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Ruixing ended the myth of burning money for subsidies in exchange for growth.

One year forward, the sharing economy, once labeled as free and low-priced, has risen.

The price of shared bicycle platforms has been adjusted one after another, and the cost of one ride almost catches up with the bus; Didi raised the starting price of the Beijing online car rental to 14 yuan during the peak period last year; the shared charging treasure rose from a dollar per hour to the highest 8 yuan.

Online video platforms charge “advance on demand” among VIP members. Tencent video and iQiyi are accused of being unsightly.

Even during the epidemic, the commission increase in the takeout industry quietly rose. In response to the dissatisfaction of the merchants, Meituan Takeaway responded with “have to face huge loss pressure”.

With the popularity of mobile payment, the Internet that people used to be full of free services is completely gone. Instead, there are more and more and more expensive charging items, memberships and annual fees.

The number is the answer to capital satisfaction

Chris Freeson, author of “Free: The Future of Business,” once described “Internet-free” as “not one of the options, but an inevitable choice.”

After Yahoo started as a navigation website and created free information services by charging webpage advertising fees, in the era of PC Internet in China, the Internet fields such as search engines, software antivirus, portal news, and online games have all emerged with such free strategies.

With free anti-virus software and browser, Zhou Hongyi gathered a large number of users for the early stage of 360 and became the biggest fan of free strategy;

Giant Network uses “Journey” to use the game for free, which lowers the player’s game threshold and expands the online game plate, so Shi Yuzhu has gained a place on the Internet;

In the mobile Internet era, the O2O entrepreneurial wave will carry forward free of charge and subsidies, sending it to the climax. But in the end, it turned out to be a downfall-offline products and services are not nearly zero cost as online.

Burn the investor’s money, the hearts of the users. Most Internet companies subsidize users’ real money, which comes from non-stop financing consumption. In other words, money cannot be burned without “capital”.

Rui Xing, “please invite people across the country to drink coffee at low prices”, CEO Qian Zhiya once said “will continue to subsidize for three to five years, and currently does not consider profitProfit, “CMO Yang Fei publicly shouted,” There are always competing products hoping that we stop subsidies, don’t have this hope. “Behind the pride, the three rounds of financing completed in less than a year by lightning totaled $ 550 million. The fundraising of 695 million US dollars is also regarded as a powerful ammunition to maintain subsequent expansion.

Yan Long, a person in the car-hailing industry, said to Yiou, “Didi was able to get a lot of money to subsidize at the time, also because Alipay and WeChat were still in the mobile payment battle. Tencent is looking for a very good mobile taxi To pay for the incision, so for Didi financing, there is also the habit of letting Didi spend money to buy users using WeChat payment. “

In the field of shared bicycles, ofo and Mobike in the bicycle war, ofo totaled 10 rounds of financing in two years, and Mobike completed 9 rounds of financing in 2 years. According to statistics made by the China E-Commerce Research Center, as of the end of 2017, the shared bike platform received more than 17 billion yuan in capital financing.

During the period of rapid expansion of the shared charging treasure industry, it has set a record of a financing amount of up to 1.2 billion yuan in 40 days, which is five times the amount of financing obtained in 2015 when the shared bicycle appeared.

“Financing-Burning Money Expansion-Refinancing” has become a strange circle that is difficult for Internet companies to break.

“B round of death” and “C round of death” presage the end of some companies. In a subdivision track where products are homogenized, the profit model is vague, and competition is fierce, capital has increasingly higher requirements on the financing nodes of rounds B and C. Once many companies have difficulty in financing, the subsequent round of money-burning subsidies will also fall through.

At the same time, some subsidies did not enter the hands of users as companies imagined. Swiping bills has become a recognized secret, and the act of sweeping bills seems to have been acquiesced. The growth of numbers seems to be the answer to capital satisfaction.

Urgent profitability

“We can’t get to this step without burning money,” Liu Qing always went through the trick of burning money with Jiedi Di.

Shi Tianhao, a veteran of the Internet industry, believes that when the Internet transforms traditional industries such as retail and catering, there are huge business opportunities. At that time, the speed and market occupation of a company were considered.

Burning money is also periodic. “If the industry is still in a fiercely competitive stage, subsidies will prevail. Multiple giants will continue to burn money until one of them is killed. If the company is already listed, there will be profit pressure. Like Didi, although there is no There is no financing pressure for listing, but it is still losing money and there is also pressure for profit. “

After several years of investment, capital has also begun to demand investment returns from companies. In this situation, the “free mode” has a dead end.

Online video is the most resolute attitude among Internet companies, because the copyright fees of film and television dramas have risen in recent years, and video platforms cannot rely solely on advertising revenue to cover the cost of purchasing or homemade dramas, let alone making profits.

Tencent hit drama “Chen Qing”