What did fun shop Luo min do wrong?

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Welcome to the wechat subscription number of “create a story”: sinacchangshiji
Wen / Jiang Yue, Liu Yimo
Source: chief character view (ID: sxrenwuguan)
At the age of 35, Luo min made a decision: before the company’s market value reached 100 billion dollars, she would not receive any salary and bonus from the company.
It was March 2018, five months from the listing of qudian on the New York Stock Exchange, and three and a half years from the establishment of qudian.
There is no doubt that this is a young company. On the day of the declaration, the market value of qudian is 5.2 billion US dollars, nearly half of which is evaporated compared with the day of listing. But the ambitious entrepreneur believes that this is just a small obstacle to his great success.
He obviously underestimated the length of the bumps. To this day, on the second anniversary of the listing of qudian, the capital market still sends “congratulatory gifts” in an unhurried way: the market value is 1.879 billion dollars, less than one sixth of the highest $11.7 billion.
To make matters worse, there is no sign of improvement.
01
In the summer of 2018, Luo min moved the headquarters of qudian to Xiamen. Standing at the floor window on the 39th floor of Zijin building near the sea, you can see the Golden Gate island on the other side.
The past marks are kept on the door of the conference room in the form of doorplates: Qiu Madu, Fenghuang Hui, Zhongguancun SOHO, No.1, Danling street, No.222, Huizhong Beili. That’s the office of qudian in Beijing.
Luomin’s most glorious and arduous days remain in that city. He has lived in the bed of the South Gate of Peking University, the basement of Dongzhimen, and the shared house of Huilongguan. He has failed in more than ten businesses. Two years ago, after ringing the bell on the New York Stock Exchange, he flew directly back to Beijing, ate a bowl of rice noodles, and appeared in the office of No. 222, Huizhong Beili.
Photo: Luo min, founder of qudian
After joining the $10 billion club, he chose a brand new city.
Of course, the reason is not just that the inland people yearn for the seaside.
In the winter of 2014, when the fun store was founded (early as “fun installment”), he jumped on his desk and promised his employees that he would take you to Sanya seaside annual meeting next year. This seaside annual meeting was postponed to the beginning of 2017, with less than 100 old employees present.
Luo min’s dream of the sea made substantial progress a few months later: the Xiamen government began to contact with Luo min and urged the latter to move south.
The policy advantage is more attractive than the seaside scenery. In addition to the tax and land preferential policies given by the government, Xiamen is also the first city in China to promulgate the laws and regulations on financial science and technology filing, which is of self-evident significance for Internet Financial Enterprises – the online loan department of JD digital technology has settled in Xiamen.
Luomin also chose to move south. However, not everyone agrees with the boss’s choice, especially the way he is too determined: more than 200 employees were sent to Xiamen from Beijing on business, and were told to make a choice, either to leave or stay in Xiamen. In a hurry, some employees directly applied for labor arbitration.
Romen didn’t care.
This small town entrepreneur has a strong desire for success and has developed his own methodology. Zhu Tianyu, partner of LanChi venture capital, who participated in round a investment of qudian, once commented as follows:
“Romer is a standard gamer, who loved playing StarCraft during his college years. This game emphasizes the timely strategy, and needs to constantly find resources and strategies to deal with the rapidly changing battlefield. Only if we have a strong offensive, control and execution of every detail in place, can we finally win. ”
Auto retailing became the first battlefield opened up after Luomin rang the bell.
This is the direction he tried in 2013. The car group buying project was finally abandoned, but it planted seeds in Luo min’s heart. After qudian’s listing gave him a 10 billion level of cash reserve, the seeds sprouted again.
He named the new project “Dabai”, corresponding to the first car he bought in 2006, the white Alto in manual gear, or “Xiaobai” for short.
Figure: off line stores of Dabai automobile
The model of big white car is to rent and sell. When a company purchases a car, it makes an installment payment agreement according to the user’s needs and leases it to the consumer. When the contract expires, the user can choose to pay off the balance or return the car. During the installment period, the ownership of the car belongs to Dabai automobile.
On the last day of October 2017, the first store of Dabai was established in Xiamen.
Since then, the project, led by Luo min himself, has been pushed forward with super fast “interest store speed”: 175 self operated stores have been opened within 72 days, and 660 Guan Peisheng have been sent to participate in the war.
Luo min is excited about it. He is proud in the public account “I am Luo Min”:
“The first core value of the company is fast. The essence of modern business is not that big companies eat small companies, but fast companies eat slow companies. ”
According to his expectation, the pace of Da Bai automobile should be: by the end of 2018, it will be among the top 5 Auto retailers in China; in the next few years, its annual sales volume will reach 2 million, becoming the largest auto retailer in the world – as for the specific “waiting years”, he did not mention, just as he did not mention the time when he set the target of 100 billion market value.
Maybe it’s just romin’s style. But in the eyes of outsiders, it inevitably appears that there are some lack of preparation, unclear planning, and even as a casual signal.
However, these details do not matter in the future.
From the warm opening to the large-scale closing of the store, the big talk took only one year. Although it once contributed nearly one-third of the total revenue of 7.69 billion yuan in 2018 with the revenue of 2.175 billion yuan, in its short life, this is the only highlight time except the opening.
There are more questions around Dabai, such as its revenue calculation: most of Dabai cars are sold in four-year installments, but the interest stores record all the revenue in one time to support the financial statements.
The business itself is problematic.
In the eyes of executives, the business is not complicated: interest stores are rich enough to buy cars and stage users. Therefore, the stores of Dabai are mostly located near the shopping mall, which is convenient for users to buy cars while shopping. But in fact, they underestimated the professionalism of the auto retail industry. In terms of consumption habits, users will not buy a car as they buy mobile phones by stages.

In August 2018, Alipay ended up cooperating with the interesting store and disappeared with this huge traffic entrance. It is the appointment quantity of the big white store.
A month later, there was a tide of store closures in Dabai. In May 2019, the project, which bears the ambition of Luo min, was completely terminated.
02
When Romen chose to face the sea south, his “dignitaries” made the same choice: to leave.
During the two years of listing, except for Luo min, the top six shareholders who appeared in the prospectus of qudian have all cashed out, including Zhou Yahui, Kunlun who wrote all kinds of notes for qudian listing.
From left to right: Luo min, Zhou Yahui
He used to be one of romin’s most trusted people.
At the end of 2014, Zhou Yahui saw the greasy office full of recklessness for the first time. He saw what he looked like when he was young and the opportunity to make money. In April of the next year, Kunlun world wide Investment Co., Ltd. led the investment, and Qu completed a round C financing of US $100 million by stages.
The relationship between the two continued to improve.
On July 7, 2016, qudian announced the completion of the initial pre IPO Financing of about 3 billion yuan.
At the conference, Luo min showed the company’s youth and speed: 839 days after its establishment, 3000 employees, and an average age of 23. But at the moment, he is worried – because of the frequent occurrence of vicious events, on this day, the regulatory authorities announced to tighten the campus loan business.
This is the foundation of qudian. The company has an off-line team of nearly 2000 people, many of whom are managed by Luo min.
As soon as the conference ended, Luo min sent Zhou Yahui two expressions of crying. In front of the latter, he doesn’t need to cover up too much.
However, after the successful listing of the interest store, Zhou Yahui performed in a higher profile than Luo min. He described his “long held satisfaction” in ten thousand words, and also dragged the low-key Luo min into the public opinion field.
After all, the relationship that comes from money is separated by money.
After the lifting of the ban in March 2018, Zhou Yahui has sold the shares of qudian six times. On April 12, 2019, Kunlun world wide will sell all of its 18.17 million shares to qudian, completely liquidate and exit, with a profit of about 1.2 billion.
Another way to get rid of the status of an interesting store investor is ant financial.
In August 2015, ant gold clothing was introduced. It brought capital and brought Alipay’s mature wind control model, data analysis and massive users.
The effect is very obvious – the prospectus shows that in the fourth quarter of 2015, the average monthly and quarterly active users, new users, transaction volume and transaction amount of qudian achieved a month on month growth of more than 200%. It was in 2016, after ant Jinfu became a shareholder, that interest shop realized its profit.
Backed by the ant gold suit, Luo min once had a very comfortable life: no need to make additional investment, business personnel can directly dock with the ant gold suit. A report by pingwest points out that:
“CEO Luo Min himself is not even interested in the sources of borrowers outside Alipay. The only thing that counts is mass marketing, which is mass advertising messages.”
However, the days of making money will not last long. In August 2018, ant financial did not renew its contract after the cooperation with qudian expired. After all, the original sin of the campus loan of the external interesting shop is the rise of the internal flower and loan. Ant financial service does not need to continue to support the interesting shop.
The direct impact of this is that since ant gold began to reduce the drain to the interest store in 2017 Q3, the number of active users in the interest store decreased from 7.5 million at the highest to 4 million at the lowest when the cooperation was terminated.
The relationship was severed more completely in 2019 – on April 30, the SEC updated information that ant financial no longer holds any shares in the store.
Luo min is abandoned by the capital, which looks like the old interesting store staff he cut off.
03
Luomin will not wait to die.
Perhaps influenced by Wang Xing’s borderless theory, qudian tried many new projects in 2018, such as online education, home economics, etc., but they all copied the results of those early entrepreneurial projects of Luo min.
Compared with the traditional players in these tracks, the fun shop is obviously too immature and rough, and looks like a upstart.
Take fun learning as an example. This project aims at 3-10-year-old children. It claims to recruit 50000 lecturers in one month after its launch. But soon, under the problems of high price promotion and rough curriculum, it came to an end. A former employee revealed that they were required to refer to the Internet and make PPT for 6 to 7 courses a day.
Home Economics project Weipu family also experienced rapid online and falling.
A former employee of qudian commented that it is necessary to dig a three meter well in the automobile and home economics industries to see the water, and qudian gave up after digging a meter.
It wasn’t until the third quarter of 2018 that Luo min found the new business for the upcoming “weaning” interest store, which he dubbed with the fashionable name: open platform strategy. In short, it is the interest store that diverts users with loan demand to financial institutions, and helps app with flow create consumer financial products.
In essence, this is the flow wholesale business.
Different from the car retail, home economics and online education fields that qudian has tried, this business does not need to cultivate a certain industry in depth. The key is to maintain the b-end users. This is clearly a better model for Luo min, who announced in May this year:
“In the future, qudian will terminate the business unrelated to consumer loans, continue to increase investment in the open platform strategy, and continue to expand the cooperation relationship with capital partners and user traffic end.”
As he used to find financing for fun by stages, he devoted himself to it with great enthusiasm, and making friends became his important mission.
He made full use of Xiamen’s resources.
In April 2019, Luo min obtained the status of investment consultant of Xiamen City, with a term of two years. He first published his appointment letter in the circle of friends and said that friends who want to invest in Xiamen can contact him.
An article praising Luo Minxin’s identity once listed the entrepreneur friends he received in Xiamen in May this year, including Chen Hua, the founder of singing bar, Yang Jun, the founder of squirrel puzzle, Wu Shichun, the founding partner of Meihua venture capital, Li Yinan, the founder of Xiaoniu electric vehicle, Dan Dandan, the founder of Fuyou truck, Liu Nan, the founder of Miya, Liu Chunhe, the founder of chizicheng and Wang, the co-founder of chizicheng. Xin Ming.

Among them, the singing bar is the first group of members of the open platform of qudian.
Open platform brings not only friends, but also new growth in financial statements. Q2 financial report in 2019 shows that the revenue of open platform business is nearly 400 million, accounting for 20%.
But the problem with the flow wholesale business is that, like insurance brokers, the best time is to start. When the flow around us is exhausted, if we don’t find a new flow access channel, we can only sit on the sidelines.
In fact, the open platform revenue of interest stores has shown a slowing trend.
According to the financial report, the revenue of the open platform business of qudian has increased by 435% from the first quarter to 150.8% in the second quarter.
There are also hidden risks.
Since CrO (chief risk control officer) left his post before IPO, the position of qudian has been vacant, which means that the risk control system of the company may not be so reliable, so how many users who guide financial institutions through open platform really have the ability to repay?
Obviously, this new story didn’t boost the confidence of the capital market in qudian. Although Luo min was very satisfied with the performance of Q2 in 2019, after the financial report was released, qudian’s share price fell sharply, reaching a minimum of $5.89, the lowest since listing.
And the traditional cash loan business of qudian is also facing growth pressure.
Since 2018, the growth of cash loan related businesses of qudian has slowed down, and the revenue has decreased from 3.642 billion yuan in 2017 to 3.536 billion yuan in 2018. In the 2019 Q2 financial report, there is no new growth point for this traditional business.
At the same time, risks are rising. External national policies continue to tighten, and internal overdue and bad debts remain high. The Q2 financial report shows that the number of outstanding borrowers of qudian increased by 11.9% from 5.4 million in the first quarter to 6.1 million in the second quarter.
Sitting in the East China Sea, Luo min can’t relax.
04
Luo min is a tough character.
It’s not easy for a poor family to have a baby. Zhu Tianyu, an early investor in qudian, was impressed by his strong sense of hunger. The ground pushing Iron Army that he cut off by himself used to be known as fast, and the way he used to do it first was to think again, “you rush up first, win and then think why the gun is wrong, the bullet is jammed.”
The side effect of “fast” is coarseness. In the early stage, only the front desk had no background, and orders could only be processed by Excel.
However, the rough and accurate direction of the fast, once the right time, the rise is also logical.
Romin is undoubtedly lucky. He realized the American wish to ring the bell when he put the Kongming light in Beidaihe in 2008, but it is obviously not enough to rely on “fast” to maintain the long-term luck.
This is also a kind of energy conservation in a sense – it only took three and a half years from its establishment to its listing, which means that there is still a long way to go to complete after its listing.
The capital brought by the secondary market is like a double-edged sword. It can provide enough ammunition for the growth of interest stores. On the contrary, it will enlarge the bad results caused by blind, rough and quick profit attempts.
Luo min should have a deep understanding of this.
Different from the blessings of normal company’s listing, he was criticized after ringing the bell. The original sin of campus loan is the essence that he can’t get rid of. The effort he tried to clarify in the story “funny shop Luo min responds to everything” was also regarded as a sophistry in vain by the public.
“For those who do not repay after the expiration of the time limit, we have bad debts. We will not urge them to repay our bad debts. They’re not going to be called. If you don’t pay back the money, you will be given as welfare. That’s it. ” ——”Funny shop Luo min responds to everything”
The prospectus of the interest shop published earlier gives different opinions. It not only discloses the detailed collection means on page 178, but also clearly states that there are only three circumstances that will stop the collection: the borrower’s death, being identified as fraud, overdue for more than 180 days or collection for a certain number of times.
Once upon a time, Romen tried to package himself as a good man, but he failed.
As he once said, it doesn’t make sense to be a good person. Compared with the pursuit of moral level, the success of secular meaning is the motivation to motivate him to never stop.
Fortunately, he is used to impermanence. In the last second, when you are in debt, the number game in the financial field is full of drama. You have to learn to live with impermanence.
Luo min became the least blessed bell ringer. In the next two years, he never found a new identity to replace it.
He tried to use numbers to prove that capital markets were falling back and forth.
He tried to use charity to prove that he had donated 1 billion yuan to establish a charity fund for students, which was mocked by the public opinion. “Reference to Hua’er Street” asked Limmer: would you like to accept the donation from Luo min to go to school? College and campus loans are waiting for you.
In fact, qudian has never really isolated the students from the borrowers.
He tried to prove it with new business, but he was frustrated all the way. Only the open platform can barely bear his hope for the time being, and it seems that this is not a good business that can last for a long time.
What did Luomin do wrong? The most likely answer is because he always thought he was right.
A person who pretends to sleep will never wake up.
Some sources:
[1] Luo min after ten billion dollars, Li Junyu, Liu Xueer, 100 people in the new economy
[2] 24 hours after qudian goes public: 10 billion US dollars, wealth finally cleanses the original sin, Zheng Yahong, Wang Li
[3] Xiamen freshmen in fun shop, Tong Wenli, 36 krypton
[4] interesting shop Luo min’s AB, Zhang Dongwei
[5] interesting store open platform: another flow realization game, Wang Hao, New Financial Highlights
[6] the cruel reality behind the salary of Luo min in qudian, Zhang shisan, the affairs in the Internet circle