

Five reasons why startups get into trouble：

The first reason: giving up what 188bet are best at，Move to something bigger or more right。

I am also surprised by 188bet，But in the companies I invested in that were in trouble，More than half of companies make 188bet mistake。

In 2007, I invested in a social networking site similar to Facebook，188bet company is very good at social games，The Southern School was basically occupied in less than half a year。About three or four months later，They come to me，Tell me the development process of Facebook in detail，Look，After Facebook experienced rapid growth，Entered a growth bottleneck for about half a year，When will it grow again？When they launched the Facebook open platform。So we want to become a website like Facebook，Must also build an open platform。That’s right when I think about it，Just do it。

So the company’s main focus was on the open platform development project team。But the fact is half a year later，The open platform has not been developed yet。Opening a platform is a very difficult thing to do，Far beyond the capabilities of 188bet team at the time，Although they want to be an open platform，Made a lot of efforts，But it is a small company after all，There are very few resources available。And at the same time，Renren uses a very simple method，Basically occupied all channels。

The case above，To put it simply, it means "beyond our capabilities"。Entrepreneurs must always ask themselves 188bet question，What is our strongest ability？Have we made it the strongest in the industry。

When your strongest ability can still make the company develop rapidly，Never change your rhythm and strategy casually。

Only when your abilities have been maximized，When 188bet find it difficult to grow，188bet should look for a new direction，Or exercise your new abilities。

The second reason: only big goals，No specific breakdown，And most of the time, 188bet big goal cannot be achieved。

I have invested in a company before。188bet company sent me a 10-page annual plan one year to launch an important new product next year，It’s full of teams、Product、Market、General description related to promotion，Only the last page has numbers，It is said that the new product is planned to be launched in the second quarter，Plan to reach 5 million users throughout the year，500,000 daily users，Becoming China’s biggest something。

Obviously not done in the second year，But I summarized the reasons in very simple language，Due to market、Team、Funding and other reasons，As a result, 188bet annual plan was not completed。Then we will make such improvements 188bet year，Preparing to reach 10 million users by the end of the year，Still only one big goal，No decomposition。Third year，They no longer need to make annual plans。

188bet case is a very extreme case，Because 188bet situation actually occurs in many entrepreneurial teams，It’s just different degrees。

Why should we break down a big goal?

1） 、The process of rethinking，Go through the process yourself，188bet is possible to find many problems。

2）、Do a good job in division of labor，Let everyone know what they have to do。Team execution with goal decomposition and team execution without goal decomposition，188bet’s all different。

3） 、Basis for post-event summary，Only decomposed goals have the value of summary。

The third reason: only focusing on users and not on finances.

Every entrepreneur can think about it，What is your company’s cash balance，How much do 188bet spend every month，What is the relationship between your user growth and costs。

Every entrepreneur I see will ask him this question，From my actual results，More than 60% of entrepreneurs cannot answer this question，Of course there are only a few people who don’t know the answer at all。Most of the time I say，Wait a moment，Let me ask about my finances。In other words，188bet may not have taken it to heart when Finance told 188bet，Only a rough impression，And this impression is probably delayed。

Startups should have at least 9 months of cash reserves at all times，And 188bet are at this point in time，188bet must think about it，If six months are deducted，What should I do when I only have three months of money。

The fourth reason: the speed is too slow.

There are many reasons why the speed is too slow，For example, insufficient execution。There are two situations that I think can be relatively avoided in a too slow environment。A kind of perfectionism，Always in beta。The second type is called excessive dependence on external resources，Time is uncontrollable。

There is a small way to help 188bet test: find a friend who is an investor，Send him a message every month to talk about your latest progress，Let’s see how he reacts。If he doesn’t answer，Or reply with two smiley faces，Basically it means your progress is a bit slow。If he interacts with 188bet a lot，It means your progress is good。

The fifth reason: working behind closed doors and refusing to communicate.

Time for company strategic transformation，High-quality communication is very necessary。A company I met before that is facing transformation，We spent about a month or two discussing what should be done，But there is no conclusion yet，At that time, the company only had three or four months of money left in its account，So we faced a big difficulty at that time。

Finally we did one thing，Gather together the CEOs of other companies that we had invested in at that time，Have a brainstorming session with him，That exchange was indeed very effective，I have figured out many of the problems that we were struggling with before，So their transformation was very successful，From a loss-making company to 30 million in the second year。

And today’s entrepreneurship is increasingly difficult to do alone，Ten years ago, if 188bet started a business alone, it was OK，Because in that era，Winning or losing is entirely determined by the quality of the product。

2. Common sense errors regarding valuation

The most frequently asked question in financing is valuation。In the past, I have seen many entrepreneurs make common sense mistakes in valuation，I will summarize three points here:

The first point: write sky-high prices in the 188bet.

The business plan is a material that makes investors willing to meet with 188bet。Many times we may feel interested and want to talk about it after reading it，At this time, 188bet are asking for sky-high prices，It’s too far from my psychological expectations，I might not even give 188bet a chance to meet。Everyone always thinks to offer a high price first，Let investors pay back slowly。

But the actual situation may be，There were originally 5 investors interested in 188bet，But because of your high price，Maybe 3 fewer people，There are only 2 people left。5 people are interested in 188bet and 2 people are interested in 188bet，The final investment completion rate is completely different，The more people who are interested in 188bet, the easier it will be for 188bet to complete financing。

Second point: First high and then low is not as good as first low and then high.

There is another situation，188bet opened 100 million US dollars when 188bet came up，Meeted 10 investors，No deal was reached with 10 people。At this time, 188bet tell me to tone it down，Adjust to 70 million US dollars and go meet 10 people。But the investment circle is actually very small，Everyone will know that 188bet once raised a financing with a valuation of US0 million，Not included，Now it’s time to melt again。

Everyone will have various guesses，Why didn’t those people vote for 188bet？So when your valuation keeps falling，Fewer and fewer investors will be interested in 188bet，In the end, 188bet won’t be able to raise money。

So it’s better to say，After initially determining a valuation range，Choose a lower price to finance，Get the maximum number of interests，If everyone is really interested in 188bet during the communication，Your valuation will naturally go up。

The third point: Playing games is a dangerous approach。

Many entrepreneurs will use the relationship between investors to create Game Play，Want to get a better price。Sometimes we go to some entrepreneurial companies，The blackboard was not wiped clean，The name of a certain fund is also written on it，Or when doing a PPT presentation，Inadvertently showing 188bet other VC’s folders。

Because everyone invested in a project，Everyone will make money if this project is successful。If what 188bet say is not very true，I asked on the following WeChat account，If the feedback given by the other party is different from what 188bet said，Then 188bet will face a very embarrassing situation。

3. Related business plans

How to write a 188bet? I would like to share three of my views:

First point: 188bet is best to write the business plan yourself.

Let’s talk about the preparation of business plan from three aspects。A business plan is actually the thing that most truly reflects an entrepreneur’s ideas，So my suggestion is that 188bet is best to write 188bet yourself。

The process of writing a business plan，Actually, 188bet’s the same as what I just said about decomposing goals，In fact, 188bet is your own process of rethinking。And your personal characteristics will be clearly reflected in the business plan。

If 188bet are from a technical background，In your business plan，There may be more descriptions of the technical part，If 188bet are a person with strong market ability，There will be many opinions about the market。

Second point: A good 188bet is actually a story.

Give an example，Two years ago, I accidentally heard an entrepreneur chatting with a friend of mine about starting his own business in a coffee shop in Guangzhou。Because they are friends，So it was very exciting，Why start a business，Then I discovered an opportunity，I was impressed，Later I contacted this person，Said I want to vote for 188bet。But when it comes to the A round，He told me the business plan three or four times，I don’t feel anything at all，I’ll tell 188bet where did your original feeling go？After changing it three or four times, I slowly found the feeling，Finally got the investment。

188bet story actually reflects it，A good business plan is a story told by an entrepreneur。Instead of writing according to the standard template，Follow the investor’s pace，Why not tell your own story，Use your own rhythm to impress others。

The third point: Just explain six simple questions clearly.

Who am I，What do I want to do，Why do we do 188bet，Why am I doing 188bet，How to do it，What kind of company will I be after doing 188bet。Just state these things clearly in your business plan。

4. Related roadshows

When entrepreneurs are on the road show，What should we pay attention to？I share five suggestions:

The first piece of advice: Don’t be stubborn when doing road shows.

The road show is actually a relatively important moment，Because investors basically spend the first hour meeting with entrepreneurs，People will decide if they invest，Should I vote for 188bet or not。

Here are some small mistakes that we often encounter。Start memorizing materials after arriving，No matter what question 188bet ask，He always replies，I have the answer to this question later，Don’t panic。

Road shows like 188bet usually fail，Because the time has come，The questions investors want to know have not been answered。

So everyone should adapt to changes during the road show，Present yourself according to the status of investors。

Second suggestion: Pay attention to investors’ questions，Don’t be defensive。

I often feel that entrepreneurs are very angry，Ask a few more questions and he gets angry。For example, there is a joke，188bet investors always ask questions，What would 188bet do if BAT started this business？What about investing in BAT，What do 188bet think？Actually，We don’t ask this question to get a definite answer。We ask this question just to know if 188bet have considered this matter，Are 188bet thoughtful about what 188bet do。

We use these questions to judge your ability，Because investing means investing in people。All our problems depend largely on people’s reactions，Your reaction determines my opinion of 188bet。So everyone must pay attention to investors’ questions，Don’t be defensive。

The third suggestion: don’t use too many techniques，Simplicity and effectiveness are the most important。

Sometimes we ask how much money 188bet want to raise，This question should be simple enough，80% of entrepreneurs will not answer directly，Some even give 188bet ten minutes of lectures，188bet didn’t hear the final answer either，Actually, I really just want to know how much money 188bet want to raise。

So don’t use any negotiation skills，Communicate with investors，Simple, direct and effective is the best

Fourth suggestion: Lies and lies must always be paid back.

Sometimes，The entrepreneur does not mean to tell lies，But as 188bet say it, it becomes a lie。So in the process of communicating with investors，Always stay true to yourself and your investors。

Fifth tip: Read investor feedback.

Many times，Let’s meet ten or eight investors，Everyone said 188bet was good after coming back，There may only be two left who really see each other again。Everyone must read investor feedback。

The first one is called keep in touch。188bet are good，Very good，Let’s keep in touch。This is basically equivalent to rejection。

The second one is also to keep in touch，But subsequent investors will take the initiative to ask 188bet about your progress，For example, after a month he will send a WeChat message saying how it is going。

The third type，We will start arranging various meetings immediately。As 188bet can see, there are basically three kinds of replies，The fourth possibility is to reject 188bet directly on the spot。

After understanding the feedback from investors，Only 188bet know how to formulate the next strategy。If many people are interested in 188bet，188bet may want to be more aggressive，If not many people are interested，188bet have to be more conservative。

Last，Actually speaking simply，The best way to communicate，Just treat investors as good friends，Communicate sincerely and emotionally。Just like the example I mentioned above of meeting good entrepreneurs in a coffee shop，In fact, that is the most efficient way。

*188bet article is reproduced from Chaos Research Society (WeChat official account: dfscx2014)。