The Logic Of Capital Flows From IPO To The US

The distributed long rental apartment service green house recently submitted the F-1 prospectus to the US Securities and Exchange Commission to raise US $100 million for us depositary shares. Compared with the head enterprise, egg shell apartment, green guest advance one step, or will become the first long rental apartment listing.

Jin Guangjie, a legal representative of green guest, started investing when he was a lawyer. At the beginning of his establishment, he made sure that the company would invest in the next step according to the requirements of the listed company. He regarded it as one of the secrets of success.

Why is the green guest?

Fang Dongdong founder Quan Lei analysis, green guest introduced Morgan Stanley, for its listing in the United States is very helpful, in the United States capital market, underwriters play a very important role.

Compared to other apartment brand financing, loss gradually expanded, green passenger small walk quickly, the amount of financing is not large. According to people familiar with the matter, after the establishment of green guest, the rhythm of financing every 8-9 months was maintained. The latest venture capital was April 2018, and Kaixin capital and Tai Mo invested $100 million. Even in the US, the scale of financing is only about 100 million dollars. Green passenger has no one-time financing dilution stake, Jin Guangjie directly holds 30.3% shares, Kaixin capital and its related entities hold 28.1%, the largest institutional investor. NVC ventures, Sai Fu investment fund and Morgan Stanley managed private equity funds hold 9.3%, 8.9% and 8.9% shares respectively.

"This expansion path is more sophisticated than the chain family and eggshell." Quan Lei disclosed that the green guest may complete the listing in December this year.

However, due to the use of rent loans, green customers inevitably produce disputes. Many accounts of green guest tenants are posted to complain about the poor quality of their decoration and the issue of non refunds.

Quan Lei pointed out that the business mode of green guest is relatively mature. Outside rumors, total assets 2 billion, liabilities 2 billion 700 million. The loss is too big to go up to the market.

Earnings paradox: false start IPO financing

Green passenger prospectus shows that the tenant positioning is relatively young, which is in line with the layout of the city. By the end of 2012, there were 940 rental houses in Shanghai. As of December 31, 2018, green customers covered 6 cities, including Nanjing, Suzhou and Hangzhou, with a total of 91234 houses. The growth is mainly from second tier cities.

In 2017 and 2018, the revenue of Qing Ke apartment was 523 million yuan and 890 million yuan, up 70.3% over the same period last year. From the perspective of income structure, rental income accounted for 97.35% and 89.55% respectively. As of June 30, 2019, the proportion of rental income in total revenue fell to 88.29%, and value-added services accounted for nearly 12%.

Value added services come from broadband network, public affairs, green customer preference and landlord or tenant compensation. This has to mention a lot of rental loans used by Qingdao customers. Many tenants reflect that the general tenancy is 1 years, but Qingdao will let some tenants sign a 26 month lease contract and handle 26 month installment loans. Otherwise, tenants can not enjoy the "reduction of one month rent, water fee broadband fees" discount.

Most of the houses are located in remote areas. Prospectus disclosed that as at the end of June 30, 2019 9 months, the average monthly rent of the green guest apartment is 1149 yuan. Some investors revealed that, on the basis of decoration and furniture purchase, the cost of a room was about 15 thousand yuan to 20 thousand yuan, and the difference between the rent and the rent was not very high, and the investment return time was longer.

In 2017 and 2018, the net loss of Qing Ke apartment was 245 million yuan and 499 million yuan. Over the past 7 years, the total deficit has reached 2 billion yuan. Can such a business model last?

"In rush time, no listing is likely to fail. If the free and eggshell is listed first, the green guest will be very passive. Quan Lei said that the reason why he chose to start in October 2019 is that free and eggshell has come out in preparation for listing.

Green guest listing also has a big background: 2019 is a troubled time for the dispersed apartment brand, and the industry takes the initiative to shuffle. For example, when Hangzhou became a disaster area for the apartment, after the failure of the Lok high "low rent" mode, there was also a funding problem for the customer apartment, and eager to find new buyers. At the same time, there are three or four parents rent apartment brand money problems.

Reporters combed public information was informed that from 2018 to the end of August 2019, 26 parents rent apartments brand crashed, only in July 2019, 6 parents rent apartments exit. Such as Nanjing jade Heng apartment, Xi'an Wan nest, Hangzhou leisure residence, Hangzhou speed Jin real estate, Nanchang Cheng Yu Property and so on. As the industry has said, long rental apartments, shuffling time will be relatively long, at this time, if a successful listing, the industry has a positive role in promoting.