Chapter 183 57 Times Return
[This recording is dedicated to those women who have betrayed men for money] - MC Tianyou.

The elegant woman with well-maintained skin, dark red lip gloss and a beige turtleneck sweater listened to it over and over again.

I tried my best to understand why this short five-minute rap song with a strong Northeastern folk flavor could become so popular in a strange way.

It did not top the trending searches on Weibo and other Internet media and social platforms, and there was no trace of its existence in traditional news media.

However, data from Kuaishou's backend shows that this rap video titled "Ladies, Listen Up," or radio audio, has been played tens of millions of times in two months.

Its creator is a host on the YY voice platform. He registered a Kuaishou account with the help of this audio clip, and his number of fans exceeded 40 almost overnight.

This has led to a large number of YY anchors entering Kuaishou and editing the live broadcast content into short video clips for release.

With the help of this wave of traffic, Kuaishou has achieved daily active users of over 800 million in half a year, and is growing by leaps and bounds at an average daily growth rate of over . Tens of millions of daily active users are just around the corner.

"You should participate in Yunshan Group's agricultural assistance and poverty alleviation activities."

Xie Jingxing commented: "The rapid economic growth and huge population base have created a special social structure. This is written on paper, and those of you who enjoy the Huangpu River view and eat the 588 breakfast buffet will say it."

"But in fact, you have never really felt what a deformed social structure this is."

He jokingly took a sip of the auction-grade red label Geisha coffee from Panama's Emerald Estate. Su He turned off the audio and shrugged, with dissatisfaction written all over his face.

Xie Jingxing raised his eyebrows: "Well, I have never really felt it, but I have tried to experience it."

When he was thirteen, Lao Xie took him to the mountainous area of ​​Guizhou to investigate a charity primary school. They stayed at the principal's house. When he woke up in the morning, he lay in a bed full of damp and moldy smell. The sunlight shone through the dark window and dust fluttered on the ground.

The principal's younger brother, who was two years younger than him, held a pack of fake Nestle instant coffee and a packet of expired sandwich toast in his dirty, sweaty hands.

That was the most suitable breakfast for a rich kid like him in a small shop in a secluded village, although he would rather have a bowl of porridge and potatoes sprinkled with strong chili powder.

But the little brother thinks he should eat damn instant coffee and sandwich toast, and the principal thinks that this is the life of the rich people in the city.

"There is an insurmountable gap between us, and that's where the value of Kuaishou lies. It builds virtual bridges between various gaps, allowing people to see the other side of the gap," Xie Jingxing concluded.

Su He was speechless. She still couldn't understand the outrageous growth rate of Kuaishou: "It sounds like we are doing a great business."

"I have never doubted this, so more and more people want to get involved."

Xie Jingxing tapped the table to emphasize the point: "Shen Nanpeng called me, Sequoia wants to participate in the B round of Kuaishou. Su Hua and Cheng Yixiao will arrive in Shanghai in two hours, and they will bring a tail with them."

"DST?"

Su He concentrated her attention. She was in charge of two projects, Kuaishou and Byte, and had dealt with Zhou Shouzi before.

Xie Jingxing nodded: "Their level is the same as always. Last night in the early hours of the morning, they almost fooled Cheng Yixiao and Su Hua into signing a TS (investment intention agreement) with a post-investment valuation of US$9.5 million on the spot."

"The valuation is too high." Su He frowned slightly.

Xie Jingxing introduced the situation: "This morning, Cao Xi blocked Cheng Yixiao at the airport. The two of them failed to reach an agreement and felt that the valuation was too high, so they gave the lead investment rights to DST, and Sequoia followed suit."

"They want to get a good position, and then make more investments if Kuaishou develops well. This is a really good plan."

Su He understood immediately, and after a brief pause, he said, "But Kuaishou doesn't have so much money, and they don't have any promotion plans this year."

The BUG-level performance of Kuaishou's user data growing by percentage of regional population is entirely due to the "decentralized" product logic promoted by Cheng Yixiao.

In the early stages of platform development, try to avoid artificial promotion to prevent the emergence of top KOL users like Tianyou who would squeeze the space for ordinary users to create content.

Allowing the bottom-level users to grow wildly, there is the spirited young man from the Northeast who performs social dance, the 15-year-old pregnant mother in the southern mountainous area, and the Huawei savage who is on a business trip in Africa.

These user groups do not need promotion, let alone see promotion; they will divide and multiply like cells.

This is why Shen Nanpeng was so amazed. The vast majority of domestic Internet products expand the market from top to bottom.

QQ's early users were definitely wealthy people, WeChat's early users were fashionable and trendy people, and only Kuaishou was expanding from the bottom up, which means they have no established ceiling.

DST and Sequoia understood this and are scrambling to pour money into Kuaishou. But the absurd thing is that if Kuaishou gets such a large sum of money and uses it for promotion and marketing to change its product logic, they will not invest.

Currently, Kuaishou’s equity structure is that the founding team holds 63%, Taihe holds 20%, and 17Y Capital holds %.

Is it necessary for Kuaishou to raise a large amount of funds to dilute the equity distribution? If necessary, how should the shares be allocated and how should this huge amount of funds be used?

"From a strategic perspective, it is necessary to raise large amounts of funds. Sooner or later, investors with deep Internet resources such as Sequoia and DST will have to come on board. They will certainly not be satisfied with small investments."

Xie Jingxing had long anticipated that Kuaishou's current round of financing would be more complicated.

In the last round of financing, Taihe acquired a 1500% stake at a valuation of US$20 million. The money was used for server expansion, product design, intelligent algorithm and other technical developments.

With the approval of the 12G network in December last year, the number of users has continued to grow rapidly, and the funds on the books were exhausted and hit bottom last month.

Cheng Yixiao and Su Hua wanted to raise funds. Zhang Fei of 1Y Capital was very calculating and expressed his willingness to use a valuation of US$ million and invest a few million dollars in Kuaishou, which would be enough as long as they didn't need to rush to get large amounts of funds.

Su He happened to be in Beijing dealing with Wang Xing at that time. When he learned about this, he immediately tied his hair and counterattacked, offering a valuation of US$4 million. If Y Capital's valuation is lower than this, it will have no chance of success!

Wuyuan certainly couldn't compete with Taihe in terms of money. The two sides insisted on their own opinions and could not reach a consensus. Cheng Yixiao and Su Hua were so annoyed by the quarrel that they decided to raise funds from outside and introduce new investors.

In this context, large-scale financing with high valuations was expected to a certain extent, but no one expected DST and Sequoia to double their offer price.

5Y Capital no longer has to think about getting a bargain, and Taihe has no chance to follow up with the investment, so the financial investment has naturally evolved into a strategic investment.

"Cheng Yixiao called me in the early hours of last night and said that the maximum additional shares would be no more than 15%, and that DST and Sequoia would divide the quota among themselves. We will not participate."

Xie Jing Xing thought seriously and said, "As for how to spend this money, if it doesn't work, why not invest it in our fund and do some short-term financial management?"

“…Haha.” Su He laughed twice in support, but it sounded more like a mockery.

Xie Jing Xing curled his lips in boredom: "After all, it is a billion-dollar emerging unicorn. We should rent an office building, expand the recruitment of recommendation search engines, and put the development of editing and advertising distribution products supporting the platform on the agenda as soon as possible."

“It’s not just venture capital firms that can see Kuaishou’s high growth; competitors are on the way.”

He said thoughtfully: "Moreover, mobile entertainment live broadcast products will also be introduced."

Xiyou invested in Meitu last month, and its female-oriented short video product "Meipai" is about to be launched. When it ignites the live broadcast industry, Momo, Inke and the like can barely be considered as Kuaishou's competitive products.

You can always spend money if you want to, that's not the point.

Xie Jingxing picked up his coffee: "Anyway, congratulations on investing in a company that has grown dozens of times." "57 times, that's a bit exaggerated."

The corners of Su He's mouth curled up, and his smile came from the heart.

In this round of financing, Kuaishou's valuation increased nearly tenfold, from US$1 million given by Wuyuan to US$9.5 million after investment by DST.

But a closer look reveals that Taihe's book return is 57 times. Based on the 15% stake shared by DST and Sequoia, the 17% stake held after dilution is worth approximately US$1.6 million.

A return rate of 57 times in half a year will obviously become Su He's masterpiece. A careful calculation of domestic venture capital projects in the past two years shows that the return rate is only slightly lower than that of Didi.

You should know that Xie Jingxing personally participated in all major decisions during Didi's development period in the past year, and Taihe Xiyou did not get the full growth return rate of Didi's valuation.

The Kuaishou project didn't require him to worry much, he just helped to straighten out the development strategy to make Kuaishou develop more smoothly and quickly.

Taking all factors into consideration, she will definitely be ranked higher than Tang Man in this year's domestic annual venture capitalist list!

It remains to be seen whether Shen Nanpeng can maintain his TOP1 position. The young man standing behind her and Tang Man is likely to top the list.

"Keep calm. Later, explain to Cheng Yixiao and Su Hua the positions of the investors in this round of financing. You must make them determined to do decentralization and not let them be carried away by this large amount of financing."

Xie Jingxing unconsciously lowered his voice: "Also, help them reduce the shareholding of DST and Sequoia as much as possible, preferably to less than 10%. It is not convenient for me to come forward now."

"Does Shen Nanpeng have any explanation?" Su He grasped the key point sharply.

Xie Jing Xing was in pain: "He said Zhu Xiaohu was scolding me, and he would scold me no matter who he talked to."

DST and Sequoia gave a valuation of up to 9.5 million, so naturally they want to invest more. Conversely, Kuaishou and its early investors hope that the newcomers will hold fewer shares.

It's understandable that Taihe is helping Kuaishou compete with DST and Sequoia, but Shen Nanpeng rarely calls him, and it would seem a bit fussy if he showed up in person.

In addition, Shen Nanpeng mentioned the competition between Ele.me and Meituan on the phone, vaguely trying to broker a temporary truce between them.

"How can we invest in Meituan if he comes to match us up? We can't pay any attention to him." Su He widened his eyes.

Xie Jingxing said with relief: "That's it, you help Kuaishou negotiate whatever needs to be done and stand firm."

"It's better to help you share the firepower." Su He complained bluntly.

The takeaway war has been going on since the Spring Festival. In the blink of an eye, more than a month has passed. Both sides have burned hundreds of millions of dollars in total and the war has become more and more brutal.

The temporary competition in the online travel holiday market has not yet ended. Baidu Nuomi, which has just completed its integration, is now facing off against Dianping in the group buying business. Meituan, which is facing competition from all sides, has been rumored to be raising funds every few days.

After many setbacks, the average daily order volume of Meituan's food delivery business exceeded 500,000. After Ele.me, which benefited from WeChat red envelopes, had an average daily order volume of over 1 million, the growth rate has been steadily declining.

Quhuo, Yunhe, Dada, and many other crowdsourcing logistics companies have entered the field of vision of industry insiders. Everyone has realized that the entire local life battlefield has entered a tug-of-war stage.

Before Cheng Wei, who had a grudge against Wang Xing, could smile, rumors emerged that a conference would be held in Beijing regarding the introduction of policies for the online car-hailing industry.

As expected, Uber has embarked on the strategic approach of recruiting city partners, while also considering cooperating with Weibo, which will provide it with platform customer service.

The launch of customer service represents the target of the mid- and low-end market. We have to admit that Uber’s speed of adjusting its strategy and tactics has put Didi under tremendous pressure.

All in all, all walks of life are fighting fiercely nowadays. Xie Jingxing met Zhang Fei of 5Y Capital at the beginning of last year. Because the two companies invested in different online car-hailing platforms, it felt like an awkward situation would not happen during the conversation.

Now, peers in the venture capital circle are accustomed to fighting and cooperating at the same time. For example, Taihe and Sequoia are fighting to the death in the local life field, while investing in Kuaishou is a cooperative confrontation, and even in the field of game live streaming, they advance and retreat together.

Correspondingly, small-scale early-stage venture capital institutions headed by Zhu Xiaohu were in great pain. They invested in Didi and Ele.me, but were pushed around by Xie Jingxing and forced to burn money in the battle.

This guy told people privately while drinking that he hoped, more than the founder, that commercial laws would be quickly introduced to resist vicious competition.

Only if those inhuman warmongers are restrained can small early-stage venture capital institutions have a chance to survive.

As such, Xie Jingxing still has to be more or less concerned about his reputation.

He was too young to be able to brazenly run to Alibaba to poach people and was deeply involved in the Didi Kuaidi's M&A process.

His colleagues can just say a few words to him based on their seniority and complain and grumble using slogans about professional ethics.

"In any case, Meituan has not reached the end of its rope. I will talk to Wang Xing after it holds on for a while."

Su He didn't care about the scolding. She was the T0 version of the middle-aged workplace heroine. If Zhu Xiaohu dared to call her a war criminal, she would dare to call Zhu Xiaohu an old thing.

Xie Jing Xing gave him a thumbs up in admiration: "Come on, I'll wait for your good news."

"To be honest, I never realized that you actually cared about your reputation." Su He couldn't help but tease.

Xie Jingxing sighed helplessly: "I didn't care at first, I have grown up again."

"Huh?" Su He was confused.

“When others take you seriously, you’d better take yourself seriously too.”

Xie Jingxing raised his tone: "They have both good and bad opinions about me, but the internal logic is consistent - they all recognize that I have the ability to influence the structure of an industry."

"That's a good start. I need to live up to their impressions, at least on the surface."

He laughed proudly, "As a legend, I never look back, just like Brother Ma won't spit at each other and compete with the spirit boy in dancing skills on the street."

His reputation is valuable now and should be protected.

“But it seems that no one would call themselves a legend.”

Su He was stunned by the sudden harassment.

"When I just returned to China last year, I met with a headhunter from Heidrick & Struggles in this hotel. She told me about Kai-Fu Lee and the legendary achievements of Robert Kuhn. I told her that I would become the next legend."

Xie Jing Xing said to himself, "Guess what? She didn't believe it either, but on the day the Didi Kuaidi merger was announced, she shared her experience of meeting me on WeChat Moments."

"so?"

"So you are witnessing the making of a legend, ma'am."

"I'm honored." Su He restrained his expression and said seriously.

(End of this chapter)