VC Nuggets Auto Aftermarket: 800 million yuan for 1 year to second-hand cars

Li Jianshe is one of them. As the general manager of the Rio Tinto Group Fund, his main job now is to look for investment projects with his friends in the automotive aftermarket, and his previous career was related to car dealerships.
“Whether you admit it or not, now the auto aftermarket is in the best opportunity to establish a business, which is what we call the tuyere period.” Li Jian believes that after 5 years, the used car market in China will usher in the blowout period, and will be used. The sub-sectors of maintenance, maintenance, refueling, cosmetology, and cleaning that are affected by the car will usher in a boom in consumption.
A set of data comparing China and the US auto market is one of the drivers of these investors' keenness to the auto market. According to statistics, the current sales ratio of new and used cars in the United States is 1:4, while the figure in China is just 4:1. That is to say, China will sell a used car for every four new cars sold, which means that In terms of the replacement rate of new vehicles, China's market potential is far from being released.
The China Automobile Dealers Association once predicted that by 2020, the used car market in China will reach a scale of 20 million units. If the price of a car is 50,000 yuan, 20 million will be a trillion yuan. As used cars do not require services at all times, the aftermarket service industry that surrounds them will be one after another with a scale of several hundred billion yuan. And now there are five years away from the tipping point of these consumption.
In the past five years, the capital market seems to be the point in time when the industry is being laid out. "Generally speaking, venture capital companies have to wait for 3 to 5 years, so now many people are staking their positions in the auto aftermarket. Their goal is very clear. They are waiting for the blowout period after 5 years." Li Jianshe said.
Now, besides the multi-tiered capital market and the ever-increasing second-hand car market, the emergence of mobile Internet tools has undoubtedly contributed to this entrepreneurial boom. As an information interaction tool, the mobile internet has greatly reduced the cost of communication between customers and service organizations, and the one-on-one execution efficiency has been greatly enhanced. This has made the development of multiple industries in the automotive aftermarket full of imagination.
The third means that the enthusiasm of eliminating capital ignites people's entrepreneurial passion. Since 2013, Internet entrepreneurship around the automotive aftermarket has sprung up. Among them are large B2C platform websites such as Ali, Tencent, and Jingdong, as well as self-built e-commerce platforms for automakers, such as the SA station invested by SAIC, but more are based on entrepreneurial cars represented by cars, ants and prototypes. Companies, their “leaders” either come from the car circle or they cross IT.
With the introduction of the "Guidance Opinion on Promoting the Transformation and Upgrading of the Automobile Maintenance Industry and Enhancing the Service Quality" jointly issued by ten ministries and commissions, the trend of this entrepreneurial business will intensify. Huang Yonghe, director of Automotive Industry Policy Research Office of China Automotive Technology and Research Center, predicts that in the future there will be a large number of large-scale spare parts enterprise groups with independent trademarks and independent operations in China. They will also use the e-commerce platform to reshuffle the industry.
The loosening of mobile Internet and policies has lowered the threshold for entrepreneurs to enter the auto market, but at the same time, this entrepreneurial game in this staking-enclave is extremely fierce. Li Jianjian told reporters that the average number of entrepreneurs who fell by the P2P model every month in 2014 was about 60 or more. However, for investors, if there is only one successful investment in 10 projects, you can Get a substantial return on investment.
In order to attract the attention of investors and enable start-up companies to continue to survive, the competition between them is also extremely tragic. One of the most typical cases is the contest between car auctions and excellent shots in the used car market. The two online companies operating second-hand car e-commerce transactions, from the beginning of the game on the ranking data secretly competing. This summer, Che Yip even took the data of You Xinpao seriously degrading its actual trading volume and turnover rate and put it to court. For them, whoever is the oldest in the field will be able to get more financing, so in a sense, ranking means survival and development for emerging companies.
"For start-up companies in different fields, only the top two are the most hopeful to get the favor of capital, so even if you have already reached the third place in a certain area, it will be on the verge of elimination." Anonymous Industry insiders told reporters that under the same business model, the timing for entrepreneurs to enter is very important. This is why the number of entrepreneurs in the post-market market has soared. Everyone is afraid of losing the initiative.
There are many business models for people who get the data. Nowadays, more and more post-market entrepreneurs choose to cut through O2O channels. This is indeed a simple and easy-to-implement business approach, but simplicity also means it can be easily copied.
"Originally, Internet companies are tall companies in the eyes of entrepreneurs. They focus on platforms and they are not grounded. However, with the proliferation of mobile internet users, these companies have also begun to penetrate offline, which undoubtedly gives entrepreneurs It brought pressure," said Li Jianshe.
One of the most typical examples is the websites of Goji.com and 58.com, which used to publish information in the past. Now they are also doing home cleaning services. Compared with start-up companies, their advantage lies in the accumulation of certain data before. The lack of data is currently an obstacle to the further development of automotive aftermarket startups.
Take maintenance as an example. Although start-up companies can provide door-to-door service for users according to the order of the app, if the company does not have driving data of the owner and does not know when the car owner needs to provide maintenance service, the company’s outcome is only one: The huge cost shaped the brand advantage, and then competed with thousands of roadside shops for cost structure and price advantage.
Therefore, Internet companies represented by Tencent chose to start with the OBD Lobo Box, collect driving data, and then target the market afterwards. However, this does not mean that the startup company has no chance to win. Some data-dependent companies are now growing very fast. They can provide some data for start-up companies, but this requires cost.
Of course, startups can also choose to build their own CRM system and build closed-loop information, creating a data ecosystem like Ali, but this is a project with a very high degree of difficulty, and investors may not have the patience to wait. Therefore, Li Jianshe believes that in the future, startup companies can share data by doing group experiences.
"Perhaps the group that you are operating in is mainly cosmetic, and it has nothing to do with the car aftermarket. But what does it matter? The majority of the people who make beauty will also have cars, so when you run a product, you can completely Customers do swaps. In the big ecosystem, Big Data will be able to communicate with each other in the future. This is the consumer trend brought to us by the mobile Internet, said Li Jianshe.