Internet people love to slap people in the face? The laid-off employees can fill up a "one acre of land"

I think your circle of friends yesterday was just like mine, as they were all flooded with news that Yimutian suddenly laid off 1,500 employees.

As a journalist, I always try to be cautious when facing such news. However, the complaints of laid-off employees, the screenshots of internal chats circulated in the media, and other information all point to this news. The latest news 36Kr received from an industry insider last night is that Yimutian is currently seeking to acquire them. This to some extent confirms the rumors of Sequoia Capital's withdrawal of investment and large-scale layoffs.

If this is the first time you hear the name of this company, their experience may seem quite legendary to you:

• The company's founder was born after 1985 and is said to have started experimenting with a B2B e-commerce platform for agricultural products in 2011. It then became a hot topic in the media thanks to a report in Southern Weekend.

• In the intensive media reports during the same period, there were many statements such as "Sequoia Capital paid millions of dollars directly without signing an agreement to grab Yimutian". In terms of data, Yimutian also advertised that its transaction volume soared from only 500,000 a month last year to over 10 billion a month, an average of 300 million a day.

• After becoming popular, Yimutian began to be questioned by peers and the media for its slightly exaggerated data, and even a series of "onion stalks" were born from its investigation and analysis. Although Yimutian responded to the data fraud question that caused a stir, it was weak.

• Then, there is today's turmoil of "broken capital chain, problems in the new round of financing, Sequoia's withdrawal of investment, and large-scale layoffs."

If we ignore the series of messy things that happened in the middle and return to the essence of venture capital, Yimutian, as the most famous company in the industry (and very likely the only well-known company), represents the agricultural products B2B business model, which actually has many things worth discussing.

So, taking Yimutian as an example, how did this once popular company suddenly run into trouble in the seemingly promising blue ocean of agricultural products B2B?

First of all, according to the founder Deng Jinhong himself, Yimutian mainly does (or wants to do) the following things:

• Information platform: This is the "where to go" model, providing information services related to agricultural products. For example, when users search for cabbage prices, they can see cabbage price information posted by some buyers and sellers. This business solves the problem of information asymmetry and can make money from membership fees and advertising fees.

• Matchmaking: After completing the information service, we start a more in-depth online + offline matchmaking service. It is said that the company has 2,500 offline teams out of 3,000 employees, who are responsible for going to the fields to educate farmers and other suppliers, and at the same time help buyers check the goods and lock in the source of goods.

• Order agriculture and technology output: After the transaction matching stage, order agriculture and technology output will also be carried out. Order agriculture is on-demand production of "I tell you what I need, and then you plant it." This is a service that is more deeply involved in agricultural production. It needs to provide farmers with suggestions including the rational use of fertilizers and pesticides, while improving the supply chain integration capabilities.

• Agricultural big data: To put it simply, it tells you how many cucumbers will be shipped to a city and how many will be shipped out of the city in the next few days. This business can help the government regulate supply relations, stabilize local vegetable prices, and issue early warnings of agricultural product shortages.

The plans for these businesses seem to be very good, and the business models are easily reminiscent of other successful B2B platforms in other fields. For example, "Zhaogang.com" and "Huasuhui" in the steel and chemical industries also base their transactions on information display + matchmaking when dealing with bulk chemical products, while looking for profit points in the back-end such as logistics and supply chain finance. But why did Yimutian fail despite the seemingly good plans?

According to the revelations of Yimutian’s employees and previous investigations by relevant media, Yimutian’s actual implementation process was as follows:

• Rebate for order brushing: The rebate subsidy started in August last year and has lasted for more than a year. The seller signs a contract with Yimutian, and after the transaction is successful, a rebate of 2‰ of the transaction amount will be given; if the seller does not sign a contract with the company, the rebate will be calculated based on 1‰ of the transaction amount. Yimutian's sales staff previously generally used rebates to brush online transaction flow offline. The specific method is to "find a friend to post a product message on the APP, and then find a friend to buy it, pay the money yourself, and complete the transaction amount task. The money will be returned to you after a circle, and each transaction will also receive a bonus of 2/1000 of the transaction amount."

• The contract signing turned into a scam: "The signed suppliers would first deceive the farmers, and then they would falsify the remaining amount at the end of the month. They would get one thousand yuan per supplier, and the deposit would be returned to them after six months. As long as the price posted on the platform is 1 yuan higher than the market price, no one would buy it, and no problems would be discovered."

• Trading method: Yimutian does not adopt a model that integrates remote procurement and transportation logistics in its trading method for agricultural products. It simply brings the trading parties in the wholesale market to the Yimutian store and persuades them to conduct cash transactions on the platform. Therefore, it is impossible for suppliers to "sell agricultural products without leaving their homes."

• Information lag: A dealer said that Yimutian employees call nearby vendors every week, but almost no one uses their platform because the supply and demand information released by Yimutian is delayed.

• …

It can be found that in the actual implementation process, Yimutian did not really use the Internet to bring transformative value to agricultural product transactions.

For example, when interviewing companies like ZhaoX.com, many entrepreneurs mentioned that the timeliness of supply and demand information is very important because the real-time price of commodities changes frequently. The reason why it is difficult for a large platform like Alibaba to attract a large number of chemical plastics vertical merchants is that the price and transaction information are updated slowly.

But what is most criticized is the rebate and fake orders.

If the above problems can be attributed to Yimutian’s own problems, then rebate and fake orders are a common problem for companies in the industry to a certain extent. In other words, in the eyes of many companies, this is a generally feasible model. The reason for this is that in the early stages of building a platform, a certain degree of rebate and fake orders can quickly drive the growth of the platform’s business volume and accelerate its expansion.

Using subsidies to exchange for growth is a common practice for venture capital-funded startups. But Yimutian’s current situation proves that this approach is unreliable in a market where the business model has not been verified and the logic has not worked.

An industry insider told 36Kr that although one company after another that faked data fell into crisis, more and more teams are currently establishing an offline business model of "users, payments, and suppliers" by analogy with e-commerce, trying to move offline stock market transactions online, and even offering large subsidies in exchange for online orders and transaction volume, falling into a way of seeking fish in a tree. The industry insider also said that this uproar will soon end, and the market will drive itself to get back to the basics.

The problem with Yimutian, which relies on subsidies to increase data, is that it does not create real value and improve efficiency for offline agricultural product transactions. It just uses rebates to forcibly move offline things online for digitization. In essence, Yimutian does not really serve its customers, so there will be problems. In contrast, subsidies for taxi-hailing apps are different because the model has been proven to be effective and can truly improve taxi-hailing efficiency for car owners and users.

As for what can really bring about structural optimization and efficiency improvement for agricultural product transactions, for the specific market of agricultural products, "relying on a complete logistics system to reduce transportation costs" and "using brands to improve suppliers and bring more bargaining power to farmers" are far more important than simply matching transactions. However, Yimutian has not touched on this part.

In addition, although "national policies strongly support rural e-commerce" and "the entrepreneurial dividends brought by the Internet are fading", these points show that the Internet + has a clear trend of transforming the agricultural market, the development of the agricultural product market may still be slower than Yimutian imagined. Deng Jinhong once mentioned to a reporter from Southern Weekend that 30% of the users who visited Yimutian every day at the end of 2013 logged in through their mobile phones, which means that farmers can also log in to Yimutian through their mobile phones in the fields during the day. Therefore, the company decided to start matching farmers and buyers for transactions. In contrast, when Cheng Wei was working for Didi in 2012, he found that only 3 out of 100 drivers could use smartphones when he was explaining the sharing economy to drivers.

It takes passion to do business in the agricultural market, because farmers have long been a marginalized group that has been forgotten in the Internet world.

Maybe today's story is actually like this: Deng Jinhong started a business out of passion. After starting his business, he faced many difficulties. So he held the idea of ​​​​increasing the speed by swiping orders, and tried to use some small tricks commonly used in the industry to support the company's development. Unexpectedly, he encountered a storm of doubts about data falsification. At the same time, it was rumored that there was a problem with the capital chain, and the investor withdrew his investment. *** could only lay off employees and seek acquisition.

Really, I still want to believe that Deng Jinhong started his business with passion and enthusiasm. In fact, he once explained the origin of the name "Yi Mu Tian" like this:

The reason why it is called Yimutian is that I came up with it when I was looking up at the stars on the balcony. Many people always remember it as Yimudi. In fact, there is a big difference between Tian and Di. Di reminds people of planting, but Tian, ​​in addition to land, can also make people think of pastoral, which is more poetic.

In the eyes of this post-85s entrepreneur, the agricultural market was once a starry sky filled with emotions and dreams. However, when he looked up at the starry sky, he forgot to keep the acre of fertile land under his feet.

13:58 Update: Yimutian issued a statement at 12:30 p.m. today, saying that the dismissed employees were suspected of violating regulations and falsifying information, and that some employees had been referred to judicial authorities for business violations that were illegal. At the same time, it denied the news of investors withdrawing their investment. Yimutian said that so far, Yimutian’s seven institutional investment funds agree with the company’s business direction and actively support the company’s development, and have never made any form of withdrawal requirements or actions. Click here for the full statement.