Xu Xiaoping, founder of ZhenFund, recalled the first time he saw self-media、When internet celebrities and live broadcasts appear，“I was confused all of a sudden。”

Xu Xiaoping is 60 years old this year，He told Caijingtianxia (ID: cjtxzk) reporter，I am very worried about people of my age，When I am busy with other things, I fall behind this era。“So keep up with the times，Stay relevant。Strive to understand the most watched、The most controversial、Confusing everyone the most、What is happening behind the phenomenon of loss and even anger。”Compared to the return on investment that people have always emphasized，He is obviously more worried about missing out in 2016。"If these things can't keep up，It is the elimination of hundreds of billions of dollars。”

For some people，This is the year of trauma。Co-founder of DCM China、Director and partner Lin Xinhe thinks，Many people invested too quickly in the first two years，It ended up "getting into trouble"。"Because it was thrown too fast，Throwing too hard，Too expensive，Resulting in problems being exposed in 2016。And this is the psychological trauma of the entire investment industry，This situation may continue into 2017。”

Some people think that changes in the external market are nothing to be afraid of，More anxiety comes from within。

April this year，GGV Capital announced the completion of US$1.2 billion in fund raising，Continue to promote global layout。Tong Shihao, managing partner of GGV Capital, told Caijingtianxia (ID: cjtxzk) reporter，It is not easy to be a global fund，His energy and preparation，Both are much more demanding than just being in one market。“And in the process of globalization growth，Will anyone inside lose patience because of this，Will anyone feel discouraged，This is my biggest worry this year。”

Most institutions slowed down their investment pace in 2016，But the project valuation has not been significantly reduced，This means everyone on the field is becoming more cautious，It also means that investors not only have to compete with founders，Investors are also testing each other，This eventually became a multi-party game。The game is spreading，Intensifying。

Different from the global financial crisis of 2007-2009。There were serious problems in the U.S. financial market system at that time，Imbalance among various financial regulatory authorities，Investors’ confidence in financial markets has declined，Selling stocks one after another。Institutional investors、Retirement Fund、The university fund has cash flow problems，Causing PE、VC’s upstream funding sources are drying up，Investors are worried，But empty pockets。

final，Lehman Brothers collapsed，But some people are taking advantage of the crisis to make a fortune。

Under the same market environment，Completely opposite fates caused by different strategies，The Chinese venture capital industry will also continue to perform in 2016。

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“What were you doing during the last financial crisis?”

At the other end of the table，Hu Lei, partner of Blue Lake Capital, thought about it。8 years ago，He works for GGV Capital，This old investment institution headquartered in Silicon Valley, USA was established in 2000，Entered China in 2005，Successively invested in Alibaba、21Vianet、Many first-tier Internet companies including Qunar。2014，Hu Lei left GGV to found Blue Lake Capital。

Strictly speaking，GGV encountered the largest Internet bubble in history almost from the first day it opened。

March 2000，The technology-heavy NASDAQ (NASDAQ Composite Index) climbed to 5048，The Internet economic bubble reaches its highest point。The bubble began 188bet sports betting app download to burst on March 10th，The NASDAQ composite index reached 5048 on that day.62 (more than doubled from 1999 alone)。Only 9 months later，fell below the 2600 point mark。About half a year before this bubble burst，GGV has just completed the first phase of fund raising。

If we go back and study GGV’s fund return rate，You will find that almost all the funds with outstanding performance were born in the crisis，These funds often only wait for three or four years for the industry to prosper again。

“The VC industry itself is counter-cyclical。When stock prices are particularly good，Many people are buying stocks，This is exactly the time when VC exits。Big crises often also breed opportunities to make big money，So the so-called financial crisis，It is an opportunity amid crisis。" said Zhang Zhen, partner of Gaorong Capital，Opportunities often arise from this kind of flute，Because this means that new technologies may be needed to improve efficiency，It may also be that the industry is about to be squeezed，Valuation has dropped significantly。

These investors interviewed said，Today’s industry average valuation still deviates from the company’s actual value。Some companies are valued at hundreds of millions of dollars，But just look at its business volume、Flowing scale，You will find that it is a sky-high price。But even so，Not everyone can invest in this kind of company。

“When the project came to us in 2015，We are mentally clear，He has many choices。Some newly emerging funds，They always have to invest in a few projects first，Can give LPs an explanation。So once the entrepreneur enters this room，I have a clue in my heart。”

Entrepreneurs no longer enjoy this preferential treatment today。Lin Xinhe reminds the invested companies: “Made mistakes in the past two years，You may still be forgiven，Refinancing。And this year，No one will pay for your mistakes。”

He found a significant change is that the project valuation increased only 10%-20% when financing again，And one year ago，There will be three times the valuation。April 2015，58 rush to merge，188bet app download As an early investor in 58.com，DCM is one of the biggest beneficiaries of this merger。

Zhu Tianyu, a partner of Lanchi Venture Capital, also has similar concerns。“CEOs have their own way of thinking and goals。We use our own experience of experiencing cycles for more than ten years to share，Go and remind him to reduce expenditure and increase revenue、Keep the rhythm。But for investors，We are just the co-pilot，The accelerator and brake are ultimately in the hands of the founder himself。”

An unnamed investor told Caijingtianxia (ID: cjtxzk) reporter: “There is a lot of money in the market today，We are not the only ones with money，Our competitors、My colleagues also have a lot of money，It’s just that everyone thinks the valuation is high，No one takes action。This is very harmful to startups that are still in the handover process。Today’s high valuation，It may be your burden one day。”

Discovered by Zhou Zijing, founder of Ethereum Capital，The FA projects I have handled this year have shown several trends: the financing cycle has become longer；The certainty of investment becomes lower；The probability of investors making a false shot increases (even if investment intentions are given，The probability of regret increases)；The number of entrepreneurial projects has dropped significantly compared with last year。

“In the past, only one team was good，We are very confident that we can help him raise money。Not now，If it’s just a team，The direction is slightly worse，Financing is not easy。" Zhou Zijing said，It turns out that a project can be solved by just talking to 20 funds，We may have to look for thirty or forty companies now。

“Our investment rhythm has not changed significantly，But this depends more on the pace at which the innovation field map is opened，Before opening a good map，The market will enter an investment hiatus。Amount of investment this year，And the number of quality startups is not as good as in the previous two years。" said Cao Yi, founder of Source Code Capital。

Data display provided by FollowPlus，According to incomplete 188bet app download statistics，The number of projects that received first investment in 2015 was 2833，861 in 2016。Companies that have not yet generated positive cash flow have to face the next round of financing problems。In two years，The total amount of financing received by all companies in all rounds is 2.11 trillion and 1.72 trillion。

“It can be seen from the data，This year’s total investment dropped by 20% compared to last year，The amount of investment and financing in the mid- to late-stage rounds is basically the same，Mainly because early projects were greatly affected，Concentrated before round B。The overall fund-raising volume of investment institutions this year has increased instead of falling，In fact, a lot of capital was raised in the middle of last year，We caught up with the capital winter in the second half of last year。So investors are not without money，But rich，Hold the currency and watch。”Compare the data of the past two years，FellowPlus founder and CEO Guo Yingzhe came to this conclusion。

The root of fear

Tong Shihao, Managing Director of GGV Capital, believes，Most investors, including myself, understand it，Whether it is the decline of smartphone dividends，Users’ usage time on mobile devices is still becoming saturated，will trigger a series of changes。“So we would say that going to the countryside is important，But the rural market is a new field，Previous experience may not apply，Is there a good enough team that can do this well，Still an unknown number。”

Since the rise of mobile Internet in 2010，From the initial investment in mobile phone tools、Game、Weather、App stores began to rise in O2O in 2014 and Internet finance and other fields in 2015，Over the past few years，We never lack systematic investment entities，At that time, everyone was only worried about the pace of investment。

It’s 2016，High-quality To C projects suddenly fell off a cliff，Traffic is getting more expensive，Platform growth dividend fades。Except for a few popular projects，Most of the year，The way VCs greet each other when they meet becomes: "Have you seen any good projects recently？”

Not just in China，Silicon Valley also encountered similar embarrassment。Qasar Younis, COO of Y Combinator, an American venture capital incubator, told Caijingtianxia (ID: cjtxzk)，More companies still choose traditional high-tech technological innovation，Instead of business model innovation。For low technology content，For a company without business model innovation，Their fields will become more competitive and less attractive。

“We are seeing a decline in the popularity of Bitcoin，The popularity of blockchain continues，Artificial intelligence continues to heat up。” YC’s investment focus is not to bet on industries that may be hot，Instead focus on the core qualities of the founder。“Because trends always change。”

From the perspective of early projects，There are fewer quality innovations。The field of blockbuster innovation is not mature yet，The innovation map is not opened，The situation of lack of supply has resulted in a decrease in the amount of financing companies can obtain。

“But the essence is not in the capital winter，The more reason is asset shortage，Good and quality innovation has entered a transitional adjustment period，This will breed new innovations as technology adjusts。" said Cao Yi, founder of Source Code Capital。Not so much a capital winter，The essence is asset winter，Innovation enters bottleneck period。

In the cold winter of assets，The number of companies receiving money has decreased，Although there is sufficient supply of funds，But the problem lies on the company side and the asset side。Fields with more A rounds have been tested by B rounds and C rounds，There will inevitably be situations where someone is eliminated and funds are reduced。

For early VCs，Technological innovation is particularly important，These startups in the past have formed independent large companies and huge leverage，Most of the funds in each fund began to be concentrated on top projects，Leading companies in various sub-industries are also receiving more and more funds。

Past year，Giants are playing an 188bet app download increasingly important role in investment，Including some listed companies，Everyone is starting to intentionally choose strategic investments。Different from the book returns that financial investors only pursue，These giants often ignore costs in the acquisition process - they consider more market share and other derived values。

Core Internet companies，includes BAT、JD.com、Xiaomi included，They are all actively engaged in equity investment and mergers and acquisitions。New American University、Didi Kuaidi、The industrial capital behind the 58 market is also playing a role，A-share listed companies pass relevant institutions，Also involved in equity investment and mergers。

“If money can build barriers to competition，So many people may be inclined to put money in a project，Although the comprehensive return may be reduced，But the security boundary also becomes larger。So you see that many projects are being completed quickly from Round A to Round E，melt all the way。" said Cheng Yu, partner of Morningside Capital。

Cao Yi said frankly，Past year，I and my team have invested a lot of energy in the key companies we invested in，Some of them have great returns and growth，The regret is，Unable to invest more resources in other companies。

If you go back 10 years ago，There are only a few funds in the market，There are also very few startup companies，Everyone knows ourselves and the enemy。Today is a many-to-many market，There are countless funds and entrepreneurs。

An investor told Caijingtianxia (ID: cjtxzk) reporter，I may have seen good projects in every field more than ten years ago，It’s just whether or not to invest。This situation no longer exists，Nowadays it is impossible for one fund to cover all projects and fields in the market。The benefits are，This gives many new funds a chance to become famous。

“This is a challenge for us。Morningside continues to pursue excess investment returns，Therefore, the operating leverage requirements of the invested projects are very high。This style of play allowed us to capture YY、UC、Opportunities like Xiaomi，But on the other hand, we also missed a lot of opportunities，For example, in e-commerce、Group buying、Fields such as video that require heavy investment to break even。" Cheng Yu told Caijingtianxia (ID: cjtxzk) reporter。

Under the cold winter，More and more roadshow activities called “Demo Day” are returning，It’s different from the start-up project presentations where VCs were “hungry for talent” many years ago，Several “Demo Days” this year，Joked by industry insiders as “The Takeover Conference”。

An investor described his surprise to a reporter from Caijingtianxia (ID: cjtxzk): “Many funds are holding this kind of meeting，Intended to launch their portfolio (project)，Let other insiders take a look，Submit if you think it’s good。Project promotion meetings in previous years，Everyone puts communication first，The purpose is not clear，This situation this year is unheard of in my more than ten years in the industry、Unseen before。”

“We’ve had a few ups and downs，SoftBank China was established in 2000，Caught up with the burst of the Internet bubble。Everyone was struggling at that time，We are struggling too，Ali is also struggling，Our investment in Alibaba was a bold move at the time。But after the Internet bubble burst，Life is not easy。Our first fund is worth US$100 million，It’s quite uncomfortable to invest in most projects，But the projects that survived the crisis，The winner takes all now。” Song Anlan, a partner of Softbank China, told a reporter from Caijingtianxia (ID: cjtxzk)。

"Latest forum，I heard an angel investor say that the return on his investment has been thousands of times，I don’t dare to speak anymore。SoftBank once invested in Alibaba，Currently it is only a few hundred times return。”He said。

Rhythm and Reflection

March 2016，At the LP annual meeting of Gaorong Capital，Zhang Zhen showed two pictures to the LPs，The first picture is the trend chart of the Shanghai Composite Index in the past year，The second picture is the number of newly signed investment intention (Term Sheets) signed by Gaorong Capital in each 188bet Online Sports Betting and Casino period in the past year，The trends of the two curves are exactly opposite，Confirms that the investment rhythm of Gaorong Capital shows a counter-cyclical trend。As Buffett said, "Be greedy when others are fearful，Fear when others are greedy”，Gaorong relies on his investment discipline and sensitivity，This is how it is executed。

Second half of 2015，Zhang Zhen has a lot of anxiety。The temptation of the industry increases，For example, should a fund management company log on to the New Third Board to make quick money，Should we work hard on dismantling VIEs and backdoor listings, etc.。The team has the ability to do these things，And once you choose to do so，Meaning the loss of the original core starting point，Become an arbitrage agency。This is contrary to the value investment that Gaorong has always insisted on。

Qiming Venture Partners managing partner Gan Jianping told Caijingtianxia (ID: cjtxzk)，This year，My biggest anxiety comes from policy uncertainty。Another investor who did not want to be named spoke bluntly。“The government faucet is sometimes turned off，Open sometimes。”

“Policy uncertainty makes me anxious。Premier Li Keqiang proposed ‘mass innovation’ last year，Wanzhong Entrepreneurship’，The government knows very well that we need to start a business，Need innovation，However, in terms of specific implementation, there are often some policies that are not in line with the business environment。For example, Internet finance，Two or three years ago it was still encouraged by the state，Built a national-level Internet financial center，Some scammers came out later，I don’t dare anyone to start a business again，Many people have lost their jobs or left this industry。"Gan Jianping said。

Former IDG partner Mao Chengyu founded Yunqi Capital in 2014，His memories，Entire 2016，Many of Yunqi’s invested companies are going to the New Third Board，He basically tried his best to discourage it，At least advise them not to place too much hope on the New Third Board。At that time，Many funds have found Yunqi’s investee companies，Mao Chengyu will remind them，Don’t spend too much energy dealing with those so-called New OTC Funds。

“It turns out some people listened，Some people waste their time，I haven’t tasted the sweetness from the New Third Board Fund，In the end, normal financing was delayed。”Mao Chengyu, born in the 1960s, is quite wary of this。

More than ten years ago，Shenzhen GEM also had an attractive exit mechanism，Later encountered changes，At that time, a large number of companies died and were waiting to exit，The RMB investors behind these companies also suffered heavy losses，Some disappeared after that。

A RMB fund of funds partner told Caijingtianxia (ID: cjtxzk) reporter，When the New Third Board was popular in the first half of 2015，There have been many short-term funds with the slogans of "1+1" and "2+1" (return cycle)，Most of them no longer exist today。

“Many fund management companies seek short-term profits under the guise of financing，Let’s just ask him a question，How long is the cycle of your fund？If it is lower than ‘5+2’，We don’t have to meet anymore。Investment pays attention to the intrinsic value growth of enterprises，So we always talk about the 10,000 hours rule，You can’t avoid this。”And he also admitted，At that time，The hot bubble of the New OTC Market has indeed made many professional investors unable to find their way。

“From time to time, an organization comes out and says，They have raised hundreds of billions in the market，For long-term investors like us，I really don’t know what to do。”

There has always been a saying in the venture capital industry，That is, one-third of the projects invested will be naturally destroyed or liquidated，One third is neither dead nor alive，Another third of the projects are in good condition，It is a profit guarantee。

2014，O2O door-to-door manicure project Dudu Manicure received Series A financing from Sequoia Capital and Source Code Capital。February this year，58 Daojia announced the merger of Dudu Nail Art。“Early-stage investors need to rationally reflect on previous decisions、Calmly choose to advance 188bet sports betting app download or retreat。This is a test of human inertia。Difficult decisions that are difficult to let go of emotionally must ultimately follow laws and trends，Follow the trend。"Cao Yi reviewed the battle like this。

For Cao Yi，The biggest anxiety in the past year came from the growth path、Grasp the rhythm and pattern。“Investment gives us a wide range of choices，Test cognitive and decision-making abilities。All roads lead to Rome，But what timetable、What path to take、What tool model is used will produce a qualitative change in the results。”

“It’s not just our fund，Any VC is the same，Investing in 20 projects, only two or three will generate huge returns，Probably not more。This means that 60%-70% of decisions are wrong，So，VC is actually a group that makes mistakes all the time。"Hu Lei said。

“From our perspective，Not all companies should receive investment，Because there is too much money。Many companies that should not have received investment have received investment，These become noise，Making companies that should have received investment face greater competition，Some are disorderly competition。” Yuan Wenda, managing partner of Redpoint Venture Capital, believes，In the past ten years，Most early investors will think that there is too much hot money in the market，Available until today，Money is still plenty。

November 21, 2016，owns Miaopai、小卡秀、Yibo’s mobile video platform Yixia Technology confirmed the completion of US$500 million in Series E financing，This is a project jointly invested by Redpoint Ventures and Morningside Capital in 2012。

Past years，The VC industry is dominated by US dollar funds，The value industry chain is composed of US dollar VC。People pursue exit on Nasdaq，Or acquired by BAT。But starting from this year，RMB VC seems to be invincible。An obvious case is，In several rounds of financing for the highly sought-after live broadcast project Yingke，There are almost no US dollar funds anymore，Replaced by RMB VC。

The possible exit channel for these projects in the future is domestic IPO，It is also possible to be directly acquired by a listed company，This shows the value chain of the entire venture capital industry，has quietly changed from one end of the capital chain。

October 2016，Red Dot Ventures announced the establishment of its first Chinese fund，And completed a total of 1.Initial fund raising of US$800 million。Just one month after Redpoint Venture Capital announced the establishment of a RMB fund，Qiming Venture Partners also announced the completion of the fourth phase of RMB fund raising of 1.5 billion yuan。

"There is no such thing in the cold winter。”In Gan Jianping’s view，Limit-up boards are still everywhere in the secondary market，Mergers and acquisitions are emerging in endlessly。In the secondary market，Old fund fundraising went smoothly，Some emerging funds are also growing steadily。"Two years ago，Many BAT executives have been locked in by institutions and received financing before they resigned，Now they may want to be more cautious，Or put some money yourself first。It was too comfortable to get money in the past，Entrepreneurs should think twice now。”

“We have been engaged in venture capital for more than ten years，What I have seen is that this industry has been booming in the past ten years。Ctrip that I personally participated in，There were only more than 100 employees when the investment was made，There are twenty to thirty thousand people now，Because VC invested money，These companies develop technology、Doing local promotion、Advertising。Thanks to our participation，Help this industry create a world-class company of the magnitude of BAT。"Gan Jianping said。

Xu Xiaoping told Caijingtianxia (ID: cjtxzk) reporter，In the process of growing up，From his birth to his departure in his hometown of Taixing, Jiangsu，Housing、The streets have not changed，Just a few more bikes，Just more light bulbs。"But today's Taixing or Yangzhou、Nanjing、Beijing，This change is extremely rapid，So this is a proposition of the times。”He said。

a few years ago，In an internal meeting，Hu Lei once met Zhang Lei, founder of Hillhouse Capital Group。188bet app download As an early investor in JD.com，Zhang Lei mentioned the economic crisis in 2008，He and his team have seized many investment opportunities that seem very rare today。And before that，The entire market sentiment is high，Some people make irrational investments because of this，Zhang Lei did not take action，And consider this a dangerous signal。

The crisis will come soon，These people are busy dealing with the aftermath，This also wastes a lot of time and financial costs。When the real investment opportunity is right in front of you，They may have no money，Or no time。That day，Zhang Lei recalls this experience，Shared his experience after experiencing several rounds of crises with everyone present: When happiness knocks on the door，You want to be at home。

*This article is reproduced from the WeChat public account "Financial World Media" (ID: cjtxzk)。

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