Unicorn Hits 25%: The Education Investment Methodology Of Ching Song Fund

"The founders from 0 to 1 need recognition and fighting ability for the industry. If we want to go to the end, we need to see the character and pattern of the founders. " Seven years after entering the field of education investment, Dong Zhanbin, founding partner of the song song fund, concluded.

Ching song foundation was founded in 2012, and the team is famous for its ten thousand hour research and stable and ruthless style. The team has managed 4 RMB funds with a total scale of 2 billion yuan, and invested nearly 170 start-ups in three major fields, including culture, education, consumption, innovation, technology and application. Among them, the representative cases in the field of education include head education, squirrel AI, onion Institute and so on.

Up to the end of April this year, four of the 16 invested enterprises in the education sector have been among the unicorn enterprises, and the average annual value added of investment projects has been 500%. In the representative cases of many education fields, the fund was the first investor of external organizations.

In May this year, Dong Zhanbin, an exclusive interview with the economic report in twenty-first Century, focused on the investment logic of the education fund, the observation of the education market, and the suggestions for the current entrepreneurs.

The new crown pneumonia epidemic has accelerated the penetration of the online education market, but competition among various track companies is also increasing. Dong Zhanbin believes that education start-ups should also pay special attention to the development of curriculum and system while acquiring new traffic, and make more active cash flow management and business adjustment layout from the overall business level of enterprises.

25% behind the unicorns hit rate

In early 2019, the head office announced the completion of the E-1 round of $350 million in financing, setting the highest single financing amount for the K12 online one to one general counseling course.

The first financing of master education is the investment of hundreds of thousands of angels in the song song fund. At that time, the head education was also known as "the new leader of the Department". Under the support of the fund, the company officially launched the national business layout, and on the other hand, started online business expansion.

Like the investment in education, it is the company's earliest external investment investor in half of the educational programs, such as head education, squirrel AI, answer and distance education.

The early investment gene of the founding team of the pine fund can be traced back to the end of 1990s. Liu Xiaosong, founding partner of the pine fund, is the first angel investor in Tencent. He founded the pine fund with Su Yu and Dong Zhanbin as one of the earliest institutional angels in China.

Ching song fund from the 2014 two phase of the formal layout of the fund in the field of education, creating a "100% success rate, the average annual increment of 500%" record. In an interview with the economic report reporters in 2017, Liu Xiaosong attributed the achievement of the pine fund to the insistence on "10000 hours research": "on the basis of in-depth industry research, it is" half an hour ahead of the market ".

In this interview, Dong Zhanbin added that the winning rate of the song song fund also benefited from the judgment of "people" and "things" and the final thinking that was ultimately made. He cited investment in education at the head office, for example, when he was impressed by the founding team of the company because Zhang Yung mentioned "one to one is simulating the offline scenes and moving the education services to the online industry, so that large-scale revenue can be generated".

In the view of the song song fund, the subdivision of the online education sector will eventually be dominated by a head office. Nowadays, the head effect of online education industry has become more and more obvious. The performance of listed education companies in their respective main areas also confirms this point.

The new fund covers from angel to B.

Since 2014, Ching song fund has stepped into the field of educational investment, and the investment stage is still concentrated on angel wheels and A wheels. In 2017, the song song fund and StarVC jointly invested the B round financing of the mathematical thinking project onion Institute, which became the earliest B round investment project of the song song fund.

The investment of Qing song fund in 2019 can be found that the team invested about 300 million yuan to 20 projects, of which 85% of the project financing providers and investment stages of funds have also covered many stages from angels to B rounds. In addition to the comprehensive main fund, the team also set up a science and technology theme industry fund with a scale of 300 million yuan.

According to the twenty-first Century economic report, the fourth phase RMB fund raised by the fund will focus on the two areas of new consumption and new technology and application. Investment in culture and education will be carried out from two angles of technology and consumption, and the investment stage will remain from angel to B.

For VC investors, the market downturn is a good time to launch. In 2019, when the domestic VC fund raised and invested twice, the investment volume and total investment of the fund were all on the rise.

Speaking of the domestic venture capital market in 2020, Dong Zhanbin thought it would be a trend to suppress first. That is to say, in the second half of the year, the impact of the epidemic will be weakened and the activity level of the two tier market will continue.

Specific to the investment in the education sector, he said, the team is paying attention to the subdivision track including vocational education and quality education, and hints: "the past 80 points of the project investors voted, and only now we can see the bright spot to get investment."

In Dong Zhanbin's view, the competition of online education tracks is the competition of comprehensive abilities, including the new technology application including AI, VR and AR, and the channel change including WeChat ecology, which is bringing new possibilities to start-ups.

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