Chapter 338 The art of slaying dragons
"Of course, I will only correct the founder if he/she makes a mistake. Otherwise, I respect their ideas."

Soothing music played in the coffee shop, the aroma of coffee oil wafted in the air, and Xie Jingxing added in a relaxed and gentle manner.

So, who decides who is right and who is wrong?
The answer is obviously him, or the founders will often admit that he is right.

Because the investors and founders have the same ideas, it is a prerequisite for the investment and financing activities to be established. Only after this can the two parties of investment and financing have "smooth communication" unfold.

Huang Zheng unconsciously clenched the mug in front of him with both hands. When they first met, Xie Jingxing was not as strong as rumored, but he was absolutely confident and full of vigor, and he completely disdained to pretend to be modest and calm in the traditional Confucian style.

"I heard that Mr. Xie obtained a double degree in philosophy after studying in the United States?" He probed without hiding his curiosity.

"I have met with many founders since returning to China, and you are the first one to bring up this topic."

Xie Jingxing raised his eyebrows in surprise, and then explained seriously: "You should have heard of the bad reputation of Columbia University's core courses. I remember clearly that in the first semester of college, we studied Homer's epic poem "Iliad", as well as other contents of Western cultural history and philosophy history."

"I found that during the study process, many domestic international students' personal thoughts were gradually assimilated into European and American thoughts, and they turned into public intellectuals and spiritual converts who were criticized by the public."

He complained helplessly: "It's actually quite normal. Undergraduate students who go abroad are 18 or 19 years old, and postgraduate students are in their early twenties. In that kind of social and learning environment, it is those students who go abroad to live a lazy life and gild their own laurels who are not easy to assimilate."

Huang Zheng smiled knowingly. He was also a graduate student in the United States and knew exactly what Xie Jingxing was talking about.

As long as you go out with the desire to learn, you will be assimilated to a certain extent. Being assimilated too much is called brainwashing and becoming a public intellectual, while being only assimilated superficially is called learning from the strengths of others. One can use stones from other mountains to polish jade.

“So I was quite resistant to these courses at first, until I chose my major in my sophomore year, when I learned that the essence of modern finance is a tool to magnify capitalism to the extreme.”

Xie Jingxing changed the subject and said slowly under Huang Zheng's slightly stunned gaze: "Whether it is insurance or banking, they are promoting the transfer of wealth from the poor to the rich. If the market is an idealized completely liberal market without any institutional interference, then it will eventually be the Matthew effect - the rich get richer and the poor get stronger."

"I personally think that this is an important factor in the fact that European and American countries have entered modern society and that the financial industry has always advocated the theory of absolute market freedom over the past 100 years."

He finally said calmly, "According to the current mainstream social class classification, I am exactly rich. After figuring this out, I applied for a double major in my junior year and spent two years studying Western modern philosophy undergraduate courses."

"..." Huang Zheng remained silent.

Western modern financial theory can make the rich richer, so the butt decides and the head is actively brainwashed and assimilated. This logic is self-consistent and simple and crude... But, will those who can speak out this logic and actually put it into action be assimilated?
"The fresh food supermarket brand under Yunhe Logistics opened its first store in Shanghai at the beginning of the year, using high-end Australian Angus grain-fed beef as its cold-start hot product. The news said that 50,000 orders were sold in a single day?"

Huang Zheng put away his curiosity without hesitation and got to the point: "There is overlap in the business of the forward warehouse distribution of emerging fresh food supermarkets and fresh food e-commerce. In this regard, Pinhaohuo should learn from Yunhe."

"To be honest, the last time I paid attention to Yunhe Logistics' fresh supermarket business was at the end of last year when I scolded the project leader for his slow progress during the summary meeting."

Xie Jingxing took a sip of coffee and said carefully: "Whether to invest in Pinhaohuo is a business decision of Taihe Capital. It is a pure financial investment and has nothing to do with Yunhe's strategic layout."

Huang Zheng supported his upper body on the dining table with his elbows, leaning forward quietly with his back arched, like a frightened beast with full alertness.

A tiger with a raging arrogance and a bloody debt took the initiative to find a monkey and talk to him heart to heart, then said that he was just optimistic about the monkey.

This is really not convincing at all. You might as well say whether you want to eat my arm or my leg.

Xie Jingxing said nothing as he quietly looked at Huang Zheng who might jump up at any time. Two years ago, he had to rush into Zhang Yiming's office, lock the door, and use both soft and hard tactics to sign the investment agreement.

The degree of communication and fit between investors and founders’ business ideas, differentiation among competitors, stress testing…

Today, two years later, when faced with the investment interview common sense and skills that all NPC entrepreneurs will know during the Juntai internship exam, he no longer has the motivation and desire to use them.

"The Pinhaohuo business model is very interesting. I think you can do something that is not limited to the fresh food industry." He just told the truth.

Huang Zheng's heart skipped a beat, and he dared not relax at all: "On the consumer side of the market, use the mobile Internet to gather users; on the supply side, find ways to improve quality and efficiency. All fresh food e-commerce platforms do this."

"All businesses in the world do this. I am specifically referring to the 'group buying' business model at the core of Pinhaohuo. If you don't mind, please be patient and listen to me."

Xie Jingxing organized his words calmly. It had been just over a month since Pinhaohuo went online, and the platform's daily transaction volume had exceeded 100,000 orders, with a business growth rate far exceeding that of its competitors.

The operations that Huang Zheng mentioned will be performed by all fresh food e-commerce platforms are fundamentally different because of 'group buying'.

On the consumer side of the market, the person-to-person trading model of group buying makes Pinhaohuo naturally endowed with sharing, dissemination, and diffusion genes that far exceed those of other platforms.

On the supply side, group buying allows the Pinhaohuo platform itself to concentrate transaction volume on a relatively small number of product categories, thereby improving supply chain efficiency.

A consumer browsing other fresh food e-commerce platforms would buy two kilograms of oranges, one kilogram of strawberries, and a durian. However, on Pinhaohuo, only the most affordable seasonal strawberries are sold after comparing all fresh food e-commerce platforms, and the more you buy in a group, the cheaper it is.

This leads to consumers not only using the money they would have spent on oranges and durian to buy strawberries, but also inviting relatives and friends to buy them together.

Then I would pinhaohuo and wave the slogan "I have the largest single strawberry order sales volume on the market" to go to the strawberry producing areas and smash the strawberry farmers to death. Then I would give me the cheapest price and I would buy it all.

Originally, farmers had to consider that if they sold 500 kilograms of strawberries today, the remaining 500 kilograms of strawberries would not be sold tomorrow and would rot in the field. Therefore, the price of the 500 kilograms of strawberries sold today must include the cost of the 500 kilograms of strawberries tomorrow.

Nowadays, it is very cost-effective to sell all the strawberries at one time at a lower price, and Pinhaohuo also makes the most cost-effective price difference, and consumers buy the most cost-effective strawberries.

The costs of each link in the entire supply chain have been compressed to the extreme.

"In my opinion, 'group buying' has a certain flavor of planned economy."

Xie Jingxing concluded: "In conventional commercial capital operations, both the supply-side producers and the sales channels bear the risk of not being able to sell the goods. This risk cost will eventually fall on the value of the goods and will be borne by consumers on the market."

"This is also the business model of e-commerce platforms such as Taobao, Tmall and JD." He re-examined Huang Zheng, whose expression gradually calmed down and his eyes wandered, and continued to speak: "Pinhaohuo can try to expand the 'group buying' model to all categories of e-commerce."

"How do you put it? A planned economic experiment against the theory of commercial capital?"

Xie Jingxing ended with a question, then calmly turned his head and waved to the waiter for another cup of coffee, as his throat was a little dry from talking too much.

Huang Zheng fell into deep silence for a long time, with only one thought in his mind - the person in front of him was truly a monster!

He has just recently explored the feasibility of this theory through the "group buying" business model. He has some vague ideas and is hesitating whether to experimentally enter other e-commerce categories to give it a try.

How could this evildoer in front of him have figured out the metaphysical commercial essence of this matter? Could it be that he really was born in China and studied abroad, and combined the strengths of two institutions to achieve success in both the left hand and the right hand? !

"In terms of theoretical practice, the fresh food category has its own particularities, and other e-commerce categories may not be able to replicate it successfully."

It was not until Xie Jingxing finished a cup of coffee that Huang Zheng thought about his words over and over again and could not find any rebuttal. He lost his guard and began to discuss and seek advice.

Taking strawberries as an example, Pinhaohuo uses the extremely low information summarization cost of the mobile Internet to bring together market consumers who want to buy strawberries and strawberry sellers.

Consumers know that the strawberries on this platform are of good quality and low price, so they just need to buy them. Strawberry sellers know that strawberries on this platform sell very well, so they don’t have to worry about the risk of having to buy the goods.

Risks have been eliminated and supply costs have been reduced. Next year, production factories and sellers will expand production and purchase of strawberries for Pinhaohuo. Costs will be further distributed and compressed, and the strawberries consumers can buy will be better quality and cheaper.

They are incomparable to Tmall and JD.com. In the eyes of the supply side, they just buy some strawberries, oranges and grapes, and are only worthy of purchasing strawberries at the same high price as traditional supermarkets.

Who told them to buy so little and still be picky and complain? Don’t they know the cost risks? Our strawberries are specially supplied by Pinduoduo!
Over time, when the supply chain costs are compressed to the lowest level and external competition on the platform disappears, all consumers will flock to Pinhaohuo to buy strawberries, and internal competition will inevitably occur among the strawberry merchants on the platform.

The entire platform has fallen into an extreme vicious circle of mindless competition for quality and price. At this time, as long as there is a merchant who stands up and uses some technology to sell strawberries by passing off inferior products as good ones and further reducing costs.

The logic of good quality and low price will be broken, and we will enter a more extreme rhythm of low price and low quality.

It's like if someone in the front row of a movie theater stands up and blocks the audience in the back row. Damn their quality! I paid for the ticket too!
Since I can't let you sit down, I'll stand up too, leading everyone in the entire theater to stand up.

The special feature of fresh produce is that it is directly sourced from the place of production. The quality of strawberries can be seen with the naked eye, and the quality of the products can be manually controlled from the source. However, when it comes to clothing, home appliances and other categories, the quality of the products cannot be controlled because there is a professional definition - fakes.

"The problem of counterfeit goods has always been the biggest problem for e-commerce platforms. At the execution level, both Taobao, Tmall and JD.com have put in a lot of effort but have not been able to solve it."

Huang Zheng frowned and thought, "The essence of group buying is that the producers and sellers on the supply side give up their prices in exchange for reducing production and sales uncertainty, and consumers on the market side give up their personal demand selectivity in exchange for low prices."

"In a circulation market centered around low prices, the problem of counterfeit goods will inevitably be more serious than on traditional e-commerce platforms, destroying the business concept of group buying - high quality and low price."

Huang Zheng started to think about the so-called anti-commercial capital theory and practice logic in reverse, and the more he thought about it, the more he felt that this problem was difficult to solve.

Xie Jingxing rested his chin on one hand and absentmindedly played with his phone. When he had said enough, he raised his phone and shook it: "I suggest you visit Kuaishou, ByteDance, and Didi respectively. I just contacted them, and you can go anytime."

"I don't understand." Huang Zheng simply shook his head.

Xie Jingxing used his eyes to signal a postgraduate student who was sitting in the corner of the coffee shop and doing his homework, and then he looked at another white-collar worker who was sitting by the window and working on the latest Apple computer with conspicuous headphone buds, looking like a workplace elite.

"They are from different social classes, but they are both sitting here drinking 70-yuan coffee. Every time someone passes by the window, the white-collar worker typing on the keyboard is particularly exaggerated, and the student party takes pictures of her Montblanc pen with her mobile phone from time to time. We can clearly see that they are all pretending in their own way, right?"

Huang Zheng seemed to be thinking about something and couldn't find a way to describe it. Xie Jingxing simply reminded him, "People are divided into different classes, but people's desires are not."

Traditional businesses follow the user group division method of first-, second- and third-tier cities. Kuaishou used decentralization to break down the traditional market division and quietly gained 1.5 million daily active users.

ByteDance uses extreme centralization to break down traditional market divisions, educate all news distribution platforms, and declare "I am the world."

Uber's high-end private car business in China's first-tier cities has swept the world, but in China, it has been beaten hard by Didi's low-end express car business. To this day, the lower-level carpooling business accounts for the largest share of Didi's revenue.

They all have the skills to slay dragons. They are not meeting commercial market needs, but satisfying the most basic human desires.

White-collar workers in first- and second-tier cities take online ride-hailing cars to discuss the pros and cons of the sharing economy. Poor people with only two coins in their pockets would rather walk five kilometers less if they can get an online ride-hailing car for one cent.

Although poor people don’t understand what the sharing economy is, they know that walking too much will make you tired.

"Currently, Didi is doing the best. Cheng Wei clearly knows that online car-hailing is not an exclusive endorsement of the sharing economy by the social elite."

Xie Jingxing pointed to an online car-hailing vehicle passing by on the road outside the coffee shop window: "Burning money is a tool. The goal is hundreds of millions of grassroots users. This is the domestic reality that Uber China is unaware of."

"Taobao should not shift its strategic focus to Tmall to strictly prohibit counterfeit goods."

He went back to the original question and gave the answer: "Common prosperity is not about letting online shoppers with Apple phones complain that the brand-name bags they bought are fake, but about letting poor people in the mountains with an annual income of 5,000 yuan to use their smartphones to buy a 200-yuan TV online."

"You can say that counterfeit goods are low-grade and pretend not to see them, but you can't really ignore this vibrant counterfeit market."

Xie Jingxing spread his hands: "Do you understand now? Group buying is a tool, and satisfying the human desire for bargains is the purpose. As for real or fake goods, who cares?"

"At least before the business concept of high quality and low price is destroyed, you will have a chance to surpass Alibaba."

Huang Zheng listened in a daze, and experienced firsthand the meaning of what Xie Jingxing said at the beginning of the meeting today: he never talked about dreams with founders, and usually he talked about strategic development and the founders listened.

(End of this chapter)