Mobike, how far can it go? (Turn)
"Bike sharing" has a very clear profit model from the very beginning, deposit, which is an incomparably genius innovation. However, this article still raises 5 problems that Mobike is facing now, and how far can the business model of "sharing bicycles" go?
one
A classic story from the venture capital world:
The local tyrants selected their girlfriends and gave each of the three candidates 100 yuan, so that they could fill an empty room with the least amount of money. The first girl bought a lot of cotton and barely filled half of the room. The second girl bought a lot of balloons and filled two-thirds of the room. The third girl, Bingxue, was smart. She bought a lot of candles for a small amount of money, and the warm candlelight instantly illuminated the whole room.
The local tyrant finally chose the one with the bigger breasts.
On a blind date, a man will talk to you about feelings, life, and ideals, but what he values most is actually the chest. I am a venture capitalist, and I have met quite a few entrepreneurs. I will also talk to them about feelings and social values, the character of the founder, and the composition of the team, but when I finally decide whether to invest or not, I actually Just look at one point: the business model.
Chinese people are afraid of poverty and have been restrained for too long, so once the environment permits, the enthusiasm of all people to start a business will be unstoppable and grow wildly in the land of China. But the vast majority of entrepreneurs do not actually think clearly about their business model, so most people's youth is actually just blinded and pulled by hormones and dreams of getting rich, and wasted on the difficult and dangerous road of entrepreneurship.
The business model is actually a chain-like system. A good business model innovation requires at least the following five core issues:
1. What needs are the products (or services) you plan to provide? In other words, who is your target audience? Just need, or improvement? High frequency demand, or low frequency?
2. Is the market for this demand large enough? If it is a small market, it is not a business, but a livelihood;
3. Your mode, whose cheese will you move? In other words, how big is your potential enemy? This determines the friction coefficient and resistance of your business, and also determines how far you can go in the end;
4. Is your model not easy to be copied or copied?
5. Profit model - this is the most, most, most important. Simply put, how does your business model make money? Any business model that does not consider making money is a hooligan. But if you play a rogue (of course, not illegal) can solve the problem of making money, I don't care if you are a rogue or a gentleman. If I ask an entrepreneur about his profit model, if the answer is that I haven't considered this, I will now consider burning money to become a user and grab traffic, and I will maintain enough respect and distance from him;
The most awesome innovation is undoubtedly technological innovation. However, Chinese people who start businesses like to be opportunistic, can’t stand loneliness, are reluctant to invest in technology research and development, and are unwilling to wait, so 99% of them are purely business model innovations—everyone’s entrepreneurship is actually a business model.
Therefore, there is a famous saying in the real estate industry: a house, in addition to its location, is also a location. There is also a summary of experience in the Chinese venture capital community: projects, in addition to business models, are also business models.
two
In my more than ten years as a venture capitalist, I have seen countless smart business model innovations, many of which are eye-catching, but very few are amazing.
Without it, it is because there are few models that answer all the above 5 points. Generally speaking, if you can answer 1, 2, and 3, it is a pretty good project. Those who can answer 1, 2, 3, and 4 are top-grade items. If you can answer 1, 2, 3, 4, and 5 at the same time, you can call it "the most awesome", and it is a top item.
If I want to choose the most innovative business model in China in the past 7 years, I would prefer Lei Jun's Xiaomi. He was the first to use hardware to build the Internet, acquiring users (flocks) at almost unprofitable dumping prices, building an ecosystem, and then looking for "pigs" to pay for it - that is, Lei Jun's famous saying: The wool comes from the pig.
There is no doubt that the smartphone market is large enough and there are enough price-sensitive diaosi users. However, the core of Lei Jun's business model is still a simple marketing model innovation. He will touch the dual interests of mobile phone manufacturers and sales channels. lasting.
Once other manufacturers follow up on channel reform (such as VIVO and OPPO), or even use technological innovation to compete (such as Huawei), and your ecology and "pig" have not had time to find a good, downhill is inevitable. This is why Xiaomi was forced to expand product categories (such as Xiaomi Mi Band, Xiaomi TV, etc.) and continue to dig for hardware instead of ARPU value.
In other words, Lei Jun answered the above three questions 1, 2, and 3 perfectly, 4 answered half, and 5 had no answer. Therefore, the Xiaomi project is far from being as good as the market imagined.
If I had to choose the most innovative business model in China in the past five years, I would vote for Didi.
The difficulty of travel is related to almost everyone. The market is large enough and absolutely high-frequency. At the same time, because a lot of money needs to be burned to attract users in the early stage, people who are not rich enough cannot do this kind of innovation.
However, its flaws are also obvious: it touches the interests of almost all the people in the commercial passenger vehicle chain (such as taxis, public transportation, relevant authorities, etc.), and the people in this chain belong to the so-called society that the society will naturally sympathize with. "Vulnerable Groups". Most importantly, they are organized, not scattered individuals. The strength of the organization to rebound should not be underestimated. And, after burning the money, Didi doesn't see how to make money for the foreseeable time. The profit model has always been unclear, which is the biggest flaw in Didi's business model.
In other words, Didi perfectly answered the above three questions 1, 2, and 4, 3 answered part of it, and 5 had no answer.
Therefore, the Didi project may be a good project, but it is definitely not the "best" project. Among the five flavors, those who put money into it will experience it themselves.
If you want to choose the most innovative business model in China in the past three years, there is no doubt that it is the "shared bicycle" represented by Mobike and ofo - and I would like to call it "the most awesome". .
three
The innovation of the business model of shared bicycles is very similar to the representative company Mobike - it is really admirable and admirable.
Ofo is the earliest shared bicycle company. It was founded in 2014 by five post-90s founders from Peking University. In June 2015, the ofo sharing plan was launched, and 2,000 shared bicycles were successfully obtained at Peking University. In December, ofo’s daily orders were close to 2 million orders. Luo Bin, a partner of Jinsha River Ventures, went to Peking University to do business and saw many small yellow cars flashing by on the road. He realized that this was a company worth investing in. It caught the rigid needs of students and was frequent. Then there was the A round of financing after the Spring Festival in 2016.
Mobike has capital from the very beginning. Hu Weiwei, the founder of a 10-year automotive journalist background, is just an ordinary white-collar worker. One day in 2014, a friend who worked in the Mercedes-Benz China Design Center told Hu Weiwei that the future of personalized travel tools will be There is a wave of innovation. Li Bin, chairman of Weilai Automobile, asked her if she had thought about doing a shared travel project, and later discussed with Zhang Peng, the founder of Geek Park. Hu Weiwei had the support of these investors from the beginning, and invited Wang Xiaofeng, who had resigned from the general manager of Uber Shanghai, to serve as the CEO of Mobike.
Both are developing rapidly, as can be seen from the number of financings and valuations in the table below: (figure omitted)
The reason why "bike sharing" has developed so rapidly, almost overnight, all kinds of small yellow cars have sprung up on the streets of many cities is because this business model almost perfectly answers the five core requirements I put forward above.
First of all, short-distance travel is an absolute necessity. Especially in the increasingly crowded big cities and peak periods, it has always been a huge pain point, which cannot be solved by public transportation, subways, taxis, and private cars. In the past, some cities (such as Shanghai) tried "public bicycles", because each district government managed its own affairs, the main body of investment was not clear, the bicycles were not put in enough, and the bicycles were difficult to return.
Mobike is the representative of the "shared bicycles". The company puts out the vehicles. You can open the mobile APP to check the nearby vehicles. If you see suitable ones, you can make an appointment in advance. There is no need for parking piles or cards, and the lock can be unlocked by scanning the QR code. When not in use, you can park at any legal non-motor vehicle parking spot. The fee is 1 yuan for half an hour, and the cost of using a car is negligible. And it is simple and convenient to use, which almost completely and perfectly solves the problem of the "last mile" of the city.
Second, the market is huge. As of December 2016, the number of users of "online car reservation" in my country was 168 million, an increase of 46.16 million or 37.9% over the first half of 2016. The scale of potential users of shared bicycles will not be less than this in any case.
Even if you are a local tyrant who doesn't care about the cost of travel at all, once you have experienced the pain of having a friend for dinner, driving a private car from Dongcheng to Xicheng, it takes three hours, and then spending another hour to find a parking space, you will know that most time, would rather the subway. After getting out of the subway station, riding a Mobike to the roadside of the restaurant and throwing the car away, how happy and unrestrained. So, you can think of almost all urban commuters as a target group.
Third, this thing hardly touched the interests of any "local tyrants" in the old world, except for Mounties - which are the objects of settlement by almost all cities. Moreover, all of Mount's are "underground parties", and without an organization, it is completely unpopular.
Finally, and the most "worshipped", is that "bike sharing" has a very clear profit model from the beginning: deposit. To understand this, you have to give your heartfelt admiration for the person who came up with this model.
The profit model of shared bicycles is to partially realize cash through time-sharing leasing, recover funds by collecting deposits, realize cash flow and expand (see the figure below): (figure omitted)
The money for time-sharing lease is actually not important at all. Whether it is Mobike or ofo, I believe they have a clear mind: even if there are 100 million users, if they use one hour a day, it will only generate 100 million income. In the face of more than 10 million bicycles and hardware losses, plus other management costs. More importantly, due to its short-distance characteristics, as well as its benchmarking bus and traditional "public bicycles", its pricing is limited. So, they don't expect to make money from the rental fee of 1 yuan an hour at all.
through what?
Deposits - this is an ingenious innovation.
Before you step on the bicycle, whether it is Mobike or ofo, you must send your phone number, real name, ID number (requires real-name authentication), and at the same time, you have to submit 299 yuan ( Mobike) or a deposit of 99 yuan (ofo).
For any Internet company, it is a great happiness to be able to obtain user registration and a phone call through long-term operation. The gameplay of "sharing bicycles" is equivalent to picking up girls. The first time you meet, you will get all the identity information and phone numbers of the other party - this is an extremely harsh requirement for users, and many users with a strong desire for privacy must resist, but "sharing" "Bicycle" was realized at one time with the need to solve the pain point.
The most important thing is to let users take out their wallets - this is the last link of all business models, and it is also the most coveted link.
The reason why I say this is a genius innovation is because of the 299 deposit:
1. It can be refunded, so most people will not resist paying the money;
2. It is possible to withdraw, but the company will not automatically withdraw, and most people will not take the initiative to ask for a refund, because the next time the car has to be paid, the result is that a large amount of funds are deposited in the company, which is equivalent to free occupation;
3. The deposit cannot be used and cannot be used as a support for the rental car fee. This means that the money will only increase, never decrease;
4. Since a deposit corresponds to a registered user, not a car, it means that placing a car can lock far more than one user. Mobike currently locks 8 people with a car, which is equivalent to placing a car and getting a "deposit" of 2,400 yuan (300*8).
In this sense, every bicycle launched by Mobike is like a savings bank. The financial institution with the most branches in China is the Agricultural Bank of China, which has more than 24,000 branches and 30,000 ATMs across the country. On January 23, 2017, Foxconn became a new strategic investor of Mobike. This cooperation is expected to greatly increase the production of Mobike's bicycles, and the total annual production capacity is expected to exceed 10 million - and each bicycle is a mobile savings point.
Assuming that only 10 million vehicles are put in, 8 people are locked in each vehicle, and each person has a deposit of 300 yuan, and the total amount of funds deposited will reach 24 billion yuan - this is the most classic way of Internet finance.
Instead of focusing on profit, it solves cash flow. Instead of selling hardware, it collects deposits to make up for cash flow, which reduces the cash expenditures that ordinary Internet companies generate through massive subsidies to cultivate users. This is a very clever step.
In other words, "bike sharing" solves 1, 2, 3, and 5 in the above mode (see the table below): (figure omitted)
Only 4 is slightly flawed, but it does not hurt because the most critical profit model problem has been solved from the beginning - this is in line with the definition of the "best" model.
Four
The last question is: How far can the business model of "sharing bicycles" go?
Or, what other problems are there?
The problem still exists, briefly stated:
1. The current hardware cost is too high
Reducing the cost of starting a "savings bank" is a top priority for the future success of this model. Ofo’s bikes cost less and therefore charge a lower deposit, but Mobike’s bikes cost several times more. The cost difference between ofo and Mobike is shown in the table below. Mobike's sports version is expensive, because it is produced by its own factory, especially the chainless transmission structure, which greatly increases the weight and cost of the bicycle.
2. Difficult to ride, difficult to find problems
In order to reduce the repair rate, the company designed vehicles that are not as easy to ride as normal bicycles, and the experience will be much worse. In order to facilitate their own use, users will inevitably park illegally or even hide their cars. But these are sweet troubles that are not difficult to solve.
3. Deliberate sabotage
At least the drivers of the motorcycles will have a "great hatred" for these cars, but as mentioned earlier, this is not a big problem.
4. Competitors
Whether it is Mobike or others, it is actually just getting started. One of the biggest problems with the "shared bicycle" business model is that it is too reproducible and the threshold is not high. Mobike and other forerunners must run at full speed and take the first place in the enclosure.
5. Policy support issues
On the surface, "sharing bicycles" has not touched the interests of many people, and there is also the environmental protection concept of green travel, but once it becomes a climate, it is almost inevitable to grab (parking) space and grab (exercise) roads. In this sense, "shared bicycles" are actually the cheese of the entire motor vehicle. It is entirely possible to be suppressed by interest groups and even the administration, and it must be taken seriously.
In today's impetuous China, it is not easy to emerge with an exciting business model. I sincerely wish "bike sharing" a good journey.
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