Some Suggestions For Entrepreneurs

A few days ago, I participated in the 2007 China venture capital medium term forum, chaired a special discussion. Like other similar conferences, many entrepreneurs and friends exchanged business cards with me, and even gave me a neatly arranged business plan, and I talked about the specific content of the project.

Because I have some arranged things below, and there are usually some investors or colleagues from our fund who will discuss some problems during the meeting, so I do not have much time to stay at the venue and communicate with entrepreneurs. Many times I can only say hello briefly, or just change business cards.

I feel a little sorry, because I understand that entrepreneurs are rushing to various situations in order to finance their enterprises. They take the initiative to know investors, introduce their own mood, and even be moved by their persistence.

However, although I know that the goal of entrepreneurs is to melt into the capital and make the enterprises bigger, but from the bottom of my heart, I think many entrepreneurs just exchange business cards with VC in the conference, and hastily chat a few words, which will not have much effect on the financing and development of enterprises.

I think on the one hand, entrepreneurs may not know enough about the significance of participating in such venture capital conferences. On the other hand, they do not have a good grasp of the way to communicate with VC.

I seriously thought about it, summed up some of my own experience, hoping to be a little bit useful for entrepreneurs.

It may be that I am not necessarily right, and you may not like it, but I still insist on telling the truth.

1. strives to gain the greatest benefit from the investment community conference. The topic is from the venture capital conference. I want to talk about my views on the entrepreneurs' participation in the conference.

Like this venture capital conference, the scale is relatively large, almost all the active VC in China will participate. At the same time, there will be many successful entrepreneurs, especially entrepreneurs who have been supported by venture capital.

Therefore, such meetings are valuable to investors and entrepreneurs.

According to the role of entrepreneurs, I think it can be sorted in this way: a understands the environment of venture capital.

There are special research reports to analyze and summarize the total amount of venture capital in China, the distribution of investment industry and exit situation in the past six months or one year.

In addition, the issues discussed by the guests at some special venues are often the issues of general concern at present. For example, the six ministries and commissions jointly issued by the Ministry of Commerce, such as the regulations on mergers and acquisitions of domestic enterprises by foreign investors, the establishment of RMB funds, the withdrawal of domestic capital markets, the investment fields currently focused on by investors, and the main opportunities and risks of different investment fields.

Through the understanding of these macro situations, entrepreneurs can clearly define the development trend and financing situation of their industries, so they can have a general idea of the prospects and financing difficulties of their enterprises, and communicate with entrepreneurs through B.

From the perspective of the development of enterprises, the experience sharing of successful entrepreneurs can be more enlightening than those of investors who are starting a business.

Every time this kind of investment conference will usually invite some successful entrepreneurs, such as Focus Media Jiangnan Chun, Shao Yibo of eBay network, and the Ctrip invited by this conference, Ji Qi, one of the founders of the family, Zhang Guolun of sports 100, has rich experience in the operation of enterprises. Many times, though different in industry, they are connected in experience.

In addition to discussing common problems in the development of enterprises, venture entrepreneurs who have been supported by venture capital can also listen to their views on the role of venture capital in the development of enterprises.

I remember last time I took part in an activity of the entrepreneurial organization - "from 20 to 200 people, how to cross the ridge", many entrepreneurs participated in this meeting and shared some valuable experiences. For example, Zhang Xiangdong of 3G portal said he thought that the most important thing to do is to attract talents. He recruited their COO, spent 5 months, and kept sending him an email for "5 months" to report the progress of the company's business. Finally, he moved COO to resign from another city and earn a stable salary.

And this man is Zhang Xiangdong's roommate at Peking University.

Such experience can often arouse the resonance of entrepreneurs, and will have some enlightening effect; C and VC exchange.

I put the VC communication in the last place because I feel that the time between investors and entrepreneurs in the investment conference is not enough. It is hard for investors to listen to a certain project carefully, or at least I do.

If entrepreneurs really want to talk to investors, I suggest that they talk with investment managers or analysts, and they have more time.

Every time our company has 1-2 investment managers to attend such a meeting, I think other companies will have it.

The organizers of the conference are generally familiar with the investment managers of VC, so they can be found by the organizers of the conference, of course, they may also encounter directly.

A more comprehensive approach to VC is to find financing consultants. They are familiar with VC companies, including areas of investment, investment stages and investment scale.

If the entrepreneur's project is good, there is no need to worry about contact with investors. I think VC is basically providing services for enterprises, including capital and value-added services.

Finding VC is not that difficult. Many people find it difficult to find VC. In fact, it may be because the attraction of the project itself is not enough, so VC will prevaricate with various excuses.

Of course, there are some cases that investors may not know enough about this field, or the project is too professional to understand, so they dare not vote.

2. knows how to respect other people's time, and VC exchanges to seize the key points. We have many meetings with entrepreneurs, listen to their introduction to the project, and find that many entrepreneurs talk about their projects and talk about what they want to hear, which is a waste of time for both sides.

The "others" mentioned in my title does not refer to VC. alone. Sometimes, our company arranges several meetings in an afternoon. Each meeting will take about half an hour to 40 minutes. We will talk with the entrepreneurs in advance.

Some entrepreneurs are very punctual, put the table on the table, effectively control the rhythm of the speech; some entrepreneurs, we remind the time, or continue to add, this mood we fully understand, but from another perspective, how long the front people dragging time, the people in the back will have to wait for you longer.

Moreover, we generally do not change our overall impression of the project because of several additional points, because half an hour can fully list its main strengths.

If we think that a project is consistent with our investment philosophy, there will surely be more communication next.

However, entrepreneurs sometimes get a little nervous about dealing with VC, especially when they have not been in touch with VC before, nor do they know what the other person cares about.

Here, I list the issues that I care about when I look at the project. The next time you talk to me, you can go straight to the theme: what do you do (main business, business mode)?

It is best to generalize in one or two sentences, which is often a strategic position of an enterprise.

If entrepreneurs say a lot in this regard, I will habitually sum up as a saying: "can your enterprise be positioned like this?"

How to make money (profit mode); the income and profit situation of the past 1-3 years (if any) and the financial forecast for the next two years, the growth of business, and whether the core competitiveness of the company is (team, technology or other), and whether the core competitiveness is sustainable.

Market competition pattern.

4, how big will it be in 5 years? Is there any possibility of going public?

Every item can be expanded, but too many descriptions are not very meaningful (such as the market). I hope that entrepreneurs can speak clearly in a few words, especially the location of the company, the simpler the better.

I often interrupt entrepreneurs, which is a bit impolite. This is related to my character. I speak very directly, and I want to grasp the key quickly. I hope my friends will understand.

3. to set up a correct financing mindset part of the main point I want to explain is that entrepreneurs can not take VC from money to money as a criterion for deciding whether or not an enterprise can succeed.

An excellent venture enterprise, with the support of VC, will develop faster. Without VC's support, it can develop itself, but it may be slower.

VC as a financial investor, although it will help the development of enterprises, this kind of help is only supplementary. The development of enterprises can only rely on their own efforts.

We reviewed two projects that we did not invest in.

One is the early stage of the project, which is not mature enough for us.

Some projects may be more suitable for angel investment or angel investment, but it will take a period of time to prove that the business model is feasible, the team execution capability is strong enough, and the growth rate is fast enough.

Many entrepreneurs in their own enterprises have not yet been verified in the situation, began to rush to focus on financing, which often has two kinds of results, one is that the enterprise does have some potential for development, VC voted, but the price is very low; the other is unable to finance.

I suggest that such enterprises must pay attention to the development of their own businesses. When you develop to a certain stage, if it proves true, financing is very easy and the valuation of enterprises will be relatively high.

The second category is that the price of the project is too expensive.

Many projects do have good prospects for development, but when investors are looking for investors, the price is the standard of choice. We think this is an incomplete attitude. Entrepreneurs do not view the development of enterprises from a long-term perspective.

In fact, there are many intangible resources for VC to offer to start-ups, and many resources are difficult to measure with capital.

Therefore, when choosing VC, entrepreneurs should have a thorough understanding of each company, including their investment style, the industry distribution of investment companies, and the help provided to the invested companies.

Another point is that the amount of financing is not the more the better, because too much financing will be idle, only to dilute the role of entrepreneurs share.

Entrepreneurs should have a detailed plan for the demand and utilization of funds, and can finance in stages according to the development of enterprises.

It is certainly a good thing to integrate money into money.

Temporarily not melt into the money, nor does it mean that your project is not good.

If you feel your thoughts are right, do it firmly. If the business really gets up one day, VC will take the initiative to find you.

Of course, whether or not there is VC investment, I suggest that entrepreneurs and investors maintain good relations, even without investment cooperation, from the perspective of friends, the two sides can also make some suggestions for each other.

4. has been trying to find the demand, not follow suit, and do the best in his own field. He read an article in the entrepreneurial state. It was said that Ji Qi, who was a founder of the family, such as the founder of the family, Ji Qi, when he was doing Ctrip, found that the price of the hotel which was reflected on the Ctrip online was too expensive. After investigation and analysis, he realized that he had the chance to be a home.

I think his success is largely due to the in-depth discovery of market demand, which is based on experience accumulation. It is hard for outsiders to come out. Even if you are not professional, you may not notice the demand and turn it into a cause.

This is also one of the important reasons why venture capital pays attention to "human".

There are many examples in our investment companies. Lu Chen, founder of panoramic pictures, graduated from the University of astronomy and physics in Beijing and graduated from the publishing industry. He sold books and calendars. In the process of publishing business, he found that the supply of high quality pictures had an important impact on publishing enterprises. He founded panoramic picture company and learned from the experience of the world's leading companies. He fully borrowed the power of the Internet to enable the company to develop rapidly in a short period of time and become the largest picture supplier in China.

DavidLee, the founder of EditGrid, an online spreadsheet company that has just invested this year, has only twenty in Hongkong. In the past few years, it has just done IT outsourcing for some large companies. In the process of doing business, customers have put forward the demand for online sharing of spreadsheets, so that employees of the company can edit and update the same document in different parts of the world.

DavidLee