Exclusive interview with Huaxing Zhou Liang: Huaxing’s pursuit of change is behind signing a two-year contract with Mobike

Exclusive interview with Huaxing Zhou Liang: Behind the signing of a two-year contract with Mobike is Huaxing’s pursuit of change. The hot shared bicycle market has once again escalated in scale and intensity of competition as Mobike received a new round of financing.

On the fourth day of 2017, Mobike, the leading bicycle sharing platform, announced the completion of Series D equity financing of US$215 million (approximately RMB 1.5 billion).

Tencent and Warburg Pincus led this round of investment. Newly introduced strategic and financial investors include Ctrip, Huazhu, TPG, etc.; existing shareholders such as Sequoia and Hillhouse also participated in this round of financing.

In the current somewhat dull venture capital market, this round of financing by Mobike is a deal that is enough to attract attention, both in terms of the amount of financing and the background of the investors.

China Renaissance was the financial advisor for this transaction.

This is not the first time that China Renaissance’s name has appeared in the financing information of well-known new economy companies. As an investment bank established for more than 12 years, China Renaissance has participated in the financing of many new economy companies, including JD.com and Ganji.com.

In the wave of Internet mergers in 2015, China Renaissance's performance as financial advisor in the merger of Didi Kuaidi and Meituan-Dianping has also gradually strengthened this investment bank's position in China's Internet venture capital circle.

After receiving US$200 million in Series D financing, Mobike founder Wang Xiaofeng expressed his dissatisfaction (with the speed). In 2016, only five rounds were raised in one year. I hope to raise six rounds.

Compared with the financing speed of most companies, the financing speed envisioned by Wang Xiaofeng seems ambitious, but Huaxing is becoming part of this ambitious financing plan.

In this transaction, the cooperation between Huaxing and Mobike has subverted Huaxing's past style of doing things, but in the new environment, this may become the norm.

Zhou Liang, the direct person in charge of Mobike’s financial advisor, a director of Huaxing Capital and head of the private equity financing team who has been with Huaxing for ten years, told Tencent Technology: Huaxing will have more and more cooperation methods like this with Mobike. If

If the entire market is becoming more and more accepting of this model, I think it will become more and more common.

A Different Cooperation Model This time, China Renaissance not only served as the financial consultant for Mobike’s D round of financing, but also signed a two-year service contract with it.

In the next two years, Huaxing will become an important helper for Mobike to obtain external capital injection, continue to introduce high-quality capital, and in the field of shared bicycles, Huaxing will only serve Mobike.

Whether it is Mobike or Huaxing, this is an unusual way of cooperation, but Zhou Liang believes that this way of cooperation is a reasonable choice to cope with changes in the general environment.

What does it mean to be a financial consultant for two years? It means that we will be more deeply bound to China's best company in the field of shared bicycles, and we will be together for a long time in the future.

? Pulse financing was the main method of financing for most Internet companies in the past. Financing was considered only when money was needed.

With the rapid development of the industry, the demand for funds by outstanding companies has gradually become a long-term and continuous process. It is not uncommon to conduct several rounds of financing a year. Didi and now Mobike are typical representatives.

Under the short-term cooperation model, as a financial consultant for a single round of a customer, you need to have a very in-depth understanding and judgment of the customer in a relatively short period of time, and help the company find suitable investors and complete financing as soon as possible.

But if you extend the service time, you will find that professional financial advisors can provide customers with much more help than this.

Financing is becoming a continuous process. Since it is a continuous process, as the company’s exclusive financial advisor, we can actually avoid doing many short-sighted things in a relatively longer-term service.

? Zhou Liang explained.

Specific to actual operations, it includes how to avoid the inconsistency between the interests of FA and the company, and how to avoid the inconsistency between the interests of shareholders and management.

?We will give him a lot of capital and rhythm suggestions, and we will look at it from a long-term perspective.

For example, I may even suggest that this month is not a good time for you to raise funds, and it may be more appropriate to wait for another two months; or there may be a certain time, and when the business reaches a certain level, we think you will be more successful.

Well recognized by capital.

? Mobike seeks speed, so it chooses to reach a long-term cooperation with Huaxing, no longer using pulse financing methods, and will continue to contact and raise funds from investment institutions through Huaxing in the future; while Huaxing seeks change, Mobike is Huaxing's new business idea.

The first order, behind the change, are the challenges brought to the financial advisory industry by the constantly adjusting market environment.