The "capital pusher" behind Li Ziqi's explosive popularity

The life of Li Ziqi, who climbs mountains, cuts wood and catches fish, embroiders mountains and rivers in Sichuan, and sings and dances around the stove,......, has attracted fast-paced urbanites and gathered the attention of capital in a short period of time.

The "cold" capital seems to have found the "warm" road of realization.

China Envision Capital, when Li Ziqi had only hundreds of thousands of microblog followers, paid attention to the company behind his operation, Weinian Technology, and became the latter's A-round lead investor. Recently, CIC conducted an exclusive interview with China Envision Capital to explain the development of Weinian from an MCN company to a new consumer brand communication group.

Regarding the logic of investing in Weinian, China Enlightenment Capital said, "In addition to focusing on the scarcity of celebrities such as Li Ziqi, we are also optimistic about Weinian's high-quality content production capacity, unique operational thinking, brand scaling ability and in-depth layout of the supply chain."

So, after looking at more than 50 MCNs, the project leader of Huaying Capital caught up with Liu Daxiong, the founder of Weinian Technology, on his way back to Hangzhou on the high-speed train, and confirmed his investment intention on the same day.

"We don't feel that capital is necessarily eager for quick success, and we don't feel that capital logic should be cold." Huaying Capital said, "What we care about is to really do a good job with the content, tell a good brand story, and think about how to break through the ceiling of MCN."

In an interview, Li Ziqi once said that the reason why she got involved with Weinian is because the organization understands and tolerates her, and is willing to give her more time to grow up together, accompanying her to politely decline tens of millions of dollars of advertisements to do more meaningful things.

For Li Ziqi, taking ads is obviously the fastest and easiest way to make money, but her and Weinian's goal is much more than that.

Currently, most MCNs in China still focus on advertising and marketing, but the potential for content e-commerce is gradually being unleashed, and its share in the revenue mix of major MCN organizations has increased. Micro Nian Technology, which claims to be an "early starter", is currently earning more than 70% of its total revenue from e-commerce.

MCN (Multi-Channel Network) is a company that has the ability and resources to help content producers produce continuous output and promote cash. At present, the overall scale, industry and presentation form of China's MCN industry has long been far beyond overseas, and the overall market scale has reached tens of billions of dollars.

"If you just rely on traffic conversion e-commerce or purely pick up implanted ads, the commercial ceiling is very low." In Liu Daxiong's view, the commercial exploration of the micro-idea technology is mainly centered on consumer brand incubation.

Huaying Capital believes that MCN organizations that can rely on content to incubate consumer brands can really break through the ceiling and "do something different."

"Li Ziqi, with more than 40 million fans across the network, and Lin Xiaoyao, with more than 30 million, have formed a system that starts from 0, relies on content and the ability to buy and distribute traffic across the network, and cultivates mega-celebrities at low cost and fast." Huaying Capital said, "In the end, the biggest difference between a valuable MCN organization and the individual studio of a single big netizen is the reproducibility of the netizen and the height of the ceiling."

Huaying's investment vision for Weinian has also been continuously verified in the subsequent financing. Subsequent investors in addition to VC institutions, there are also Sina Weibo and Mango Cultural and Creative Fund, such as the platform type of investors. At the same time, whether it is the strategic cooperation between Weinian and Cat's Eye Entertainment, or Li Ziqi's strong alliance with the Forbidden City Foods and National Treasures, all of them have constantly verified Weinian's ability to operate in the brand.

Liu Daxiong disclosed that the future positioning of Weinian Technology is a new consumer brand communication group, which will continue to seize the "front-end flow" and "back-end supply chain" two main lines: on the one hand, continue to incubate, signing, and resource replacement through the layout of the On the one hand, we will continue to lay out the KOL matrix covering the head to mid-range through incubation, contracting and resource exchange; on the other hand, we will further enrich the product and brand matrix in the supply chain on the basis of providing high-quality content.

In other words, "the next Li Ziqi" is still expected.

In response to the recent discussion about Li Ziqi, China Enlightenment Capital said, "China Enlightenment invested in Weinian at a very early stage, and witnessed their iteration from an MCN company to a new consumer brand communication group. In order to do a good job of having a viable brand, Weinian has always been clear that it has to use Li Ziqi's own native state of life as a source to portray a more authentic brand image. As for concepts such as cultural output, it is not a key point that Weinian wants to emphasize, causing discussion perhaps only because the desire for a better life, the love of life, is the same language as the human race **** just."

Redditors as traffic content, with advertising, selling traffic, open Taobao store with goods are very common, but really want to rely on the individual person to set up a consumer goods brand is not easy.

"Li Ziqi's competitiveness, in addition to the premium of the personal brand, the strict control of the source of goods is also one of the barriers. This set of playing method and logic of Weinian is copied to other KOLs at the same time, and the value of this company will be very high if it can expand from a brand to a brand matrix." Huaying Capital told InvestmentNews.

"It's important how the IP maintains longevity, and the timing of the realization is critical. At the same time, IP will obviously bring longer life cycle and growth for brands."

The key to achieving control over IP is the strong content capabilities of MCN organizations.

"In a sense, content producers such as KOLs are the form of IP that revolves around people in the Internet era." Huaying Capital pointed out that content is generated through interaction, and interaction is driven through content, and transactions occur naturally in the process.

In 2019, content and consumption, like the two ends of a rope, are gradually approaching.

However, the fading of the traffic dividend has become an undeniable fact, and the competition for user attention by various players continues to escalate. Public data shows that in the whole of 2018, the number of net additional mobile Internet users in China exceeded 40 million, but in the first three quarters of 2019, the number was only 2.38 million.

At the same time, short videos and comprehensive e-commerce are leading in the share of users' usage hours, constantly devouring the space of online hours of other types of software, such as timely newsletters and long videos. Short video and comprehensive e-commerce strong combination of e-commerce and consumption have played a very big role in promoting, can occupy the flow of the entrance is nearly inevitable.

Li Ziqi from the food ancient style video to the Oriental food brand to achieve the realization of the pathway is also implicit in this trend.

More than a hundred short videos have brought 20 million microblogging fans, 7 million Youtube fans, and tens of millions of dollars in sales for the Tmall flagship store of the same name on the day of the double 11th - the aggregation of content on the flow of traffic and the transformation of the role of the obvious.

Huaying Capital judged that in the future, content and consumption will continue to be y integrated.

On the one hand, content is increasingly e-commerce. Jitterbug and Shutterbug have an amazing scale of carrying goods in 2019, and GMV is expected to be at the level of hundreds of billions of dollars, and the platforms are also continuing to boost the achievement of conversion by creating festivals, supporting anchors, and shortening the transaction chain.

On the other hand, e-commerce is gradually contentized. Taobao live in 2019 has a GMV of 200 billion, double eleven more than 100,000 merchants broadcasting, Pinduoduo continue to deepen the content strategy, through the game play to make the shopping behavior more viscous, in the standard "Disney" on the road all the way to run wild.

MCN's ambition for Disney is the same.

According to Crowley statistics, as of December 2018, the number of domestic MCN organizations has exceeded 5,000, and more than 90% of the head of the red man by the MCN company in the bag, or set up their own MCN company.

"MCNs, on the other hand, mainly realize cash through advertising and marketing, platform subsidies, content e-commerce, course sales, derivatives sales, IP licensing, and so on. The companies usually have better cash flow, but similar to the film and television industry, whether they have the ability to consistently produce pop stars needs to be focused on and monitored." Huaying Capital told InvestmentNews that MCN should have comprehensive strength in all aspects in order to elongate the life cycle of KOL, ensure continuous good content output, maintain a certain degree of influence and traffic transformation.

Compared with previous years, the financing of MCN in 2019 is not hot.

CVSource Casting data shows that in the cold situation of the entire entertainment field, there were only 35 financing events for domestic MCN organizations in 2019, only 44% of 2018, with a total financing amount of RMB 21.9 billion, mostly in angel rounds, seed rounds and other rounds.

The anxiety of the race for cash has seeped into all ports of the industry chain.

However, IP development is something that can't be rushed: from arousing ****sing to value recognition, from cultivating synergies between industry chains to continuous incubation and the formation of new products, every step of the way is a moat built up over time.

In the era of "fast red, fast cash", Li Ziqi took a different path. As summarized by Huaying Capital, "So far, he doesn't accept advertisements and rarely attends events, and the team puts polishing the content and focusing on the brand itself in the first place."

The popularity of Li Ziqi's "idyllic poem imagination" not only hits the pain point of urbanites' idyllic poem imagination, but also focuses on the revival of traditional culture in recent years.

"Twelve Hours of Chang'an", "Yi Zhuan", "Qing Yu Nian" and other phenomenal works in the past year or two, the ancient costume theme accounted for a considerable proportion of the "I'm in the Forbidden City to repair the cultural relics", "National Treasure" and other classic cultural themes of the variety show has also emerged. The strong vitality of Chinese culture, through the packaging of long and short videos and other new forms, is more and more widely accepted at the moment.

At the same time, with the new generation of young people's consumption ability, not only the traditional national brands such as Li Ning China and Feiyue Hui Li are popular again, but more and more new national brands have also upgraded and tapped into the traditional cultural elements.

"For example, the co-branding of the Forbidden City, which has become a classic IP, and then the designer incubation platform ICY Jijie Huichao movement incorporates Hanwa, Ruyi, and ancient calligraphy and paintings into fashion design, and typical Chinese imagery like pandas are also highlighted in domestic craft brewing brands." Huaying Capital said.

At the same time, Huaying Capital believes that in addition to tapping into traditional culture, there are also a lot of branding opportunities in niche tracks that focus on the aesthetics and consumption habits of the new generation. Therefore, Huaying Capital has laid out a series of new national brands that meet the needs of young people in recent years, such as Maia Active, a designer sports brand for Asian women, HBA, a designer incubation platform, ITO, a national hip brand, and ITO, a brand that focuses on the travel case, and HBA, a brand with a strong focus on Asian women's fashion. Hwa Ying Capital has laid out a series of new national brands that meet the needs of young people in recent years, such as Maia Active, a designer sports brand for Asian women, HBA, a designer incubation platform, ITO, a travel luggage brand, and Self-Heating Wok, which is based on self-heating and hip packaging. According to relevant information, Huaying Capital has invested in more than 10 consumer brands with a cumulative investment of nearly 300 million, half of which have entered subsequent rounds of financing. In the past not long ago in the double 11, in addition to Li Ziqi, there are a number of brands in the double 11 sub-categories topped the sales list.

The re-excavation of traditional culture and the iteration of current youth elements has undoubtedly become a brand "out of the circle" of the sharp weapon. In such times, the "fireworks" of capital is worth remembering. (Text/Chiba Jiayin Source/Investing.com)