This article is from WeChat public account:GGV Jiyuan Capital (ID:GGVCapital) OF: Jixun, editor: Yonnie, FIG from Oriental head IC

“In the past 20 years, we have focused on the market and opportunities that are centered on China and the United States, and to a large extent, the changes brought about by the Internet and the mobile Internet.Leather, as well as AI, 5G, new technologies to promote some subversive trends and changes in the market and industry. In Southeast Asia and India, the two major markets have nearly 2 billion people, and the changes have just begun. ”

As early as 2014, we started investing in Southeast Asia. Earlier, we invested in a company called Heptagon. The product is an optical component used in mobile phones. The core customer is Apple. This company is also based in Singapore. We invested in this project very early and brought us 500 million dollars in 2018. Return.

Grab is a project invested by GGV in 2014. Now it is called “Daily Southeast Daily Super App” by the media. The business involves online car, mobile payment, takeaway, express delivery, insurance and other fields. I and Jenny(GGV Jiyuan Capital Management Partner Li Hongwei) is a Singaporean, we grew up in Southeast Asia, understand the local politics, economy, geography Good and bad. I am no stranger to India. From 2000 to 2005, I ran India for ten or twenty times. Compared with the changes between India and China, there was still a big difference.

But in recent years, India has changed a lot. UPI, GST, JIO, etc. are all promoting the development of consumer and mobile Internet. In particular, GST has merged central and local taxes, unified split tax management, and reduced consumption in India. , economic and tax friction; the reduction of data costs encourages the use of mobile internet, and these positive measures will bring benefits to its future development.

In addition, information and Internetization in India and Southeast Asia are accelerating. This is a big trend. Southeast Asia and India do not have the opportunities brought by PC Internet in China in the past ten years, such as Baidu, Ali, Tencent, but they have the opportunities brought by mobile Internet, especially in recent years. In Indonesia, Southeast Asia, and India, we have seen the formation of some “unicorn” companies, but this is only the beginning.

Of course, we are still thinking about the layout of Southeast Asia and India. What is the core point of this move? Why is it right now, is the choice at this point in time correct? Why is this project, this entrepreneur? This is all the topic we need to keep exploring.

Today, the maturity of mobile internet in Southeast Asia has intensified, and users are accustomed to moving slowly to the mobile Internet. A few days ago, I saw a report from Temasek and Google. The daily consumption time of Southeast Asian users is widening. It is almost three to four hours a day for individual users, which is close to the level of China and even higher in some markets.

(Figure: Length of mobile users in Southeast Asia)

But when you go to see this market, what are the special factors to pay special attention to?

I think there are two points, one is the user’s spending time, and the other is the user’s Wallet Share, which is the user’s wallet. Whether the proportion of wallets can be moved online, this process will take time.

Now there is already a wave of e-commerce companies in Southeast Asia and India, like Flipcart, Snapdeal, Tokopedia, Traveloka and more. But this is a multi-cultural, multi-lingual, multi-religious fragmentation market, and the convenience of the entire infrastructure, transportation, and logistics is very weak. Taking China as a reference, the booming development of Chinese e-commerce relies more on the rapid development of high-speed rail and expressways over the past two decades, reducing the overall logistics cost and reducing the cost of e-commerce implementation.

In addition, we have seen that in Southeast Asia and India, the cost of compliance is relatively high compared to the customer price. It also means that the e-commerce needs to solve the last mile problem better. It may take a longer time to pave the way. It is not necessarily that small companies can do it. Things. Large companies like Wal-Mart and Ali will invest and acquire various businesses, and a startup that wants to make Ali will need a lot of money and time. It is not easy in Southeast Asia and India.

(Figure: grocery store in India)

There are interesting points in local consumption scenes in Southeast Asia and India. There are a lot of community grocery stores in the local area. These stores sell everything, such as rice, salt, shampoo and so on. This kind of grocery store is called “Kirana” in India and “Warung” in Southeast Asia. The form is similar to that of the Chinese grocery store in the early years. Now there are many four- and five-tier cities in China.

The shop owners have their own independent credit system. The people in the surrounding communities come to the store to buy things. They can take a bag of rice and leave. I know who you are and where you live. Based on the trust system of acquaintance circles, it is difficult for local e-commerce to quickly replace it. E-commerce may take longer to replace offline retail.

But, on the other hand, how many existing grocery stores in the area, how should we empower these “couples and wives”, grocery stores, and find value in the empowerment process? In fact, these grocery store owners are Power Buyer, Power Seller, that is, big buyers, big sellers, help these people to intelligentize offline purchase behavior, continue to help them accumulate their own resources on the basis of credit transactions, this model I think there is a good chance.

In addition, if you want to give a grocery store husband and wife shop, how can you expand in the future? Is it a pure B2B business, or can you do a flop in the future, plus a variety of value-added services? This has unlimited possibilities. This is a local opportunity that we are optimistic about.

(Photo: The locals call this store “Kirana”)

Also, We think India may have a special opportunity: “Global SaaS.”

India has a large population base and produces many engineers every year. Going to India to see projects in the early years, a large class of projects is IT outsource (IT outsourcing)