The Birth of Shanghai's First Conglomerate

Chapter 128 Advanced Operations
No wonder Tong Zhelan wanted to organize this class reunion.

It turns out it was also to raise funds for the angel round project she had just invested in.

There's really not much to say about this. You can vote for whatever you want at the class reunion, and she won't try to scam you with any random projects.

At her level, personal credibility is extremely important.

With so many classmates contributing to a 100 million yuan funding round, it's too easy.

Many people don't even care whether it will succeed or fail in the end.

Consider it a way to get closer to Tong Zhelan.

Later, the classmates drank tea and chatted about other things.

Old Yang, who runs a hotel, said that homestays are very popular now, but it's hard to scale them up.

It needs to be built in scenic locations, and forming a chain is very difficult.

It's not as good as 7 Days or Jinjiang, which can be easily replicated.

Some people say that online travel agencies or food delivery services are doing well now.

Let's not even talk about food delivery; the market is too big, and it's already been divided up by Tencent and Alibaba.

In the internet startup scene, if you're noticed by both Tencent and Alibaba, most people basically have no chance.

Take the ride-hailing market as an example: Tencent invested in Didi, and Alibaba invested in Kuaidi.

These two companies are practically fighting tooth and nail in the market.

Tong Zhelan's international investment bank invested in Didi, after the initial period of fierce competition in the ride-hailing market.

Then, only these two major players remained in the market.

Many students, especially Huang Bin who works in the sharing economy, were extremely interested in this and were eager to learn more about the inside story.

The other students were similarly curious, and even Chen Pingsheng was quite curious, since it was just too crazy.

Have you ever seen a company burn through billions of dollars a day?

That's the situation for these two companies right now.

Seeing that they were all interested, Tong Zhelan said:

"The situation is quite special now. It's not so much that Didi and Kuaidi are fighting, but rather that the companies behind them, Tencent and Alibaba, are competing in the same market."

"You all know these two companies. One is the leader in social media, and the other is the leader in e-commerce. They have indeed fought several rounds of battles before. Investors on both sides have put up tens of billions of dollars in the hope of wearing the other down, so that they can end this pointless money-burning war and set the final rules of the game."

"It's a pity. Whether it's Alibaba leading Kuaidi trying to wear down Tencent leading Didi, or Tencent leading Didi trying to wear down Kuaidi, it's impossible."

"The investors on both sides are getting restless and are eager for them to sit down and talk. The most likely outcome is a merger!"

"They're going to merge them after putting them together like this?"

Huang Pujun, who has little business acumen, interjected.

Tong Zhelan glanced at her indifferently, not even bothering to explain.

"That's probably how it will be."

Huang Bin said, "If we don't merge, no investor can stand this kind of competition."

“Indeed,” Old Yang agreed. “The internet is really ruthless. Only when there’s only one left can it set the rules of the game and start thinking about making money.”

"It's been so many years, and the internet is still being suppressed by these three mountains. I wonder how many more years it will take before one can truly stand up to them."

No one can explain this topic clearly; even Tong Zhelan herself finds it too difficult.

The three major internet portals.

Social media, search, e-commerce – BAT (Baidu, Alibaba, Tencent) have already established themselves too deeply in their respective fields, unless another disruptive company emerges.

Companies that can regain users' time.

This disruptive model was something Tong Zhelan could never have imagined.

I don't even think anyone can do it.

It has to be said that this small class reunion contained a wealth of business information.

Even Chen Pingsheng felt he benefited greatly from this experience.

Tong Zhelan is at the forefront of the times. Besides the Internet, new energy vehicles are very likely to be the next big global trend after mobile phones.

This project has a very high barrier to entry, requiring a minimum investment of tens of billions of yuan.

None of the competitors are simple, she also talked about the global situation of new energy vehicles.

The earliest person in China to propose developing new energy vehicles was Jia Yueting of HotTV.

He announced this slogan a long time ago, which shows his insightful vision. He is also preparing to start fundraising this year.

Do you think he has a chance of successfully developing new energy sources?

"Difficult." Tong Zhelan used only one word to describe it, mainly because building cars is not like running an internet company, where you can burn money to create a unicorn.

Besides the financial hurdles, car manufacturing also presents extremely high technical barriers.

"Jia Yueting is very capable, but he does too many things, and they are too varied."

Tong Zhelan commented: "Abroad, any high-tech company that can succeed requires its founder to be extremely focused. Looking at high-tech companies abroad, almost none have succeeded like him, not to mention Tesla, which has been ahead in this field for ten years."

To put it bluntly, LeEco had too many interests; it wanted to do everything and was involved in everything, but it didn't excel at any of them.

In Tong Zhelan's view, this was a very scary thing, to put it bluntly, it was the possibility of a complete collapse.

That would mean the entire system would collapse.

Among this group of classmates, she always felt that Chen Pingsheng was the most reliable.

The reason is simple: they have no debt whatsoever.

If one company goes bankrupt, it won't affect the other.

This is equivalent to having many baskets, scattered around each other.

But something completely different is happening with HotTV; they have dozens more baskets, each filled with eggs.

The danger lies in the fact that he uses the same carrying pole to carry it.

Once funding issues arise, these projects propped up by burning through financing are destined to be nothing more than a mirage.

Therefore, she never dared to invest in LeEco.

Many international investment banks, like her, don't really like investing in such large and comprehensive companies.

Chen Pingsheng was quite interested in a startup project with a threshold of 10 billion yuan.

Unfortunately, he doesn't have the ability to get involved in this at all right now.

We talked about many other industries, and in general, there are still opportunities in all industries, just not as many as in the 1990s or 2000s.

The business environment is already well-established, and the next step is for both small retail stores and large chain enterprises.

Breakthroughs in business management are needed for all of them.

Ordinary people have no chance of surviving in today's ever-changing world.

The class reunion went quite late, but overall everyone gained something from it.

There's no need for anyone to hold back or hide anything when exchanging ideas and discussing things. After all, we're already at this level; using petty tricks would only make people look down on us.

Among them, the most focused one is He Bijun, and the other is Lao Yang.

One of them raised pigs his whole life, and the other ran a hotel his whole life.

They are all top performers in their respective fields.

"Old Chen, tell me about your Shuiyunjian."

Tong Zhelan said, "I've always heard your employees say how great you are as a boss. They use villas for employee dormitories, and you still pay them 10,000 to 20,000 yuan a month during training. You also give them bonuses all the time. Is the profit margin in the beauty industry really that high?"

Everyone turned to look at him. Shuiyunjian, who didn't know much about him before, got to know him later.

It was mainly Tong Zhelan's side that directly gave it a valuation of 2.5 billion.

They even offered to invest 1 billion, but were ruthlessly rejected.

This is very exaggerated.

Putting everything else aside, judging solely from the valuation of this one company, Chen Pingsheng is actually one of the wealthiest people in the industry.

Keep in mind that he now owns 75% of Shuiyunjian's shares.

That translates to two billion.

If we add the other three families, and Wang Yanfeng doesn't go home to inherit his father's fortune, then there's still a gap between them.

"High-end beauty treatments are indeed quite profitable; the gross profit margin for that stuff is over 90%."

Chen Pingsheng said, "The most profitable ones are not the manual treatments, but the foreign instrument treatments. A single anti-aging instrument treatment can cost hundreds of thousands of yuan, and clients don't just do it once. There are at least dozens of instrument treatments that can be done all over the body. You could say that even the richest women have a bottomless pit when it comes to spending money on beauty."

Seeing their eager eyes, Chen Pingsheng smiled and said, "If you want to become my colleague in this field, you'd better pay attention, because this year I will invest another 100 million yuan in opening a store in Beijing, and another 100 million yuan in equipment. Next year, I will also expand to Shanghai."

"The first investment will be around 300 million. If you don't have a few small targets in mind, you'd better avoid competing with my Shuiyunjian."

"Tsk... No wonder you dared to refuse even a billion."

He Bijun felt that raising pigs was profitable enough, but compared to his Shuiyunjian business, it was still a lot more profitable.

This is outright robbery! And even robbery doesn't happen this fast.

Others were incredibly envious of the 90% gross profit margin.

What is this concept.

Let's take his initial experience project from 1980 as an example.

Profits reached as high as 1800.

This is fucking blatant robbery!

"The beauty industry is indeed extremely profitable, but unfortunately it's difficult to replicate."

Tong Zhelan said, "Your ability to quickly break into the high-end beauty market in Beijing is largely due to your Tengying Entertainment. I've noticed that your entertainment company seems to have been created specifically to support your physical businesses. I'd like to know what your five-year plan is for the future?"

"My five-year plan is actually quite simple."

Chen Pingsheng said, "This year I have invested nearly 100 million yuan in Boiling Sheep. By the end of the year, I will use the platform customers of Shuiyunjian to complete the Series B valuation of 500 million yuan. In the next two years, I plan to expand Boiling Sheep to three other first-tier cities."

"The same goes for Shuiyunjian. Once the path of Feiyangyang is successful, to use a simple phrase from your investment banking circle, I will use Tencent Entertainment's traffic to replicate any catering industry that can be replicated. Even if only three out of ten succeed, that is still much higher than your success rate in venture capital."

Tong Zhelan looked at Chen Pingsheng with slight surprise; this guy had a lot of potential for future expansion.

The key is stability.

This is particularly commendable, compared to the kind of all-around losses that Lao Jia incurred by firing shots here and there.

Running in a straight line on a single path is obviously much safer.

The key is that it's fast.

Just like BAT (Baidu, Alibaba, Tencent) building their own moats, this company has been building its own traditional corporate moat from the very beginning.

If you want to emulate him, you first need to own a very successful entertainment company.

Secondly, you need to make a significant portion of Beijing's top wealthy women your loyal customers.

This is naturally the place called Shuiyunjian.

On one hand, they focus on traffic, and on the other hand, they leverage Shuiyunjian to build a strong network of connections.

He himself possesses exceptional chain management skills.

At this point, all we need to do is create some tools that can be put on the market.

This tool could be Boiling Sheep, a milk tea shop, or even the smallest husband-and-wife-run spicy hot pot shop.

Even a late-night food stall would be fine.

All he needs to do is pour all the resources he controls into it, and even a pile of cow dung can be turned into a glittering gold nugget.

“Brother Chen, I can provide you with pork, so you don’t need to look for anyone else for your Boiling Sheep’s Series B funding.”

He Bijun discovered a huge business opportunity.

He has always wanted to establish his own unique sales channels.

Why look elsewhere now? Investing in him is enough.

If we follow his suggestion, we can connect these traditional industries into a straight line.

What industries can't you break into?

Tong Zhelan waved her hand and said, "Old He, it's definitely not appropriate for you to invest alone. After all, what Boiling Sheep needs most is someone who can push it to go public smoothly. I may not be very good at this, but I happen to be a little skilled in this area. How about I take the majority and you take the minority?"

"No, no, no, you two, don't do this, let everyone get some."

The sudden change in style made Tong Zhelan, who had no intention of investing in Boiling Sheep, make up her mind.

The other students were the same; they wanted to get a little bit of everything.

Is 1.5 million a lot?

They're just so-so; you could easily find a group of these people together.

We absolutely cannot let go of a model that disrupts the entire traditional industry.

Chen Pingsheng hasn't even had the nerve to say it yet, but the thing he really wants to disrupt traditional industries isn't Boiling Sheep at all.

Instead, it's a superstore that's still spending 30 million on research.

That's his ultimate weapon in the traditional industry.

First, create a large marketplace, then break it down into smaller, publicly listed companies.

This is his ultimate plan.

Despite the commotion, Tong Zhelan ultimately secured a 50 million yuan investment share, which translates to 10% of the original shares.

According to her calculations, now that she's involved, Boiling Sheep's valuation should be at least between 15 billion and 18 billion RMB at the time of its Series C funding round.

This is normal; the later ones are several times the number of the earlier ones.

Otherwise, who would want to invest at the beginning? The earlier you invest, the higher the risk.

(End of this chapter)