Before the Spring Festival in 2017, a professor and his “team†closed down a radar hardware technology in an old factory building in rural Hebei. If they successfully enter the market, the price will be only three of the similar imported products. One in a minute.
Zhang Yang and his investors Zhang Tu, who understands the matter, are extremely excited. “Do you think how big this market is?†But he didn’t want to reveal more details – after all, they were digging the ground three. The ruler only gets the information.
In China, startups are in urgent need of new technologies to acquire new customers and markets. These technologies are not necessarily great black technologies. They are practical but difficult to obtain. The cutting-edge technical information from domestic universities and even Silicon Valley is so scarce that they are only delivered within a small circle.
For Zhang Ju, the intelligent CEO of Tuju, he is in urgent need of a technology that can reduce the positioning accuracy in a specific environment from 1 meter to 10 centimeters – the accuracy of the new three-board company that does indoor positioning. It means that the market can be expanded from the current shopping malls and other scenes to the industrial areas of the factory floor, logistics warehouse, and construction tunnel. The latter's market plate is estimated to have a scale of one to two billion.
Whoever gains a right-to-road technology can gain a great competitive advantage in the market.
Due to the long development cycle and high risk of cutting-edge technology, it is often difficult for startups to acquire technology directly. A large company like Huawei has applied for 4,906 patents last year, and the investment in R&D has reached 76.4 billion yuan, making it difficult for startups to look back.
The investment circle is also searching for technical projects.
With O2O as the representative model for innovation, and the mobile Internet bonus period reaching the top, the entire investment circle is also anxious to invest in something. According to the observation of the door CTO Shen Qiang, only 30% of investors focused on technology two years ago, and now 90% are watching.
"My case is generally not in the B round." In the past ten years, most of the projects of the Northern Light Venture Capital Partners, the Yellow River Investment, were technical. After the early completion, it was difficult to find the right one. Slowly longer. “In the past, other investors said that they couldn’t read it. But since the second half of last year, everyone began to rush to grab it and get it quickly.â€
In 2016, the four projects of the Yellow River have successfully merged into the B-round. Even in the austere and aerospace aerospace field, the recent six venture capital projects “break the head†for a project, and the valuation has been lifted by 100%. People in the investment circle began to frequently use the Yellow River as a technical expert to learn from the past. “How can I have ten waves in a month? Nobody cares about me,†he half-jokingly said.
Where can technology come from? How can it be? Whether it's a startup company or an investor, if you can break through these problems, you may catch an outbreak.
Where does the technology come from?
In 2016, for China's technological entrepreneurship, it may be the beginning of a budding period.
This trigger point began last year with the State Council's “Promotion of Science and Technology Achievements Transformation Lawâ€. The most critical clause is that the share of the people who will make major contributions to R&D and achievement transformation will be increased from the previous 20% to no less than the reward. 50% of the total.
Along with this, some open-minded universities have successively introduced policies that encourage the transformation of technological achievements.
For instance, Tsinghua University has changed its ownership of intellectual property from the past to "professor and entrepreneurial team accounted for 70% of the equity, schools accounted for 15%, and departments accounted for 15%."
Shanghai Jiaotong University established the Intellectual Property Management Co., Ltd. and piloted the intellectual property capital increase plan. In the transformation of the technical achievements of the school's scientific research team, the school will occupy 5% to 35% of intellectual property shares.
The school's transformation is crucial.
In the United States, a large number of technologies were firmly controlled in the hands of universities and large companies. Large, powerful companies acquired patents by buying out professors and university laboratories, such as Bell and Siemens.
Until 1980, the United States issued the Baidu Act. "It directly detonated the tide of scientific and technological innovation in various industries in the United States." Wang Qiquan, who has been investing in technology in Silicon Valley, believes. This bill regulates the interests of universities, professors, and companies in the market, allowing startups to reduce the cost of acquiring cutting-edge technology, and is almost at the starting line with large companies.
In the area of ​​technological entrepreneurship, academia is already a source of technology that cannot be underestimated.
Tang Xiaoou, a professor at the Chinese University of Hong Kong, plays in the roles of behind-the-scenes bosses in two AI field stars: Tang Technology and Linkface. According to industry sources, Tang Xiaoou funded the establishment of Shangtang, and his laboratory provided Linkface with the core technology. Both founders of this startup company were former students of Tang. Last year, Shang Tang Technology's valuation has exceeded 1 billion US dollars.
Wu Yong, the managing director of Qidi Venture Capital, suddenly became a hot person and has a close relationship with this.
In the investment industry, he is looking at areas that are out of the cold: medical health, environmental new energy, high-end manufacturing, and artificial intelligence early projects. The payback period is not short. It is usually five to eight years. Even big money projects are More than eight years. “The investment team originally did not like ours because of the slow growth of technology projects.†But this year, there are a lot of people who want to trust Wu Yong’s relationship and share the early cases he sees.
The company has seen so many technical projects closely related to its academic background: The predecessor of Vita Ventures is the Tsinghua Science Park incubator company and technology asset management company, which belongs to the industrial system of Tsinghua University.
Driven by market demand, schools like Tsinghua University had long been surrounded by incubators, technology and startup companies. However, the rationalization of intellectual property rights and the distribution of benefits means that the supply of technology in universities may open up even more.
“The past scientific and technological achievements belong to the school and they are not individuals. Professors do not have the enthusiasm to do the conversion, not to mention the entrepreneurs are so hard, and the failure rate is high,†commented Wu Yong of Qidi Venture Capital. In the past, China has allocated a lot of scientific research funds each year, but the vast majority of them have made mistakes. In the end, they created a paper and won a national award.
The limitations of the system led to the transformation of technological achievements in universities in the past decade or so. It is a chaotic field. Some professors bypass the school to set up companies in the name of themselves or their families. If you don't do it, once you go public, you will often get entangled with the school because of intellectual property rights. This risk is guilty of institutional investors taboo. The case that the school asks for control is also worrying investors.
Wu Yong also once suffered from a class of professors. Enlightenment once invested in a college project. The product is not mature enough and needs a lot of research work. However, the professor is busy with applying for national projects and various jobs. Students do not master the core technology, and product managers and technicians are all professors recommending and investing. It is difficult for people to change or manage. The company finally stagnated. "It may not be enough to finish the money."
However, this problem is not impossible to solve. “Stanford many professors convert scientific research techniques into achievements. They all let students do it, and the success rate is very high. For example, three students can become one. The professor himself can't do it with all his efforts.†Wu Jun, who has been in Silicon Valley for many years The reporter said.
Although China's college environment is different from that of the United States, for reference, after the introduction of the Baidu Act in the United States, the conversion rate of scientific and technological achievements in the United States has increased 10 times in 1978, a very short period of time. Around the technological entrepreneurship surrounding Stanford and other institutions, it created the prosperity of today's Silicon Valley.
In the first half of 2016 alone, Shanghai Jiaotong University transferred and licensed 177 intellectual property rights. The contract amounted to more than 47 million yuan. This figure should be greater in the future.
However, this is not a smooth road. Tsinghua’s official website has long scrolled through hundreds of research projects that can be transformed into achievements. Wu Yong’s task is to single out single digit “gold†in hundreds of projects: the vast majority of these papers are pursuing scientific research awards. Going, and Wu Yong wants, is a project that can be commercialized in about three years. There is still a gap between the two.
Silicon Valley, Big Companies Institute and Technology
The domestic enthusiasm for technology is also transmitted to Silicon Valley.
Alex Ren, Managing Partner of Capital Capital's Silicon Valley, could not remember how many Chinese CEOs he had seen in the cafe next to Stanford, especially AI and robots. He spent the third of a year in Silicon Valley looking for someone to find someone. technology. At the Zhongguancun Silicon Valley Venture Center in Santa Clara, the heart of Silicon Valley, Chinese investors and entrepreneurs come to the bus every two days to find someone to find a project.
"They used all kinds of contacts, alumni recommended, and found Stanford's activities everywhere to find students and catch Chinese engineers on the road to chat." Alex's CEO and investors in Silicon Valley saw much more than in China.
The technological hunger of Chinese companies has even spawned a business in Silicon Valley. A group of middlemen specialized in the technology of excavation was packaged, plus foreign elements, sold to domestic companies. According to Wu Jun’s observations, this demand has grown rapidly and reached its peak by 2015.
There is also a group of technical talents who are determined to return to their own businesses.
Liu Yuan, vice president of investment management at Zhenge Fund, observes that the business of returnees was concentrated in vertical e-commerce and lifestyle projects more than four years ago, but with the elimination of opaque information, these people have no obvious advantages over local entrepreneurs. However, Silicon Valley is still a treasury of technical talents. Domestic entrepreneurship is hot, and technology entrepreneurs attract peaks in return.
According to the reporter's observation, in the last five years, more and more people engaged in the field of cloud computing, big data, and artificial intelligence have chosen to go back to their businesses.
At the beginning of 2012, Gree Deep-Sweeping CEO Zhao Yong was still doing image recognition at the Google Research Team. He just bought a house in Silicon Valley and vaguely left the idea of ​​leaving Google. He experimented at home and the living room was full of machines.
Li Zhifei, who joined the Google Research Team for voice recognition in the same period (later started to ask questions), went to Zhao Yong's house with his pregnant wife to see the house. Understanding Zhao Yong’s thoughts, Li Zhifei felt that he could no longer wait. He is a Hunan man. In May, he came up with an app demo to Zhao Yong. In August and September he came to Zhao Yong again. "I'll get a party and send it to me. I've got the money. I'm leaving." He studied Google in those years. The first home to start a business.
"I thought that I was too embarrassed to be seen by others in my home laboratories for so long. He was looking for someone to finance so quickly." Zhao Yong was greatly touched and resigned in January of next year, January 27th. He took the box and appeared in Xu Xiaoping's home at Guomao.
Zuoyi was the chief development manager of Microsoft and founded Lingqin Cloud in 2014. Upon returning to China, the Zhongguancun Business Building provided free workers for returnees. He and his partners watched the building in a hurry and conducted various assessments every day. After that, they could enter the business park and have free jobs. "Everybody is like playing blood, and the enjoyment of entrepreneurship itself is greater than achievement."
Li Zhifei, Zhao Yong, and Zuo Yu are the people who returned earlier in this wave of wave of technological entrepreneurship. For the technically-impaired people, the fiercely changing China, the huge technology demand and application scenarios are bigger than those of Silicon Valley companies. Golden cages are more attractive.
However, more often than not, "scientist entrepreneurship" is a false proposition - from the market actual point of view, the success rate of professors and even large corporate R&D personnel who venture out in person is not high.
“AI scientists are often super otaku. They live in their rooms and experiment all day. Suddenly you throw him into a cruel, savage and terrible business world. His entrepreneurial success rate is not very high.†Innovation workshops have already bet On artificial intelligence. Li Kaifu knows well that the core of AI entrepreneurship lies in having scientists, but not only that.
Therefore, the Innovation Workshop created an incubator-like AI Engineering Institute for scientists. Seek engineers, look at business directions, find financing, and even sell products.
Investors through various possible routes, to explore the technology hidden in the underwater bull, the data algorithm competition platform has also become an observation outpost, winners are hot.
Since 2015, Ginkgo Valley Capital has repeatedly found Wang Yiting, the head of Alibaba Cloud Tianchi Platform, and requested cooperation. "As long as it is your recommended entrant to start a business, we immediately invest 5 million." The other party even proposed to set up a tens of millions of funds, specifically for investing in Tianchi contestants.
Understand the dynamics of CTOs in large corporations, break through the barriers of institutions of higher learning, and lock in winners of outstanding papers... The methods of investing in people are not much different from those of entrepreneurs.
Sprouting period?
This year's technology projects are not cheap, and the rate of appreciation has surprised investors.
“We also saw some outstanding entrepreneurial projects in the market. The angels achieved the valuation in round A. In particular, the entrepreneurs associated with AI dared to price themselves, and they were also recognized by investors.â€
Co-founder and CTO Shen Qiang said.
In previous years, Wu Yong did an angel round, usually on the scale of several million and tens of millions. Now it is starting at 50 million. Medical devices and precision medicine, as long as there are several people who come from large organizations in the team, angel round valuations of hundreds of millions. "Some of the projects haven't started clinically. There aren't anything. There are hundreds of millions."
Not long ago, he rejected a star technology person's entrepreneurial project, took the country and investors tens of millions, 100 million yuan of funds, done four or five years, only sold a total of 2-3 million products, the valuation is as high as a dozen One hundred million. The negotiating table sat in a large number of investment circles, and some were on the spot.
"Now there is a lot of money. It's a multi-billion-dollar fund. The government's money is not afraid of risk. We make a fund of one or two billion yuan. People have high prices. How can you get in low prices?"
Since the second half of last year, a technical investor has found it increasingly difficult to invest in projects.
A lot of hot money still can't wait to be put on a gaming table. The Chinese government is determined to promote technological entrepreneurship. I am afraid that no country's entrepreneurs can get more blood from the government.
Silicon Valley investor Wu Jun calculated a sum of money for the reporter. The amount of venture investment in the entire country ranges from 30 billion to 50 billion U.S. dollars. China, in 2016, was only a city in the central region of China. 100 million yuan (about 26.1 billion US dollars), quickly catching up with a country on the other side of the ocean. "This is not something that we can imagine abroad. Therefore, many projects that do not get investment in the United States have returned home."
Industrial parks across the country have mushroomed like mushrooms. Professors from some universities and colleges, including Tsinghua University, receive mass mailings from various high-tech development zones every day, promising to provide start-up funds, settling fees, and even solving children's school problems.
The government guides entrepreneurship as a Chinese feature. The advantage is that the high efficiency of administrative orders is beyond the reach of foreign countries. When lawyers in the United States were also discussing politics in the National Assembly, Chinese officials, like engineers, operated the city as a company, and they were able to lay out their IT infrastructure across the board. Therefore, Wu Jun thinks that China cannot and does not need to copy Silicon Valley.
However, if the administration leads to deviations, the effect will be disastrous. Just like the previous clean energy industry and robotics industry, rapid growth also quickly died.
In Wu Yong’s impression, starting from the state’s policy to support solar energy ten years ago, a large wave of companies turned out and the competition was fierce. Afterwards, the cost of solar power, components such as power generation panels, and the cost of photovoltaic power plants have all come down. However, too many companies have been built, state subsidies have not been able to keep up, and these people have been very sad since last year. "This is the progress of the country, but it also wastes a lot of money. Many investors are finished."
In the first two years, the transformation of the manufacturing industry was promoted and Zheng Sheng was held. The robot industry parks in large-scale civil engineering offices were established throughout the country. At the beginning of 2016, the Yellow River passed through Chongqing, and only three or four listed companies were seen in the park with an area of ​​more than one hundred acres and over a thousand acres. “The empty factory buildings are extremely barren. Some take the preferential policies of the government and put the company one. Registration went away."
The people’s entrepreneurship is always mingled with people’s pursuit of the wind. When the tuyere rises, you can get a stroke. Waiting for the wind to stop, burn a group of entrepreneurs, and burn a group of investors is an inevitable outcome.
Moreover, a large number of investors who originally looked at the innovation of the business model, after rushing into the technical field, encountered high thresholds for interception. Can't read or vote?
After all, choosing to wait and see is a minority, and more investors are hoping to cash out in the rapid rise in valuations, as long as they keep up with the tide of the track. Ironically, nobody knows whether or not he will be the person who will make the final decision.
For those who entered early, they used to see bloody scenes that were too lucky. Around 2010, the concept of graphene enthraled many investors. Seven years have passed and so far there have been almost no energy companies producing high-quality graphene below the third level, and all the money has been lost.
Therefore, for investors who look at technology projects all year round, the sudden rise in heat may not always be a healthy signal. The influx of hot money means that the money is not far away, speculative, spoiled, absurd projects to VC will come in. Each wave, the blind follower of the VC circle will give birth to a bubble, the Yellow River even think that another year, the bubble of technology entrepreneurship has reached its peak.
Therefore, Wu Yong, Huang He, and Shen Qiang are more willing to chase down the so-called tuyote, and vote for technologies that are not only technically thresholded, but also can be quickly applied to market verification values.
Although technology entrepreneurship has become a big sign, and the success of the creation of the investment circle dangled, but it really is divided into hot money or AI subdivision "damp." The all-encompassing environmental protection, new materials, internet of things, industrial automation, etc. in the technical field have attracted additional attention this year.
"Actually, a lot of money is not earned by outlet enterprises."
Shen Qiang continued to bet on the Internet of Things this year. He told reporters that because the entire ecosystem is too fragmented and the Internet of Things has been tepid, it will have long-term value in the next five to ten years. It will be in the manufacturing, medical, and commercial industries. The transformation is a surging undercurrent. He does not want so many people to speculate.
Perhaps every wave of entrepreneurship is unavoidably accompanied by radicalization and chaos, but the few companies that have finally settled down will become the mainstay of China’s innovation and economy in the next decade.
What kind of technology does China need?
There are no shortages of entrepreneurs like Zhang Yang mentioned at the beginning of the article, trying to improve the company's competitiveness through technology. On the side of his client-traditional company, due to higher and higher production costs and increasingly thin profits, the transitional Chinese market is also experiencing an unprecedented thirst for technology.
Last year, the U.S. group did not hesitate to purchase a share of KUKA, a German robotics company, for 8.8 billion yuan. In the first half of 2015, U.S. group’s human capital investment has exceeded 2/3 of its net profit, which is after employees substantially reduced by nearly half. Labor costs. The chairman of the United States, Fang Hongbo, said that the human cost of the Pearl River Delta has continued to rise, and the wave of machine substitutions is on the rise.
However, the core components of the local robot companies depend on imports, and the prices of these products are high, which cannot open the market.
The seemingly beautiful mobile phone manufacturers were dragged into the low-margin quagmire by the price war, and they were choked by American chip suppliers. In March, ZTE had to submit to the US government and pay a fine of 890 million U.S. dollars. At the end of last year, after the Meizu struggled, they chose to reconcile with Qualcomm.
Manufacturers including Xiaomi and Huawei tried to break the embarrassment. On February 28, Xiaomi released its self-developed chip "S1." This is just the beginning of a self-help. "The mobile phone chip is almost the most integrated component, with more than one billion transistors, and the investment of one billion yuan is starting to yield results in ten years," Lei Jun said.
The large Chinese Internet companies, including BAT, have also come to the stage where they rely on technology to improve their efficiency.
In mid-March, Alibaba launched the "NASA" program, an independent R&D team specializing in cutting-edge technology. NASA brings together 20,000 scientists and engineers around machine learning, chips, IoT, and operating systems. Ma Yun’s original remark was: “In the past, we used technology to follow the business. It was the pattern of the arsenal. Afterwards it was the missile model. The new economy needs to be built on a completely new technology system.â€
Going a step further, Chinese large companies and small companies all need technology.
However, it is worth considering that what kind of technological entrepreneurship is needed in the commercial market?
The Yellow River customarily classifies technology as "science" and "technology." The former is almost an exciting subversive next-generation technology, and as an investor, the Yellow River wants the latter to be capable of large-scale industrial production within three years.
According to his experience, the science-based technology that comes out of the lab has often been used in large-scale production for more than a decade. In the process of industrialization, a large number of cases are either too costly or difficult to overcome, or difficult to obtain. Business income.
"Although some technologies are very expensive, but it means a lot of money, so basically the country is supporting such applications. Our capital is to seek returns."
The industry also maintains a wait-and-see attitude towards scientists' entrepreneurship. The challenge from business people is that there is a natural difference in thinking between the academic world and the industrial world. Academic people always want to make a cutting-edge technology shocking the world, rather than pushing back the technology from the needs of the product, which is the biggest headache for investors.
The Yellow River believes that many people's mistakes in technology entrepreneurship lie in the supremacy of technology.
“People who engage in engineering should think that technology is the best in the world. But technology is only a means, not the most important factor in technology entrepreneurship. If it cannot be integrated with business, it is not worth investing.â€
The biggest nightmare of investors is that technology entrepreneurs cannot estimate the difficulty and cycle of marketization and fall into the pits and continue to burn money.
In 2010, he invested 2 million in a Taiwanese team doing PECVD (plasma-enhanced chemical vapor deposition) equipment. The technology is very good. Only two or three companies in the world can do it. Eventually this project ended in tragic fashion. The founder was too technically minded, and the positioning and design of the product did not keep up with external changes. When things came out, the market changed.
What the industry is more concerned about is whether there is a market for technology. After all, a large number of scientific achievements are groping. There are still projects that are seven or eight years away from industrialization and they are shunned.
In contrast, some of the less “sexy†technology ventures have more money, such as industrial automation and new materials. While people are focusing their attention on the tuyere-level technology such as artificial intelligence, a large number of industrial robots and other technologies that can immediately increase production efficiency, promote industrial upgrading, and reduce costs show tremendous and real needs.
And if we take a short look at the AI ​​technology that the capital is chasing after the heat, it is a grand and broad topic that technology promotes China's commercial and industrial progress. But whether it is for China’s commercial society or entrepreneurship itself, it requires an effective channel for acquiring cutting-edge technology at a lower cost.
Looking at the history of global economic development, most countries, such as India and East Asia, have not been able to directly adopt advanced Western technologies to increase their own production efficiency. "This is because the wages of workers in these countries are too low, and Western technologies are too expensive." Oxford University professor Robert C. Allen summarized in his book. But Japan is an exception. During the Industrial Revolution, it introduced Western technology and made imitations and improvements based on the local market, greatly reducing application costs. The rise of Japanese industry is obvious to all.
This also applies to China.
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