Placed in the new track of urban competition, Changzhou has a layout and gathers sand into a tower, which will build the real economy based on manufacturing into a super trump card.
However, in terms of area and population, Changzhou may not have an advantage, but the city has always adhered to the road of "industrial prosperity", relying on its location advantages to stand out from the encirclement. Located in the geometric center of the Yangtze River Delta, Changzhou has the unique advantages of "one point in the center, two belts linkage, cross crossing, rice word intersection, and left and right sources". Changzhou has also taken this advantage to the extreme, positioning itself as the "hub of the central axis of the Yangtze River Delta", placing it in the development map of the Yangtze River Delta, that is, connecting the east to the west and connecting the south to the north.
The key to Changzhou's success is naturally inseparable from the industrial spirit and foundation that have been precipitated over the past century. Changzhou has a relatively complete industrial system - 37 of the 41 major categories of industry, 191 of the 207 medium categories, and 605 of the 666 sub-categories. Because of this, Changzhou has taken advantage of the trend of industrial revitalization, seized the tuyere of photovoltaics, power batteries and new energy vehicles, reshaped the urban matrix, and injected strong impetus into industrial development.
However, in the face of the development and changes of the global economy, China's manufacturing industry needs to take the initiative to meet opportunities and challenges, and how will Changzhou further change and innovate? At the end of January, Matrix Partners held the first Matrix Partners Convergence in 2024 in Changzhou City (Wujin District), the "Dragon City", and Zhang Chao, Managing Director of Matrix Partners, delivered a keynote speech on "Investment Logic and Prospect of Intelligent Manufacturing Industry".
At the beginning of the speech, Zhang Chao started with "How to break through made in China?" This question was cut into, and then talked about the understanding of new infrastructure and new quality productivity, as well as Jingwei's investment strategy and differentiated advantages in the field of intelligent manufacturing. Following, enjoy:
From 2023 to the beginning of 2024, both entrepreneurs and investors here have felt the increase in uncertainty in the industry, which requires us to judge the general trend objectively and calmly.
Today's investment is very different from a few years ago, in the past, you could use a simple pre-IPO investment logic, for example, once a company's income and profits, if you meet the review criteria for listing, you can apply for listing, which belongs to the dividends of the times. Everything was different after 2019. Whether it is an investor or an entrepreneur, there is a question to think about:What is your perception of this era and the company?
How can Made in China break through?
To answer this question, we need to start from the four dimensions of the world, China, industry, and enterprise to understand what cycle stage these four subjects are in? From macro to micro, entrepreneurs must first understand their own environment and their own points in order to better analyze your opportunities.
Looking at the first big question from a macro perspective, what is the situation facing the world and China? It can be seen that the world economy is undergoing major changes unseen in a century. In recent years, we have often heard words such as technological revolution, AI and chip computing power, etc., which are familiar to us every day, and the keywords that accompany us may be related to today's investment and entrepreneurship trends.
China's economy, on the other hand, is characterized by both challenges and opportunities. In China, the output value of China's manufacturing industry can reach one-third of the world's, which is the world's largest industrial output value and has the world's most complete industrial categories. Before, we went to the United States on a business trip and learned that it takes two to three weeks to make a mold for a product in the United States and mail it to China, but in Shenzhen or the Yangtze River Delta region, it may take three or four days to solve your problem. Because of this, it took China more than 30 years to complete the centuries-old historical process of developed countries.
But there are also a lot of problems, and that's what we're facing today. We have not yet mastered the pricing dominance in many industry chains, and we still lack world-renowned brands. As everyone knows, although a number of domestic substitution forces have emerged in the fields of semiconductors, industrial software, high-end equipment and parts, Chinese companies are still facing the dilemma of being stuck, especially the production of some high value-added and high-tech products may still be controlled by others.
As the saying goes, first-class products need first-class equipment and materials, and first-class products also need first-class scientific instruments. We have done statistics that there is not a single Chinese company among the top 20 scientific instrument companies in the world, and China is the third largest scientific instrument market in the world. So, we can't be complacent, we still lack a lot of things.
Looking at the problems we are facing today from a macro perspective, what will we do in the next ten years? What are our competitive industries? What are our shortcomings?
Changzhou's advantageous industries are obvious. Changzhou is relatively strong in new energy, photovoltaic, lithium battery and other industries. What needs to be done in the next decade is to extend our longboard, and we should continue to work in these areas. However, there are still many shortcomings in the field, in semiconductors, large aircraft chains, robots, high-end CNC and laser equipment, we still lack relevant high-tech products.
The national policy is the vane of our investment and entrepreneurship, and we hope that everything we do today will be at the same frequency as the national industrial policy. Mr. Zhang Ying once said that in the next ten or even twenty years, the largest and most powerful companies must be companies that are at the same frequency as the national industrial policy and the development of the industry. Today, we need to fully analyze the relevant policies launched by the state, such as:New infrastructure and new productivity
Everyone is familiar with these two terms. The term "new qualitative productivity" has not been coined for a long time, and I will explain the words "new" and "qualitative" separatelyWhat's New? On behalf of the future, you have to use new production tools, face new service objects, and face new partners, these new means that the things you have to think about and the business you want to do today will change, and you need to reposition your customers, businessmen, and competitors. There is quality only when there is newnessQuality is the cutting-edge productivity and forward-looking technology in the futureOnly the drive of core technology can bring continuous growth to our enterprise.
Again,With the improvement of new quality productivity, there will be new demand for new infrastructure. Because new quality productivity requires more new energy sources, the further improvement of new infrastructure will in turn promote the development of new quality productivity. Therefore, after seeing these big situations, all the thinking logic of Jingwei Intelligent Manufacturing should be established in the next 5-10 years. In this way, you will not be entangled in whether your investment today can produce results in a year or two. In the specific process, you may still invest early, resulting in you not being able to survive before dawn, or you may not be able to grab the best investment time if you invest late. However, as long as we see the general trend clearly and start with the end in mind, it will better help us balance the mentality and process nodes when investing.
How does Jingwei invest in the field of intelligent manufacturing?
Specific investment areas, high-end equipment, core components, industrial software, each track is very difficult to invest in today. For our team, we are now focusing on three main areas:
The first one is:RobotsRobotics is one of the largest and forward-thinking industries of the Fifth Industrial Revolution. With the development of large models and continuous iteration, we believe that the robot industry is a new quality productivity that is very in line with China's future megatrend. In the face of the shrinking labor force population and the urgent need to launch new productivity, general robotics may be one of the most important industries in the future.
In this field, the warp and weft should be one of the earliest layouts in the head. In the past year or so, we have invested in three general robotics companies in a row, including Zhiyuan Robotics, Unitree Technology, and Galaxy General Motors.
Our criteria for selecting these three companies are:
First, we must look at the combination of software and hardware. The software and hardware of any robot cannot be separated, and a single technology is likely to face disadvantages in the subsequent competition; Second, there is no engineering capability for low-cost, high-volume manufacturing. The ability to engineer is something that many startup teams today do not have, which means that the team cannot copy the product in large quantities at low cost; The third is a large model, which is equivalent to the brain of a general-purpose robot, but the technology is not yet sufficiently convergent, and there are many uncertainties. Therefore, we are more inclined to choose the iterative ability of the open source large model first, and simultaneously develop our own deep cerebellum, and finallyThe brain and cerebellum must be the embodiment of the core competitiveness and differentiation of the robot company.
At the same time, we are also paying attention to some important components of the robot industry, the future of robots not only need to be more intelligent and interactive, but also have stronger endurance, motion obstacle avoidance, and human-like mobility. Therefore, all the core components may change, and we will invest resources from the most important and highest-cost parts to find and assist entrepreneurs in their work.
General-purpose robots are not efficient in solving all scenarios, so specialized robots have more suitable scenarios. In the field of special robots, what kind of scenarios should we pay attention to its downstream applications? How much is the real demand for these scenarios? How much will be capitalized in the future? How fast is the growth rate? These are the most important questions we ask when choosing a product category.
In today's general situation, if the investment scale of the downstream scenario is not high enough and not large enough, it is actually difficult for you to obtain enough market space, and it is difficult for such a company to achieve a fast growth rate.
In our investment map, there is also Langxin Intelligence, a professional furnace robot manufacturer around heavy industry and high-risk scenarios, because the emergence of the company's products can allow ferroalloys, industrial silicon and other factory furnace workers who use electric furnaces to reduce their work intensity and even avoid personal injury, which is an important protection for every family. So what we do, we want it to have both economic and social effects.
Second,In the field of equipment components and materials. Time is limited, we just want to talk about the big logic, we think it is a very important thing to start a business and invest in the future, that is, the technology you do is a generational technology. In the past three or four years, we can hear about stuck necks and domestic substitutions every day, but this matter is after all substitution and catching up. But when will we be able to transcend it? For early-stage investing, we want to invest in companies that can go beyond, we want to find different founders, and we want to provide personal care through our various enablements, and founders can make products that are intergenerational. Generational products are what we have been pursuing. We hope that in Changzhou, China, and in the Yangtze River Delta, there will be many intergenerational companies like Silicon Valley, which is something that Jingwei deliberately pursues in investment.
In addition, in China's domestic market to make parts, many products have a market space of no more than two or three billion. If it is listed, it is expected to have a market value of two or three billion, which is a relatively low ceiling, and it is difficult to become a multinational or large-scale company with a very large volume. Our thinking is, if your potential market space is low, how to solve this problem?
What we need is founders to haveSufficient cross-border capabilitiesThis cross-border refers to whether your product has the ability to be horizontally productized, such as from product A to product B, from product B to product C; The second thing is that you have the ability to cross industries, if you do consumer electronics today, such as making mobile phone ** chain products, the mobile phone industry will easily produce 100 million units, this industry chain pursues innovation and low cost. So, can entrepreneurs use the product power in consumer electronics to cross over to other industrial fields?
We now see that some industrial camera brands use consumer electronics lenses and sensor chips to make industrial cameras, and the cost is less than 50% of the cost of the original industrial camera, which is a demonstration of cross-border capabilities; The third thing is vertical integration, which has further integration of your upstream and downstream to improve your market space. Finally, doing business in China is just a small step for you, and hopefully the companies we support can go abroad and go overseas, which is our main focus in terms of parts and equipment.
We have two main approaches to the selection of new material tracks**One of them is high barriers and stuck necks。This is our basic requirement. For many new materials in the field, the higher the value-added products, it is often limited in terms of dosage scale, so we attach more importance to its chemical fundamentals. Second, if you have a chemical base, then you want itThere is a basic platform-type technologyWe hope that the core new materials developed can not only be used in the semiconductor industry, but also extend to pan-semiconductors, which we should focus on in the field of material selection.
Finally, let's talkIndustrial software。Jingwei has communicated a lot with many national teams in industrial software, and we have made a detailed combing of the industry's basic framework, and we have indeed continued to make efforts in this field.
When we select a project, we have different criteria at different stages of the project. If the project is in the early stage, we hope that the founders will think clearly when they start their business, the company's products are not only benchmarked against a certain foreign product, but also hope that they are forward-looking enough, facing the new needs of China's new infrastructure and new quality productivity, have seed user resources, and can cooperate with seed users to develop products that can truly solve the digital pain points of the future industry.
At present, various national policies are advocating intelligence, digitalization, new energy, and green. In the final analysis, the improvement of digitalization must not only have data and computing power, but also be able to develop its own industrial software in combination with the characteristics of industrial development. China's industrial software has been supported by the national policy for no more than 5 years, and overseas industrial software has been developing naturally with the industrial iteration for 70 or 80 years, and we want to surpass others in just a few years, which is unrealistic. Therefore, we should make some products that are in line with our next-generation productivity according to our own industrial characteristics and national conditions, which is the logic of early investment.
In the growth period, we focused on screening more than 20 important software product categories released by national competent authorities that urgently need to be solved. From R&D and design tool software, manufacturing software, and basic software, such as databases and operating systems, we will pay attention to the satisfaction of its scientific and technological innovation attributes, and also pay attention to the size of its market space. More importantly, we have to see whether the founder is chasing hot spots or doing a long-term and difficult thing for ten years, we have now invested in the growth stage of industrial software companies, the founders are basically ten years ago in this field of entrepreneurship, we prefer to choose the founders with firm and tenacious quality, we hope to grow together with them.
In terms of post-investment empowerment, Jingwei has invested in seven or eight companies in the field of industrial software, because the product lines of each company are not the same, but the customers they serve are roughly the same, and the main solution is the R&D, manufacturing management and other needs of the eight key industries and manufacturing companies. And can sink to the establishment of cooperation between sales CEOs in various regions. Therefore, Jingwei hopes that through a systematic layout in the field of industrial software, we can have a table of meals, which everyone can take care of, huddle together for warmth, and can also respond to requests. We've been doing this for a long time, and we're going to continue to do it in the future.
The investment logic of Jingwei
To summarize the overall investment logic of Jingwei, first, the industry dimension. See the macro clearly, see the trends around you, and understand your own industry. In today,Industry awareness is extremely important.
I just mentioned intergenerational products, how to define a product is a real intergenerational product, and each founder is different. If you define it precisely, and you are a little more determined, you may be one step closer to success. But the starting point is wrong, and this intergenerational technology is meaningless even if it is forward-looking. So today, when we look at the industry dimension, we should not only look at the development cycle of the industry and the expectation of capitalized investment, but also look at the founder's understanding of the industry.
Clause. Second, the founding team dimension. When it comes to the founder, in addition to the above content, he should also put forward some harsh or targeted requirements for his work background before starting a business. We hope that the founders will not only come out of the industry and universities, but also be industry veterans with industry insight and ability, and at the same time match the founding team with outstanding engineering capabilities. In this way, when the company launches its products, you can have a certain ability to predict in the face of the possible extreme involution in China, and make action arrangements earlier than others. At the same time, it is hoped that entrepreneurs will have the ability to build product matrix, cross-industry application, mergers and acquisitions and overseas capabilities, and in short, strong comprehensive cross-border capabilities.
Clause. Third, the dimension of the company's target. The company dimension is nothing more than some basic investment criteria. Strong technology iteration ability, and the underlying technology has the potential for expansion; The product has passed the test and is ready for mass production, and has a strong commercial growth expectation; Deeply bound to downstream key customers or have strong channel expansion capabilities. Before mass production, the results of the company's seed user testing, coupled with the overall evaluation opinions of customers, are some of the main assessment points above the investment criteria for the projects we select today.