"Shared bicycles?" Zhou Yujie's heart moved. This year, shared bicycles will enter the public's vision for the first time.

To a certain extent, shared bicycles will also be a small link in the payment system, but Zhou Yujie has no intention of investing directly.

The first is that this market can only last for a few years, and it will still shrink in the future. With the speed of economic development, the possibility of choosing online ride-hailing will be greater when traveling in the future, unless the distance to the destination is very close, so close that it can be reached by walking.

The second is that shared bicycles are heavily asset-heavy operation investments, which is different from online car-hailing.

Online ride-hailing companies only need to build one platform and optimize algorithms, while other cars, labor, and car maintenance are not platforms. However, shared bicycles require a large number of golden locations to purchase bicycles, labor costs, bicycle maintenance, etc., and the investment required is in units of billions of dollars.

More importantly, there are almost no competitive barriers in this industry, and any player can participate. In the end, it will become an endless money-burning war. The fundamental reason for the bankruptcy ofo in later generations is the big problems that arise after burning money.

Zhu Xiaohu said: "In fact, it is also a new company called ofo that is on the Shanghai Stock Exchange, and it is also a college student who started a bicycle sharing project.

The founder's name is David, a student of Yenching University. He started to carry out bicycle sharing projects within the school last year. Now, he has entered several universities in Shanghai.

The profit model is also very clear. Students take out the bicycles and share them, and then the ofo platform is operated, and other students are rented. Then the rental is divided equally with the students.

The profit in this area is actually not high, but if you want to rent a car, you have to pay a stable rent. Now the market in several schools has been formed, and many people have not refunded it after paying the rent. This has led to millions of deposited funds on the ofo platform, which is only about interest, and there are tens of thousands of dollars a month.

If this model goes outside the school, then the accumulated funds that can be gathered will be terrible. Mr. Zhou, your understanding of the business model is recognized as the first. I don’t know how to view this shared bicycle business?"

"It works in schools, but it's another thing outside of school." Zhou Yujie nodded and said, "College students in prestigious universities are generally of high quality and will not maliciously damage or even steal bicycles, but it is completely different in society.

The second is the rental cost. It is not a problem to put bicycles at school, but it is not possible outside of school.”

Zhu Xiaohu said: "We have also considered damage and theft. We can install GPS, and each car will also be bound to users who have been used before. Traceability should not be a problem. The cost of doing so will increase a lot, but it should be controlled within an acceptable range.

As for the venue, ofo adopts a random parking mode. When other users search, they can search for the location of the nearest bicycle nearby."

"Did you take into account government departments in this model? There are bicycles everywhere, and it will definitely not be the solution after a long time." Zhou Yujie shook his head and said.

Zhu Xiaohu said: "For this, we can use algorithms to lock the location of the GPS. If it is in some inconvenient places, people will be arranged to clean it up. The previous user will be prompted by a text message. If there are multiple more times, additional charging measures can only be taken!"

"This is OK, the cost will be much higher, but what I want to ask is, what is the real advantage of ofo? If someone else also invests in this industry, what should I do if I burn money?"

"There is no big competitive barrier in this industry." Zhu Xiaohu said seriously: "The only barrier is capital and time. As long as ofo first invests in occupying the golden position of the city in the early stage and develops user habits, the cost of the latecomers will naturally be greater.

As for burning money, everyone is actually burning, it depends on who can get more funds!"

"How much money does ofo need?" Zhou Yujie didn't worry about the operational issues anymore. Anyway, he knew that companies with this model could not last, but the value in the middle was still good.

Zhu Xiaohu said: "Ofo has been invested by us for $3 million. Now they are starting to make arrangements on the Shanghai Stock Exchange. Naturally, the more funds the better. However, I still hope that ofo can obtain Quxin's traffic entrance."

"Quxin's traffic entrance is not available for the time being." Zhou Yujie shook his head and said: "Ofo can be an official account. I can give certain discounts in terms of promotion costs, but Toutiao's traffic is OK."

Not everyone can get Quxin’s traffic entrance, because too much traffic will affect the user experience.

If you want to join Quxin, then it must be a software with a huge demand, rather than a small software that will grow into a giant after joining Quxin.

As for Toutiao, there is no scruple in this regard. The strongest part of news software is that advertising is much larger than social software.

Zhu Xiaohu nodded and said, "That's fine. This time ofo is preparing to raise another US$10 million and give up 20% of its shares. If Toutiao is willing to agree to this price, ofo will only support Quxin Payment in the future. However, if ofo's scale will grow one day, I hope Mr. Zhou can consider Quxin's interface issue."

"Let's talk about it later. If you really become the first in the country, then it's okay for Quxin to give priority to pushing ofo's official account." Zhou Yujie nodded and said.

Ofo's current valuation may not reach US$50 million, but Zhou Yujie did not lower the price, because if such a company wants to develop to a sufficient level, it must require sufficient funds. However, if you ask for too much equity, it will affect the founder's mentality.

This is how Son invested in Yahoo, which also led to one of SoftBank’s most successful investments. Zhang Lei of Hillhouse Capital also forced to give enough funds to Liu Qiangdong because Zhang Lei knew that the money he gave was not enough money for the other party’s strategic plan, so it was likely to be completely wasted. If he gave too much, once the other party’s strategic goal was achieved, the returns would be very terrifying.

Ofo, in fact, I didn’t want to get any high proportional returns when investing in ofo. It would be enough to make it a part of Quxin Payment.

Zhu Xiaohu was also a little surprised at Zhou Yujie's attitude, but he didn't show it. He asked, "Will Mr. Zhou meet this David?"

"No need." Zhou Yujie smiled and said, "Let's talk about it when he has achieved certain results."

"It's OK." Zhu Xiaohu nodded and said.

...
Chapter completed!