Interpretation Of Investment Trend Of Pan TMT

Trend 1: 2C consumer Internet investment declines and business service opportunities emerge

From e-commerce and o2o to takeout, taxi, bike sharing and power bank sharing For a long time in the past, TMT investment mainly focused on business model innovation in the field of consumer Internet. Every two or three years, there will be a distinct wind outlet and investment cycle, and many famous unicorns such as meituan and didi have also been achieved.

However, due to the disappearance of demographic dividend, there are fewer and fewer opportunities for consumer Internet investment, and the rise of new platform enterprises is becoming more and more difficult. At the same time, the enterprise service market investment is brilliant, which has become the focus of attention of IDG capital, Jinshajiang venture capital and LanChi venture capital.

From the perspective of demand side, due to the rise of human cost, the demand for cost reduction and efficiency increase and the value of enterprise software increases. Since this year, the epidemic factors have also increased the demand for enterprise services in remote office and cooperation. From the supply side, the application of new technologies such as artificial intelligence and 5g will bring more opportunities for service innovation of enterprises.

Trend 2: investment standards change, from encouraging money burning expansion to pursuing healthy financial model

As for TMT, it was a subsidy mode for enterprises. To be specific, start-up companies in the early stage of financing to VC firms, through burning money subsidies to seize market share, cultivate user habits. It is expected that after the company becomes the industry leader in the future, it will make profits through the scale effect and finally be listed successfully. And VC firms withdraw smoothly after they are listed on the market.

In this mode, product quality and cost control are not even the core elements of success. Financing ability and capital utilization efficiency have become the most important factors for enterprises. It is undeniable that this model has made meituan and other companies through the difficult stage of early entrepreneurship. But there are also a large number of start-up companies, because the follow-up financing can not keep up with, the business model has always been unable to run smoothly, and investors have lost their money.

When the financial model is more prudent, investors will be more cautious when they start to pursue the financial model. What is the capital utilization efficiency of the enterprise and when can it bring stable and sustainable positive economic benefits? These problems become the focus of TMT investors.

Trend 3: Science and technology investment meets policy dividend, new infrastructure injects new power into PE / VC market

Since 2019, the reform of the registration system of the science and technology innovation board and the gem has brought a more smooth exit channel for PE / VC companies, and the early investment institutions in the field of science and technology have become one of the beneficiaries. In the first half of this year, the global IPO market was affected by the epidemic, and the trading slowed down, and the domestic A-share IPO growth momentum was strong. In the view of investors, the confidence of the capital market is transmitting from the secondary market to the primary market, which is expected to be reflected in the fund raising and investment performance in the second half of this year.

From the macro-economic perspective, the meeting of the Standing Committee of the Political Bureau of the CPC Central Committee in March this year stressed the need to speed up the construction of new infrastructure such as 5g network and data center. The major themes of the new infrastructure include 5g infrastructure, UHV, intercity high-speed railway and intercity rail transit, new energy vehicle charging pile, big data center, artificial intelligence, and industrial Internet. Among them, 5g, new energy vehicles, data center, artificial intelligence, and industrial Internet are all the plates widely distributed by PE / VC companies in the past.

The core of the new infrastructure is scientific and technological innovation, whose strategic significance lies in accelerating the transformation from industrial economy to digital economy. For PE / VC companies, in the process of promoting the new infrastructure, enterprises in the fields of chips, sensors, data platforms will usher in rapid development; the new infrastructure will bring about the upgrading of digital infrastructure, and the application of innovative products in many fields such as AR / VR, smart car, smart home will usher in a new chapter.

Trend 4: the epidemic situation accelerates the determination of industrial digitization, and some track enterprises realize the development speed up

The severe new pneumonia epidemic in the first quarter made it difficult for the fund to carry out due diligence on projects, a large number of new investment transactions were forced to be suspended, and investment institutions also shifted their focus to the management of invested enterprises. However, in the field of TMT, the epidemic situation has changed the working and living habits of users, corresponding to the rapid growth of some subdivision track enterprises such as remote office and fresh e-commerce.

From the perspective of broader industrial upgrading and transformation needs, the emergence of the epidemic situation and the continuous forced business owners to face the challenge of cost reduction and efficiency improvement. Many fields and enterprises related to industrial digitization and enterprise efficiency improvement are ushering in new opportunities. In the process of digital transformation, enterprises need to adapt to market competition by means of technology and digital management. On the one hand, it will involve the application of big data, database, cloud computing and other technologies, and on the other hand, it will promote the rapid development of enterprise service industry. At the same time, it will bring opportunities for further investment in the field of digital technology and services.

Trend 5: industry professional funds break through and establish high-frequency interaction with industrial companies

In the past few years, on the basis of the establishment of industry specific funds in various fields, investment institutions are carrying out more in-depth cooperation with leading enterprises in various sub sectors. Different from the once hot "PE + listed company" mode, the effect of which is yet to be verified. Nowadays, PE / VC firms attach importance to independence in cooperation with industrial companies and individuals. The cooperation with industrial LP is mainly reflected in the demand of industrial ecological construction and the empowerment of invested enterprises, except for the level of fund contribution.

The industry professional fund itself is also evolving, and the typical feature is to further refine the focus area. Taking the pan TMT field as an example, only the science and technology related fields have appeared the boutique fund which specializes in investment in enterprise services, data intelligence, education and technology, etc. From the perspective of independent decision-making and industrial resource network, this kind of fund is usually established by a team with both industrial and investment background. The fund investors are composed of several industrial companies and executives, but they do not absolutely rely on one of the investors.

Trend 6: technology giants compete for CVC and become an important participant in TMT investment

Many technology companies that rely on capital support to develop and grow are beginning to "feed back" to more start-up technology companies. According to the data provided by Qingke Research Center, according to the statistics of investment amount, four of the top ten institutions in Pan TMT investment scale from July 2019 to June 2020 belong to CVC (corporate VC) type. These companies are Tencent investment, Microsoft venture capital, Volkswagen and didi.

In addition to the four companies mentioned above, the list of technology companies investing in TMT is expanding, including Alibaba, Xiaomi, Jingdong, and headlines. Compared with traditional investment institutions, they have obvious advantages in TMT investment. First of all, in terms of capital sources, CVC can use its own funds for investment, so the pressure of fund-raising is not as big as that of traditional VC, and it does not need to be limited by the investment period. In terms of investment, CVC companies often have many years of accumulation in the industry, and have deeper industrial insight and industrial upstream and downstream resources than VC, which is conducive to investment in projects and help projects.

However, entrepreneurs will also have certain concerns when accepting CVC Investment: the competition in TMT field is fierce and the phenomenon of standing in line is very obvious. If an enterprise chooses to accept CVC investment from one giant, it may also mean that it will become an enemy with another giant and lose the possibility of future business cooperation. It is obvious that the advantages and disadvantages of CVC are constantly changing, and the competitive relationship between them and CVC is also obvious.