Cover image |Stills from Big River 3.
Q: Uncle Feng, I am a young man who is starting a business. As the year approached, I also made a summary of the company's growth and my own growth. Looking back on the past few years of entrepreneurship, except that the company has spent a lot of money, it seems that there is not much gain. Financing is not as easy as it used to be. Confused, can you give some advice? What do you think startups should do well? Uncle Feng: As a startup, after a few years, there are four things that must be done gradually. The first thing is to do a good job in the most basic products and services. What do you rely on to make good products and good services? Rely on talent. So the second thing is to have talent. With good people, we can have good products and good services. With talents, with good products and services, what will be the result? Get the improvement of customer satisfaction and the accumulation and growth of the number of customers. If this thing is repeated repeatedly, it will get a good reputation, and then the brand will be formed. This is the third thing. Do these three things well, and capital will look at you. Only then can you do the fourth thing well – financing. If the first three things are not done well, there is no sustainable growth ability, even if there is capital blessing, get money, and solve some problems in a short period of time, after a long time, there will still be a lot of problems that you can't solve, and then the capital will feel that it has looked away before. In the past few years, some startups have encountered problems and said that they have no money. In fact, many of them are problems other than money. I know that some companies have raised 1 billion or 2 billion yuan before, but they are still very short of money. Where did the money go? Instead of spending on the polishing of products and business models and talent training, it was spent on rapid expansion. Why the rush to expand? This is also a negative impact of financing on enterprises. Because capital wants performance, scale, and growth, if you take the money, in order to satisfy investors, in order to make the statements look good, you will be hot-headed, and you will expand with a bang, but in this process, your products, talents, organizations, management and other aspects can not keep up, and there will be problems everywhere, and there will be a lack of money. When we catch up with the changes in the environment, the pressure will come. Therefore, first of all, we must do a good job in products and services, carry out talent training and organizational construction within the company, and then accumulate reputation through products and services. With these three things, the company will not die, there is a high probability that products and services can still be popular, and then there will be positive cash flow and profits, then there will be capital, and then whether it is financing, listing, or mergers and acquisitions of other people's companies in the capital market, it will be valuable.
Q: You mentioned earlier that a lot of startups are facing problems. I saw a saying that less than 7% of start-ups can survive for more than 5 years, less than 3% for more than 10 years, and only 1 in 10,000 are likely to survive for more than 20 years, and most of them are dead. Therefore, starting a business and doing business has a high probability of facing failure. Success is so difficult, is there a secret to increasing the probability of success and allowing the company to live longer? Uncle Feng: I've talked about how businesses move through cycles before, for your reference. We all know that there are cycles in the economy, and there are cycles in the industry. At different points in time, if you can accurately judge the new cycle law, and at the same time have a good understanding of the development trend of the society, and find your own self-consistency and foothold, it is undoubtedly beneficial to the long-term development of the company. Is there a secret to going through the cycle? Two things are important. These two things are also very simple to say, just two words and eight words. The first is to take precautions, and the second is long-termism. Guo Guangchang, chairman of Fosun Group, once said in a lecture at Lakeside University: Any enterprise lives in a cycle, and the cycle is both an opportunity and a challenge. Good use can boost the development of enterprises, and bad use may bring about an existential crisis. Combined with Fosun's situation, he said that since its establishment in 1994, Fosun Group has developed from a start-up company to an industrial group with hundreds of billions of assets in the world. He said that in the process of running a business, it is necessary to make adequate preparations in advance for all kinds of storms that may be encountered in future development. Otherwise, by the time the storm actually comes, the business may be dead. It is very important to go through the cycle of the industry, and the important thing is to cross the cycle of technology, we can only rely on technological innovation to achieve the cycle of technology, so any enterprise must pay attention to technological innovation. Only by taking precautions, walking in front of others, walking in front of cyclical changes, walking in front of future demand explosions, and walking in the front of a trend, can enterprises have the strength to go through the cycle. What is long-termism about? Insist on doing the right thing, insist on doing the long-term thing, insist on doing what others think is difficult to do, and insist on doing those things that need to be accumulated over a long period of timeThis is called long-termism. To achieve this, we must insist on not doing things that everyone else does, and we must dare to judge what is right. I've had some conversations with Jardine Matheson and Hongkong Land's senior management. Hongkong Land has a history of more than 130 years, and its parent company, Jardine Matheson, has a history of 200 years. The company has been through many economic cycles, and they have a very unique set of experience in economic cycles, crises, and financial soundness and rhythmic arrangements. Their view of the market is very interesting, and in a word, listen attentively and do the opposite. There are always many and complex statements in the market. Only by listening attentively can we have a comprehensive understanding of market information and find a basis for our own decisions. What do you do after listening? Do it in the opposite direction. For example, for a long time, many domestic real estate companies are pursuing rapid turnover and rapid sales, and they all believe that the scale, cost and speed of the enterprise are very important. Many ** analysts in the market say so. What to do according to the saying "listen attentively, do it in the opposite direction"? It's about holding the most valuable properties outside of the home. In Hongkong Land's words, build the best quality property on the most expensive land and rent it to the richest people. It's called listening with your heart and doing it in the opposite direction. It turns out that they did it in the opposite direction again and again, and then insisted on long-termism, relying on patience, and won success, and it was a big success. Preparing for a rainy day and long-termism are not only beneficial to the development of enterprises, but also helpful to individuals to solve the difficulties and troubles of life. No matter what kind of work or career you are engaged in, as long as you focus on the long-term, deeply cultivate the value, never give up the observation of the essence of things, do not rely on opportunism, and are not affected by short-term ** and environmental noise, you will be able to withstand the test of time and cross your own business cycle and external business cycle.