On the outdoor court of a golf club, Zhu Xiaohu, dressed in white sportswear, asked Zhang Ying, who was dressed similarly to him.
Zhang Ying was aiming at the hole, turned around and asked: "What do you think?"
"I'm talking about Huimin's trip!"
"Instead of trying to attract Penguin, isn't it good to launch joint membership with several other groups under his umbrella?"
Zhang Ying smiled and said, "Zhang Yida is a very measured young man, so let's not worry about him."
"You just have such a good attitude and you are not anxious at all."
"When investing, you have to have a good attitude! Otherwise, you will only make yourself very tired by worrying so much."
Zhang Ying looked at Zhu Xiaohu, "You just think too much, so you are asking for trouble."
Zhu Xiaohu fiddled with the club in his hand and said with a wry smile: "Where did I think too much again? Have you read Huimin Travel's third quarter report?"
"See, it's not optimistic!" Zhang Ying also put away his smile and said in a serious tone.
"Total revenue was 2.794 billion yuan, total expenditure was 3.87 billion yuan, and net loss was 1.076 billion yuan."
Zhu Xiaohu shook his head and sighed: "This is still a quarter! The loss is almost US$160 million. I want to see how long the US$1 billion in Series C financing can sustain it."
"It's very simple. Divide ten by one point six, and the result will be six quarters."
Zhang Ying slapped his head, "Oh, it may not be six quarters, and the US$1 billion spent on purchasing bicycles and trucks is almost 300 million dollars.
There is still 700 million U.S. dollars left. If calculated at a loss rate of 160 million U.S. dollars per quarter, it can probably last for 13 months.
Huimin Travel received financing in April and is expected to declare bankruptcy in May or June next year!"
Zhu Xiaohu glanced at Zhang Ying, a little speechless, and pretended to be angry: "Hey, let me tell you business, stop showing off your very limited sense of humor."
Zhang Ying patted Zhu Xiaohu on the shoulder and said, "Don't be too pessimistic. Have you read the financial report carefully?
By divesting the two businesses of aggregating taxi-hailing and ride-hailing, revenue will be reduced by 2 billion and losses will be reduced by 500 million.
In other words, the revenue of shared bicycles should be more than 700 million and nearly 800 million, and the loss is almost more than 500 million."
"Is more than 500 million still too little?" Zhu Xiaohu asked again, "The loss is more than 20 billion a year. How many companies can withstand such losses?"
Zhang Ying waved his hand, "This loss of more than 500 million is mainly caused by the depreciation of bicycles and trucks.
The value of physical assets such as bicycles and trucks exceeds 10 billion yuan, and depreciation alone costs 750 million yuan every quarter.
If depreciation is excluded, Huimin Bicycle has actually become profitable."
Zhu Xiaohu spread his hands, "But the reality is that you can't ignore the losses caused by depreciation.
These bicycles will be scrapped after one, two, or three years. You have to put in new ones, right?
It’s impossible to ignore it, right? That will only lead to a decline in the number of bicycles, a decline in the market, a decline in revenue, and a decline in users.”
Zhang Ying nodded, "I understand what you mean, you have to proceed from the actual situation!
Huimin Bicycle’s current cycling revenue per quarter is 500 million yuan, calculated based on the actual inventory of 9 million bicycles.
The income generated by each bicycle per day is only 60 cents.
If this "six cents" figure can be turned into one dollar and two, Huimin Bicycle will basically be able to break even."
"One dollar and two?" Zhu Xiaohu shook his head and laughed, "It's easier said than done! Either the bicycle rate will be doubled, or the order volume will be doubled.
For the former, if the price is doubled, it is still unknown whether it can maintain orders of 30 million to 40 million per day.
In the latter, the number of cycling orders has hit a ceiling, and shared bicycles have been launched in fourth- and fifth-tier cities.
Where else can we continue investing? To the countryside?”
Zhang Ying nodded, "Your analysis is correct, it is difficult to do. However, isn't Zhang Yida thinking of a way? He has also launched aggregation of taxi-hailing and ride-hailing services, etc."
"What can we do? Without the aggregation of ride-hailing and ride-hailing, Huimin Travel only lost more than 500 million this quarter. With these two businesses, the losses have doubled!"
Zhang Ying thought for a while and said: "We can't understand it this way. In the early stage, we were subsidizing users and issued a lot of taxi coupons, so losses were inevitable.
The main purpose is to change users' taxi-hailing habits and make them accustomed to taxi-hailing through Huimin Travel.
This is the cost of educating users, which cannot be saved. Look, didn’t Didi also spend tens of billions?
In the long run, it should not be difficult to make profits from these two businesses, but the profits will not be too high.
But it’s not bad, it has accurately monetized all the traffic that benefits people’s travels.”
"What you say makes sense, but I still reserve my opinion and am not optimistic about the profitability of Huimin Travel."
Zhu Xiaohu sighed, "Think about it for yourself! Even if the aggregation of taxi-hailing and ride-hailing services succeeds in making a profit, how much profit will there be?"
Didi currently handles 10 million orders per day, with an average order price of 20 yuan.
Huimin Travel has captured 10% of the market, with daily revenue of 20 million yuan and 1.8 billion yuan in a quarter.
Then the commission shared with partners is 20%, which is 360 million yuan in revenue.
This 360 million yuan is needed to maintain system research and development, employee salaries, and the most expensive user operations.
Also beware of competition from Didi, betrayal by partners, and even plagiarism and imitation by others.
In the end, it would be good to maintain a profit margin of 30%, which means a net profit of 100 million yuan per quarter. But 100 million yuan is not enough to fill the hole in Huimin Bicycle.
Huimin Bicycle still has a shortfall of NT$500 million, who will fill it?
Advertising? Ruixiang, Pate Holdings, and Pinduoduo together contributed 10 million yuan in revenue this quarter.
Deposit financial management? Ruimin Financial Management contributed 150 million in revenue this quarter, and distributed 75% of the profits to Huimin Travel."
Zhu Xiaohu took a long breath and then said: "No matter how fancy it is, it's useless. We only need to focus on one essence: Huimin Travel's main business is shared bicycles, and its main assets are also shared bicycles.
So in the final analysis, if you want to solve the problem of profitability, you have to focus on cycling income.
If this problem is not solved, Huimin Travel will never be able to make a profit."
Zhang Ying pinched his chin and thought carefully about Zhu Xiaohu's words. After a long time, he said: "What do you want to do?"
"I'm going to jump out of the car!"
…
"Lao Lu, how are you? Are you feeling well?"
In the office of Zhonghe Group, Zhang Yida looked at Lu Qi sitting on the other side of the sofa and couldn't help but expressed concern.
What a fierce man! Absolutely fierce!
During this period, Zhang Yida heard from his subordinates many issues regarding Lu Qi's work and life style.
Get up at 4 a.m., answer emails, go for a run, and start work at 6 a.m.
Self-discipline and workaholic, two labels were attached to Lu Qi.
The company is full of people born in the 80s and 90s who are all ashamed of this uncle who was born in the 60s.
"Ha ha!"
Lu Qi smiled and guessed that Zhang Yida heard about his work and rest time from somewhere.
"I'm used to it! When I was at Microsoft, this was the schedule.
As people get older, they often can’t sleep in the middle of the night, so it’s better to work and exercise instead of tossing and turning in bed.”
Zhang Yida nodded. He was indeed a capable person who climbed from an ordinary programmer to the vice president of Microsoft. He indeed had many advantages that ordinary people did not have.
"After learning more about Pinduoduo and Doushi, I really admire your vision and strategic goals of Yida."
Zhang Yida smiled and said nothing. He also wanted to hear what Lu Qi thought of the two companies and himself.
“Let’s talk about Pinduoduo first! In China, where the e-commerce landscape has been basically stable, to be able to suddenly emerge, I have to say, Yida, you have chosen a good market.
The third- and fourth-tier cities and rural markets happen to be markets that Ali and Goudong have not covered, or the coverage is not enough.
These people are price-sensitive and don’t have too many requirements for brands, and Pinduoduo’s factory-building model just meets their needs.
In addition, I won’t comment on other methods such as attracting Penguin to invest in the company, entering the WeChat Zodiac, blocking competitors such as Pinhaohuo, etc., as they are all necessary.”
Zhang Yida smiled and said: "Then do you think Pinduoduo has any hope of punching Goudong and kicking Taobao in the future?"
"It's too far to talk about this now," Lu Qi said with a smile, "We should be more realistic and focus more on user penetration, factory system construction, and logistics construction.
When the heat is on, e-commerce will naturally have a place to compete with Pinduoduo. As for surpassing Taobao and Goudong, let nature take its course!"
It seems that Lu Qi still lacks confidence in Pinduoduo. Zhang Yida did not explain and continued to listen to him.
Lu Qi added: "As for DouShi, in the short video field, I never thought there would be such a big market and opportunity.
This is a subdivided area that has been ignored by giants, and startups have great opportunities.
But there is a very serious problem that we need to seriously consider."
Zhang Yida asked: "What's the problem?"
"Monetization," Lu Qi said, "for commercial monetization of DouShi, we need to consider sideways live broadcasting or advertising?"
"What's the difference?"
Lu Qi nodded, "It's very different, let me take Kuaishou as an example!
Kuaishou video content mainly records daily life. The content creators are mainly ordinary people. They are closely related to life and have strong social attributes. Videos from long-tail users have more exposure opportunities.
Its decentralized positioning helps diversify video content, easily resonate with viewers, and form a sense of identity and strong community cohesion.
Therefore, if we do live broadcast, Kuaishou is naturally better than us.
As for TikTok, the video content is more trendy and personalized, with beauty filters, funny stickers and VR special effects, coupled with "magic" and "ear-catching" high-tempo music, making it more "trendy" and "personalized"
"Chinese" characteristics.
However, centralized positioning is eye-catching and the popular content is highly similar and repetitive. Therefore, the audience will only pay attention to a few KOLs, and the relationship between users is weak.
We may not be suitable for live broadcasting, and advertising monetization is more suitable for us."