Back to the prime of life

Chapter 191 Q&A
Various industry salons are routine events, but Lu Changge usually attends exchange meetings organized by large associations, where invited participants can share their views.

However, the gathering that Lu Changge attended with Professor Liu Wen on this trip north was more like a small-scale gathering, or even one that was funded and organized by one or a few people.

Those who organized it naturally had their own purposes. In fact, Lu Changge also learned that the number of such events had increased significantly since the financial crisis last year.

Perhaps everyone felt the chill and thus huddled together for warmth.

Before the trip, Liu Wen kindly told Lu Changge not to be nervous and that he would get used to it after participating more.

What could Lu Changge say?
I had no choice but to nod.

Upon arrival, he discovered that it was much as he had guessed. This small gathering, hidden in a secluded club, included investors, entrepreneurs, and of course, professors like Liu Wen.

He also noted that there were relatively few investors and relatively many entrepreneurs.

This is a characteristic.

The second characteristic is that although everyone is there for the money, they all put on airs and act like professors, as if it makes them seem knowledgeable and cultured.

Because of this, Liu Wen introduced several mid-level managers who worked at venture capital firms.

These people are quite polite on the surface, saying things like, "Oh, I know, it was reported on TV. This is an entrepreneur who came from a university campus. He's really young and promising."

Others would be simpler, saying, "Teacher Liu has nurtured another outstanding talent."

Such examples are numerous.

It's a pity that Lu Changge is neither a professor nor a big boss, so it's hard for him to become the center of attention in such a large group. The real focus is automatically determined by 'status in the underworld'.

Those who have achieved some success are naturally the focus of this salon.

However, Lu Changge was mainly listening this time, since it was only the first round, and he wanted to see how these guys would handle things.

Once it officially begins, people will start speaking. At this point in 2009, all topics will inevitably revolve around the financial crisis.

He sat next to Liu Wen, listening to several people discussing this issue.

One of the more important figures is said to be a high-ranking employee of Yahoo, who has now left his technical position in China but is doing some investment and consulting work.

When they shook hands, Lu Changge heard him say his name was Stephen.

It's quite something that Chinese people insist on using foreign names.

"We just returned from the United States, and our current feeling is one of utter chill. Some people say the internet industry is different; it still has growth momentum, after all, we keep bringing in new internet users. But the internet industry is also very closely linked to foreign countries; many companies' major shareholders and initial funding sources are overseas, therefore..."

Lu Changge listened while observing the others around him.

A middle-aged man wearing glasses waved at him.

This is someone I just met; they work for an investment firm called Chuangwen Capital.

The bigwigs on stage were talking enthusiastically, while the people below were exchanging contact information. Since Lu Changge couldn't get the chance to advertise for Lu Mang in front of everyone, he decided to start from there.

At least understand how the market perceives companies like theirs.

The other person seemed to be somewhat interested in him, because during the tea break, they came over to him and said, "There's a seat over there, would you like to sit down?"

Lu Changge did not refuse. He would not act like a child and become flustered if he could not see Liu Wen.

"Mr. Xue, please."

The clubhouse has a nice environment with several small sofas for sitting opposite each other. It's quite enjoyable to sit down and have a short chat.

"I have bought clothes from your company before."

This is what Xue Lei said as soon as he sat down.

Lu Changge joked, "You're not here to return the goods, are you?"

The other party laughed and said, "You're too funny. Of course not. I bought it because I noticed that Mr. Lu's company is rising very quickly in Jiangzhou, so I decided to try it out as a customer. But today was a bit of a surprise; I didn't expect to meet its founder here. If Mr. Lu doesn't mind, I'd like to take a few minutes of your time. You only saw him on TV, so your mindset is like a fan seeing their favorite celebrity."

"You're too kind. What would you like to know, Mr. Xue?"

There's no need for further words. Those who are here today are either selling or buying shares. Few people enjoy socializing; most are here out of necessity. "Many of you have probably already asked me these questions, including why Mr. Lu is so young and how Lumang came about. I want to ask a more crucial question: Mr. Lu, what are your views on the future of Vancl, and what is your view on the relationship between Lumang and Vancl?"

That's definitely an investor's mindset.

They have no interest in the so-called visions and dreams that entrepreneurs talk about; what they care about most is whether you can survive and make a profit.

Specifically, what's the solution when you face a strong competitor?
Lu Changge did look a bit young, there was nothing that could be done about it, but his eyes didn't dodge. After a moment of preparation, he said, "To be honest, although I haven't heard this kind of talk much, some people have indeed said it. They say that our company's model is a complete copy of Vancl's. Who told us to start later than them? We can't afford to suffer this loss."

But actually, I haven't responded much to this question because those who question it don't understand the nature of companies like ours. In the internet industry, there's a saying: "winner takes all," which goes without saying. But neither we nor Vancl belong to that type of internet company. In the end, let alone winning the winner's take, we won't even be able to capture 5% of the market.

This judgment surprised the person opposite, as if it were the first time he had heard it. "Why?"

"Because neither Vancl nor Lumang are purely or traditional internet companies. Essentially, we are running clothing brands, just using the internet to do so. And clothing is a highly personalized industry. Mr. Xue, can you imagine an office with 50 people, all wearing Vancl or all wearing Lumang?"

Clothing is about individuality. The saying goes, "It's not scary to wear the same clothes as someone else; it's embarrassing if you look worse." Aside from mandatory rules, what group would spontaneously all wear the same clothes? Does anyone? In other words, it's rare for 10% of a group to wear the same brand. Even if that's the case, the rest will rebel. No matter how good a brand like Vancl or Lumang is, the others definitely won't wear it.

"So, that's what President Lu thinks?" Xue Lei muttered, looking thoughtful.

Lu Changge gave a polite smile.

Investors choose him, and he also chooses investors.

"But even from the perspective of clothing brands, your brand values ​​are quite similar to those of Vancl. Have you considered this?"

Lu Changge said, "It's still different."

"What's the difference?"

"I am younger than its founder, and I am also better looking than its founder."

Xue Lei: "..."

He couldn't even tell whether what he said was true or false.

However, one thing is true: Lu Changge's performance exceeded his expectations. Before meeting him, anyone would have underestimated this third-year student to some extent. Thus, the contrast between his previous and current behavior became apparent.

Not only that, Lu Changge also heard a young woman next to him cover her mouth and laugh, and then meet his gaze and say, "Sorry, I didn't mean to eavesdrop."

"It's alright, this place isn't very big anyway," Lu Changge said nonchalantly.

"Mr. Xue, don't be stunned. I think his answer makes sense. Whether someone is handsome or not is still very important."

Xue Lei said awkwardly, "President Xu, please stop joking with me. We're talking about serious business."

Lu Changge also knew this Xu guy; he was one of the investment managers.

"Okay, that's the important business. Hey, Mr. Lu, can I ask you a question?"

"Please say."

"What do you think is the biggest problem for a company like yours? Just one, I won't go into details."

That's more interesting.

Lu Changge pondered for a moment, "If I had to pinpoint one reason, I think it's because the low-price strategy has resulted in low gross margins for both of our companies, while marketing and logistics costs are relatively high. Whether we can be profitable hasn't been proven by the market. Furthermore, vertical e-commerce will face a downward pressure from general e-commerce, and at the same time, traditional apparel brands will definitely move online. Under this double whammy, the time we have left to build our brand power and cultivate a loyal customer base is very limited. As of now, I don't know if our competitors have realized the second point, but they seem not to have realized the first one."

Mr. Xu and Xue Lei exchanged a glance; they knew for sure whether what Lu Changge said was truly valuable information.

Mr. Xu pressed further: "Are you worried that the profit margin might actually be small?"

Lu Changge stopped there, saying that they had only met once and were not particularly close.

Because once a company can no longer make a profit, the only remaining option is to pass the buck, taking advantage of a surge in the company's various metrics to estimate a price and sell it off.

But if you can do this, it's a voluntary transaction. If you buy it and lose money, who can you blame? What if it's because you didn't manage it well?

I just can't say it now, because saying it would be deliberately trying to trick people.
So he fobbed him off by saying, "Fear won't solve anything."

The man surnamed Xu didn't find fault with what he said; on the contrary, he was very interested in him and even came over to exchange contact information.

(End of this chapter)