The title picture comes from Oriental IC
After more than three months of struggle, the founder of Taoji Ji Zhang Zhengping today announced the bankruptcy of Taojiji with an open letter.
Zhang Zhengping said in the open letter that he “has done his best but did not do his best”, because the funds failed to arrive on time, he had to declare that Taoji Ji failed in this round of mergers and acquisitions, and the company will then seek bankruptcy liquidation or bankruptcy reorganization.
For the subsequent reorganization, Zhang Zhengping said that he would transfer the ownership of Taojiji to the creditors. “If the creditors need it, the senior management team and I will continue to serve Taojiji. If not, the senior management team and I will leave Taotao. Jiji. “And if the above bankruptcy reorganization plan cannot be implemented, it will apply for bankruptcy liquidation, but they and their team will still work hard to return the arrears.
As one of the most dramatic cases ending in 2019, what will the Tao Jiji, which will gradually disappear from people’s vision, leave behind a group of startup companies on the field?
Taojiji Thunderstorm
The thunderstorms in Taojiji began in the second half of this year. In September, Taojiji was exposed that the capital chain was broken; in October, Taojiji announced that it would conduct business restructuring with large domestic institutions. (The model is adjusted to the partner’s own model) , on October 16, Taojiji released a settlement agreement with a small number of merchants: Taojiji handed the funds to a third party for supervision, and the merchants agreed to sign a “debt-to-equity swap” “protocol.
On December 3rd, Taojiji also announced that it has successfully signed equity investment agreements with large domestic groups and is in the stage of waiting for funds. But a few days later, the status of the money has become a delay, and Taojiji issued a final announcement.
For the B round of financing funds that have been waiting for a long time, Zhang Zhengping disclosed in an open letter that there were two potential investors in this round of auctions, and they started to communicate around National Day, among which investors have signed Completed the investment agreement and took over the company’s financial and legal work The time of the loan was finally beyond the time limit that the company can bear.
“Without the money available on the company’s books, the basicOperations, and was very skeptical about whether investors would make money, so they were forced to announce the failure of mergers and acquisitions. “
The B round of financing to start the sinking journey of Taojiji was launched in June this year. At that time, Taojiji planned to raise 200 million US dollars, and the post-investment valuation was 800 million US dollars. At that time, Taojiji also declared that it would become a company with more than 10 billion US dollars.
According to the interface report, Taojiji at that time had indeed reached an agreement with the investors, but the funds were not yet received. This was because investors required Taojiji to have a better growth curve. For this reason, Taojiji did not hesitate to embezzle the merchant’s payment as a market growth fee, which finally caused a disturbance in October this year when merchants came to hate arrears.
Prosperity in financing, death in financing
Taojiji was launched in August 2018, providing demand for multi-category products including clothing, food, mother and baby, and digital products. People are no stranger to it: With the help of WeChat ecology, users can buy products on the platform at low prices after participating in group fights or bargaining in acquaintance relationships.
Based on the fission of social relationships, Taojiji also uses the most basic models of social e-commerce, such as direct cash subsidies and distribution rebates. Compared with other platforms, Taojiji has a more aggressive low-cost strategy. The 9 blocks 9 on other platforms will become 8 yuan 8 on Taojiji, even lower than 1 yuan, 0 yuan, etc. Price of (Taojiji has a single market) . Another example is that it is used to pull new “earn money” functions, which can guarantee users “how much to buy and how much to return.”
Because of the keywords of bargaining, socializing, grouping, sinking, and the speed of its rise, Taojiji was once called “the next lot of lots”. However, within one year, Taojiji has obtained 130 million users. (data as of October this year) , and data show that the entire sinking In the market, the overlap between Taojiji and Pinduoduo was as high as 55%.
Capital is rushing towards it: In October 2018, Taojiji announced its first A round of US $ 42 million financing after it went online, invested by Tiger Fund, DTSGlobal, and Yanfeng Cowin, with a valuation of 242 million US dollars. This is already a significant amount in the financing case of social e-commerce.
In addition to Taojiji, the impact of capital on the field of social e-commerceStraight up. Some e-commerce research center data show that in 2018, the total amount of social e-commerce financing exceeded 20 billion yuan.
However, Financing brought a highlight moment to Taojiji, but it also laid a foreshadowing for its today’s results-Zhang Zhengping attributed Taojiji’s death to “financing”.
In the October apology letter, Zhang Zhengping said: “I made a great mistake and spent too much time on financing. I want to solve the current growth problem through financing funds, which is delayed. The most golden self-rescue period, strategically chose to continue to lose users to acquire users. “
I just want to use financing to solve everything, without really thinking about where the company’s own growth should come from. The consequence of this is that it ignores the remedy for losses, until the end of the year, Taojiji did not form a real Self-hematopoiesis. In other words, before we really started making money, Taojiji ushered in a crash across the board.
The failure of financing is probably an introduction. The real reason is that Taojiji, which is too dependent on financing, has not run through its own model.
Hematogenesis is important
Although capital once broke the threshold to enter, Taojiji always needs money.
Mode, Determining that Taojiji needs to always use high costs, including cash subsidies, to acquire customers and maintain retention, This has caused its costs to be too high and unable to equalize. In other words, Taojiji is actually a “one-time” business. As Zhang Zhengping himself said, “ It is not cheap to get a registered user in the market. Taojiji does not charge commissions, and the losses are actually lost on the customers. ”
Late Late Post disclosed that Taojiji has lost nearly 1.2 billion yuan this year: a net loss of 600 million yuan in the first half of the year, a net asset of negative 600 million yuan, and a monthly loss of more than 200 million yuan. There is also public data showing that Taojiji has a total loss of 1.6 billion.
The explosion of user numbers in the short term does not mean that users have loyalty, can be retained for a long time, and the platform model can be verified. The severe loss of Taojiji also reflects the phenomenon that the social e-commerce sector still uses the money to occupy the market, but the business model cannot run through.
The user groups of Taojiji used to be highly coincident with Pinduoduo. They all surround the sinking of this new nugget resort. China’s sinking market has more than 600 million users.