Aipinche's sudden death: Internet entrepreneurship under the shadow of BAT

Aipinche recently announced that it would stop service due to insufficient funding, while Didi Kuaidi received a $142 million investment from Sina Weibo . The role of capital is evident in this explosively growing field. Startups are trying their best to please capital, but how easy is it to rely on their own abilities? BAT has expanded in various industries with its own resource advantages, and even capital has to watch its movements. Therefore, entrepreneurs seem to be unable to avoid the pressure of powerful giants.

Giants' will

Aipinche co-founder and vice president Yang Yang explained the reason for the closure. The industry is already controlled by capital. Currently, Didi Kuaidi, Uber, and Yidao have all provided huge subsidies, which have a great impact on the industry. Aipinche has completed three rounds of financing since its founding. In March this year, Yang Yang believed that Kuaidi and Didi successively launched No. 1 Express and Didi Express, which affected Aipinche's capital operation. Therefore, the fourth round of financing was not completed.

Two days later, Sina Weibo confirmed its investment of $142 million in Didi Kuaidi, which undoubtedly formed a sharp contrast. Yang Yang believes that the travel industry is currently under the control of capital. When the giants are burning money to compete, capital will not look at smaller entrepreneurial teams.

In fact, as far as the travel market is concerned, since the taxi war began, Didi and Kuaidi, each supported by Tencent and Alibaba , have consumed more than 1 billion yuan in a marketing war. Along with the war, entrepreneurial teams that once existed in this field, such as Yaoyao Taxi and Baimi Taxi, quickly disappeared.

The same story continues in the car-hailing and ride-sharing markets. According to the "China Internet Car-sharing Industry Special Research Report" released by Analysys International the other day, the top three domestic Internet car-sharing apps in terms of daily average active user coverage in April this year were Didi Car-sharing, 51 Car and Tiantian Car, accounting for 59.88%, 21.71% and 15.27% respectively. Both 51 Car and Tiantian Car have received strategic investment from Baidu .

After receiving investment from Baidu, 51car CEO Li Huabing publicly stated that he is ready to participate in market competition and is full of confidence, "If the subsidy war begins, 51car will fight to the end and give its all."

An analyst who wishes to remain anonymous believes that Didi Hitch is relatively independent, but there is a high possibility that it will join the giant camp. "If it does not obtain relatively strong resources to support and back it, it will easily be replaced in this market."

Zhang Xu, an analyst at Analysys International, believes that insufficient capital is a key problem that startup teams need to solve, but lack of resources cannot be ignored. For example, Didi Kuaidi has already gathered a large number of users on the two major platforms of WeChat and Alipay. With the entrance of large traffic, it is bound to increase the confidence of capital and its own team, which other startup teams do not have. "It is not impossible to bypass the financing of giants, but judging the capital of giants from the value is more practical."

Own shortcomings

If it is inevitable that giants influence the market trend with their huge resources, the long-standing shortcomings of the entrepreneurial team are an important factor threatening their survival. Aipinche is the earliest entrant in the carpooling field, but Aipinche did not seize the opportunity to quickly occupy the market. Yang Yang revealed that Aipinche did not focus on the carpooling market before, and opened up the car rental business last year, which affected the team management.

The above-mentioned analyst who wishes to remain anonymous believes that competition in the red ocean market is not determined by the time of entry. Entrepreneurial teams need to continuously improve product functionality and quality while seizing the opportunity, so that they are qualified to continue to attract the attention of capital.

In fact, venture capital pursues startups with development potential, and development potential comes from the capabilities of the startups themselves. At the Baidu Alliance Summit not long ago, Baidu Vice President Zhu Guang said that the current mobile Internet industry is more segmented, and competition is also in a fierce stage. Technical capabilities, channel management, and sales systems have become the shortcomings of some entrepreneurs. This era tests the comprehensive capabilities of entrepreneurs.

Hu Hao, senior director of Tencent Open Platform, also said that some startup teams think they are confident of pursuing long-term development after angel round financing, but 97% of startups die before round A. Product data performance and the construction of their own competitive barriers can attract more capital. Whether the startup team can break through its own bottleneck, look further ahead, and find or adjust the development direction of the product or project in a timely manner is very critical at this stage.

Li Dawei, founder of Shanghai maker platform Xinchejian, believes that in addition to hard skills, many entrepreneurs still lack the passion to pursue their dreams. Too many people pursue "entrepreneurship" instead of dreams, so they lack persistence. "In fact, entrepreneurs have always been squeezed by giants, which requires companies to find long-tail markets that giants have not yet opened up in order to gain the favor of capital, but this is difficult to do."

He pointed out that not all venture capitalists will follow the giants' lead. Some venture capitalists like to invest in new concepts that can change the industry in the long run, such as flexible screens and flexible batteries, while some like to invest in quick-in, quick-out investments to make quick money. At present, most startups still follow concepts and lack judgment.

How to please the giants

Although startups aim to be on par with BAT, many of them originally intended to be acquired by giants, hoping to be needed by them by starting businesses in areas that giants have not yet ventured into. Just like Didi and Kuaidi, they grasped the needs of WeChat and Alipay when they were competing fiercely in the mobile payment market, and thus became important service portals for them.

It is worth noting that there are many such examples, and many well-known companies have also been merged into the giant camp: Tencent acquired Foxmail, Yixun, Sogou and various game companies; Alibaba acquired AutoNavi, UC, Umeng, and Xiami Music; Baidu acquired 91 Wireless and Nuomituan. At present, BAT has established entrepreneurial platforms and opened its own resources to entrepreneurs. A number of entrepreneurial companies have grown up based on these platforms.

An obvious trend is that the Internet industry has gradually matured, and traditional industries are also facing product upgrades and technological transformation. Therefore, the O2O industry, including mobile travel, which focuses on life services, has become the primary consideration for many entrepreneurs. Services require a large number of users, and the channel entrance for quickly acquiring a large number of users has long been dominated by giants. It is natural for entrepreneurs to value this.

On the other hand, as part of the system built by the giants, these startups included in their territory have less pressure to make profits, so they can let go and do a good job of business promotion and are willing to spend money. Zhang Xu believes that independent companies always need to think about profit models, find ways to upgrade products, and face competition from giants, which is far less cost-effective than relying on them for growth.

As far as the carpooling sector is concerned, the companies currently at the top of the market have almost quickly completed all the financing they can obtain. In areas where giants participate, the risk of investment will also increase. Therefore, such investors cannot be relied upon in the long term. Instead, the capital injection and cooperation from giants will provide a boost.

Li Dawei said that whether entrepreneurs provide services to giants or expect to be acquired by giants, they all have one goal, that is, to make a profit. Because they are doing business and currently do not mind how much money they make. Therefore, many entrepreneurs choose to grow and develop on the entrepreneurial platform established by giants from the beginning. "Starting a business requires more money and more resources." He said frankly.

As a winner of Toutiao's Qingyun Plan and Baijiahao's Bai+ Plan, the 2019 Baidu Digital Author of the Year, the Baijiahao's Most Popular Author in the Technology Field, the 2019 Sogou Technology and Culture Author, and the 2021 Baijiahao Quarterly Influential Creator, he has won many awards, including the 2013 Sohu Best Industry Media Person, the 2015 China New Media Entrepreneurship Competition Beijing Third Place, the 2015 Guangmang Experience Award, the 2015 China New Media Entrepreneurship Competition Finals Third Place, and the 2018 Baidu Dynamic Annual Powerful Celebrity.