42-year-old He Xiaopeng started his second business three years ago.
“The road ahead remains the same, let’s update the starting point.” On the evening of August 27, Xpeng Motors officially landed on the New York Stock Exchange. The stock code is the company's abbreviation "XPEV", and the issue price is US$15/ADS.
The total amount raised in this IPO was approximately US$1.5 billion, exceeding the highest value expected in the prospectus of US$1.271 billion. It exceeded the US$1.1 billion raised by Li Auto during its IPO last month and the US$1 billion sold by NIO, and far exceeded Tesla's US$226 million that year.
The market value corresponding to the issue price is US$10.82 billion, exceeding Li Auto’s US$9.724 billion and NIO’s US$6.4 billion, far exceeding Tesla’s US$1.7 billion that year. Xpeng Motors' IPO is the world's largest pure electric vehicle company IPO in terms of issuance scale and post-financing market value.
Perhaps because of his dual identity of engineer and product manager, He Xiaopeng is obsessed with numbers.
The day of listing happened to be the third anniversary of his joining Xpeng Motors (August 27, 2017). Looking further back, He Xiaopeng co-founded UC Browser in 2004. On the tenth anniversary of the company, it was sold to Alibaba for nearly US$4 billion.
Looking back at He Xiaopeng’s two entrepreneurial ventures, he met the right people at the right time and made the right decision. As Liu Qing, the author of "History of Entrepreneurship" said: "Although the road of life is long, there are often only a few critical steps, especially when people are young."?
Xiaopeng on August 27 The scene of the car bell-ringing ceremony
Working as a browser at the age of 27
Achieving financial freedom in 10 years
He Xiaopeng was born in 1977, and his hometown is Huangshi, Hubei.
After graduating from the computer science major of South China University of Technology in 1999, his tutor took several students to corporate interviews. The car drove to AsiaInfo first, and four people got off. The instructor said: "You think about it clearly." As a result, two of them got back in the car. The other person failed the interview. He Xiaopeng was lucky enough to enter AsiaInfo.
When he later recalled this story, he said: "Life is the moment you jump off the bus."
The second year after He Xiaopeng joined AsiaInfo, the company was listed on NASDAQ . During this work experience, he did everything from development to pre-sales and after-sales. But he felt that his salary would never be higher than that of his superior, so he wanted to change jobs. He also submitted his resume to HP, but received no reply.
27-year-old He Xiaopeng decided to give it a try.
2004 is the tenth year since the Internet entered China. Back then, he took Liang Jie, an alumnus of South China University of Technology, to start a business with him. His idea at the time was very simple - "out of the jealousy of the 'poor and lower-middle peasants'," he recalled.
He Xiaopeng and Liang Jie founded UC Later, he made two products, UCMail and UCWeb. The latter is the UC browser we are familiar with. Although the former has disappeared, He Xiaopeng met a series of "noble people"
The founder of NetEase. Ding Lei, after trying UCMail, felt pretty good and invited the team out for a drink. In this way, Ding Lei met He Xiaopeng and later borrowed He Xiaopeng's office.
He Xiaopeng in his youth (Source: Internet)
It was in the office that Ding Lei borrowed from him that He Xiaopeng met Li Xueling, the founder of YY Voice who was still the editor-in-chief of NetEase. Under Li Xueling's introduction, he met Yu Yongfu.
At that time, Yu Yongfu visited UC as the vice president of Legend Investment (the predecessor of Legend Capital). When he saw the business cards handed over by He Xiaopeng and Liang Jie, they both had the title of "Deputy General Manager". He was confused and thought After a while, he asked: "Who is the general manager? "
"They all said that our general manager didn't come. We should discuss it with the general manager when we go back. Then after the two deputy general managers finished talking to others, they went out to find a place and discussed it with us. What do you think of this matter? Liu Qin, founding partner of Morningside Capital, said in an exclusive interview with Entrepreneurship State.
In Liu Qin’s view, this is the great wisdom of founders. When doing things without experience, they know how to do it. Learn how to control risks. But what makes him feel ambitious is that He Xiaopeng is willing to invite someone with more ability than himself to be the CEO of the company, and this person is Yu Yongfu.
On November 20, 2006, He Xiaopeng and Liang Jie came to Beijing and had face-to-face communication with the Lenovo Investment Decision-making Committee, including Yu Yongfu. At that time, UC Company had no money in its account, and this financing was a matter of life and death. But unfortunately, what He Xiaopeng was waiting for was Yu Yongfu's words: "The difference between one vote and another will not pass."
The three of them suddenly fell into silence. After a while, the first thing He Xiaopeng said was: "Yongfu, are you willing to join us?" Yu Yongfu replied without thinking: "Okay, we Let’s do it together!” That night, Yu Yongfu called Lei Jun, hoping that Lei Jun could invest in his own name.
Later Lei Jun said: If you go to UC, I will vote.
He Xiaopeng during the UC period (Source: Internet)
In this way, Yu Yongfu resigned from his position as vice president of Lenovo Investment and joined UC, a company that did not have a dime in its account at the time. . In 2006, Lei Jun invested 4 million yuan in UC as an angel investor. The following year, Morningside Capital and Lianchuang Ceyuan invested another US$10 million.
In June 2014, UC Youshi merged into Alibaba for nearly US$4 billion, setting a record for the highest merger and acquisition integration in China’s Internet at that time. He Xiaopeng has successively served as President of Alibaba Mobile Business Group, Chairman of Alibaba Games, and President of Tudou.
37-year-old He Xiaopeng became rich overnight.
Just when everyone thought that such an entrepreneur who had achieved financial freedom would retire and enjoy a retirement life of luxury houses, luxury cars, and yachts, in his forties, he made something that even Lei Jun The decision I dare not make - build a car.
Breaked into car-making purgatory at the age of 40
For the first time to start a business, He Xiaopeng experienced the transition period from PC Internet to mobile Internet.
From the 3G era in 2009 to the 4G era in 2014, hundreds of millions of smartphone users were activated in just five years. In 2012, the number of active users of UC Browser on the Android platform exceeded the 100 million mark, becoming the world's first third-party browser on the Android platform with over 100 million users.
In his second venture, he stood at the forefront of the intelligent transformation of automobiles.
In June 2014, Tesla CEO Elon Musk announced that the company would adopt an "open source model" and open to the outside world more than 300 patents involving super charging piles, batteries and other technologies. In December of the same year, Musk took his private jet to Beijing to deliver the first batch of Teslas to Chinese users.
Elon Musk, CEO of Tesla Motors (picture from Yahoo)
He Xiaopeng once recalled: "I had a very strong feeling when I drove Tesla that the world To change, there is a window of time and opportunity for change in the automobile industry.”
That year, Musk happened to visit Alibaba, and He Xiaopeng took the opportunity to ask him how to use the open source model. Musk said: "You can take it and use it, but how you use it has nothing to do with us."
One day in 2014, He Xiaopeng called Li Hongwei, the managing partner of GGV Capital, hoping that she He Xiaopeng came over to take a look at his new project, "Hey, I made a car and hatched a project. I hope you can come and take a look." He Xiaopeng said on the other end of the phone.
This is a smart car project that He Xiaopeng, Xia Heng, and He Tao worked on together, which is the predecessor of Xpeng Motors. Xia Heng and He Tao both graduated from Tsinghua University and worked for GAC, and were mainly responsible for project implementation. He Xiaopeng, who was working at Alibaba at the time, was an angel investor and did not devote himself to building cars full-time.
“Smart cars are a brand new industry with huge unknown challenges. It requires first-class entrepreneurs to increase the probability of success even a little bit. If Xiaopeng doesn’t go all in, we won’t be able to win even if the valuation is cheap. Invest." Liu Qin recalled to Chuangyangbang in an interview.
He Tao, He Xiaopeng, Xia Heng (from left to right)
Before deciding to start a business and build a car, two people advised him.
The person who advised him to think twice was Lei Jun. Lei Jun told him that unlike Internet entrepreneurship, the smart car industry chain is long and complex. It requires mental preparation to lay the foundation for six years. At the same time, it requires sufficient funds to attract the best talents in the smart car market, so that it can be possible.
The person who persuaded him to build a car was Fu Jixun. For several months, Fu Jixun kept asking He Xiaopeng: "Are you ready to work on electric cars full-time? If you are ready, I will invest."
"
One day after the Spring Festival in 2017, Fu Jixun called He Xiaopeng and said: "You really should do this project. "He Xiaopeng on the other end of the phone seemed to be moved, and his second child had just been born at that time.
He Xiaopeng himself once recalled: "I suddenly felt a sense of shock, that is, my child will ask me in the future, What does dad do? I hope I can tell him some stories that will make him think this dad is pretty cool in the future. ”
In August 2017, he officially proposed to leave Alibaba and work full-time at Xpeng Motors. At that time, many people, including Alibaba CEO Zhang Yong, asked him the same question— - "Have you thought it through? ”
Xpeng P7 (Source: Xpeng Motors)
When recalling He Xiaopeng’s decision to leave Alibaba and start a business to build cars, Morningside Capital Liu Qin told Chuangyebang in an interview: “I was inspired by his courage and simplicity. ”
“When we were talking about this matter, I could feel that he was not doing it for money, because he had already received rewards from UC, but he wanted to create an opportunity that he would have no regrets in his life and create a huge A creative, influential career, this motive seems particularly simple and precious, and he just wants to accomplish something big. ”
Yang Fei, a partner at IDG Capital, also expressed a similar view: “When Xiaopeng founded UC, it had already verified its trading capabilities from 0 to 1 and from 1 to N.” More importantly, even after joining a large platform like Alibaba, Xiaopeng can still have the enthusiasm to start a business again and the resilience to endure hardships, which is not easy. "
When he recalled it later, He Xiaopeng also joked: "Fu Jixun is a bad guy, he dragged me into the water. ”
Facing three big mountains
Is it time for Xpeng to spread its wings?
After Xpeng Motors’ IPO, He Xiaopeng held 27.8% of the company’s shares. Based on the market value corresponding to the issue price of US$10.8 billion, He Xiaopeng's shareholding corresponds to a net worth of US$3 billion, equivalent to approximately RMB 20.6 billion.
The listing is another new starting point for Xiaopeng.
p>In the "Entrepreneurship Insider" interview program of GGV Capital, He Xiaopeng summarized his thoughts on the automobile industry: In the automobile industry, we can see the "three highs": high amount of money spent, large number of personnel, and technology Intensive.
First of all, there is a mountain of funding.
“Building a car requires a lot of money, and it is impossible without a base of 2 to 3 billion US dollars. "In the interview, Fu Jixun told Chuangye.com that if a new car manufacturer wants to reach a stable stage and support the company's subsequent development, it is completely impossible without equity financing of this magnitude.
According to Qichacha data, Xpeng Motors has completed 10 rounds of financing since its establishment, and has received a total of more than 18 billion yuan. As of June 30, 2020, Xpeng Motors held 1.061 billion yuan in cash and cash equivalents; Then in August, Xpeng Motors completed its own C+ round of financing, with a financing scale of US$900 million. In other words, Xpeng Motors will hold more than 7 billion yuan in cash and cash equivalents before the IPO. RMB, not to mention the IPO fundraising amount of more than 1 billion US dollars.
But Xpeng Motors has also experienced difficult times.
In September 2018, Weilai. It was successfully listed in the United States. However, active incidents such as battery recalls and spontaneous combustion in 2019 caused its stock price to fall below the issue price, and its impact on the industry cannot be underestimated.
Fu Jixun also recalled in the interview. , “At that time, the overall automobile market also entered a relatively sluggish state. Everyone was questioning whether the new car-making forces could work. Xpeng Motors was definitely affected. "But the more critical the moment, the more it reflects the founder's financing ability.
Just like Li Bin founded NIO and Li Xiang founded Li Auto, He Xiaopeng also invested in Xpeng Motors with his own money. So the experience After so many rounds of financing, He Xiaopeng still holds 31.6% of the shares. At the time of NIO's IPO, Li Bin held 17.2% of the shares, and at the time of Ideal's IPO, Li Xiang held 25.1% of the shares.
Xiaopeng Motors. Shareholding ratio of shareholders before the IPO (Chart: Chuangye.com)
In addition to the founder’s thick wallet, the endorsement of investors is also extremely important.
When Weilai Automobile IPO, Tencent is. Its second largest shareholder. When Li Auto IPO, Meituan Wang Xing was its second largest shareholder. This time Xpeng Motors IPO, Alibaba is its second largest shareholder.
China's three Internet giants, ATM, are among the three listed companies that are new forces in car manufacturing.
In the list of shareholders of Xpeng Motors, there are not only Internet giants such as Alibaba and Xiaomi, but also IDG Capital, Morningside Capital, GGV Capital, Sequoia China, Lightspeed China, etc. Blessed by ten star investment institutions. Among them, IDG Capital is the largest financial investor, with a shareholding of 6.2%, second only to Alibaba.
Xpeng Motors’ nearly 5 rounds of financing before its IPO (source: RuiShou Analysis)
Secondly, there is a mountain of talent.
In Fu Jixun’s view, He Xiaopeng has the aura of a serial entrepreneur. This halo can not only help him attract investors, fans, and talents. "There are many talents around He Xiaopeng. These people work for companies such as Tesla, Qualcomm and Xiaomi. These people have joined He Xiaopeng's team, and Gu Hongdi is just one of them."
Gu Hong Di was the chairman of JP Morgan Asia Pacific investment bank. In 2018, he joined Xpeng Motors as vice chairman and president. There is a widely circulated joke in the industry: In the past at JPMorgan Chase, Gu Hongdi always flew first class when flying, but now he only flies economy class. The hotel accommodation has also been changed from a five-star hotel to a budget hotel.
In the list of senior executives of Xpeng Motors, there are talents with backgrounds in both Internet companies and traditional car companies. For example, the two co-founders of Xpeng Motors, Xia Heng and He Tao, both worked for GAC New Energy; Xpeng Motors CHO Liao Qinghong once worked for 360 and Huawei.
But it is not easy to integrate talents from different cultural backgrounds.
"In the early stage, there will be collisions in terms of cultural background and concepts. He Xiaopeng will occasionally complain to me, but he also mentioned that you have to let some collisions happen, because only collisions can We can understand each other and figure out a reasonable management mechanism and method," Fu Jixun told Chuangyangbang in an interview.
In addition, the company's vision is also the key to attracting talents.
On the first page of the prospectus, Xpeng Motors wrote the company’s mission: “Use technology and data to drive the transformation of smart electric vehicles and shape the future mobility experience.”
Such a commitment is also reflected in the prospectus. As of June 30, 2020, Xpeng Motors had 3,676 employees, of which 42.7% were R&D personnel, totaling 1,569 people. Compared with Li Auto's prospectus, R&D personnel account for 38.2%, totaling 1,005 people.
In addition, among the composition of Xpeng Motors’ R&D personnel, 66%, 17% and 17% of its employees focus on automotive design and engineering, autonomous driving and intelligent operating systems respectively. This means that the number of autonomous driving R&D personnel of Xpeng Motors is close to 270, which is a considerable number among all domestic car companies.
“If the founder didn’t fully understand his own sense of innovation, it would be difficult for him to spend so much money to find talents in the market.” Liu Qin concluded.
Han Yan, founding partner of Lightspeed China, also said, "He Xiaopeng is a sincere and persistent product person. He will think about how the new energy vehicle industry will develop and what else can be done besides building cars. Consider the long-term future of industry planning."
Xpeng Motors employee ratio (Source: Xpeng Motors prospectus)
Finally, there is the technological mountain.
The financial report shows that Xpeng Motors’ R&D expenses in 2018 were 1.05 billion yuan, 2019 R&D expenses were 2.07 billion yuan, and R&D expenses in the first half of 2020 were 630 million yuan. Referring to Li Auto, which just went public at the end of July, according to the prospectus, Li Auto’s R&D expenses in 2018 and 2019 totaled 1.962 billion yuan, which is far lower than Xpeng Motors.
But after its launch, Xiaopeng still needs to clearly see the players ahead on the track. In terms of R&D investment, Tesla’s figure was approximately 9.3 billion in 2019, while BYD’s R&D investment reached 8.42 billion.
“First of all, we must not lose to Tesla in terms of products, and we must come up with truly world-class competitive products. Secondly, we must invest in long-term technology research and development.”
Morningside Capital Liu Qin believes that as long as there are no shortcomings in the entire product and technology, the biggest advantage of new car manufacturers including Xpeng Motors is localization. “How to better adapt to Chinese driving habits and Chinese driving environment, these are the advantages of domestic car companies.
"
Fu Jixun also has a similar view, "In the next five to ten years, what I see is a smart car market. On the one hand, it is the intelligence of the power system, including autonomous driving, assisted driving, automatic parking and other functions. On the other hand, it is the intelligence of the interactive system, the user interaction experience between the driver and the passenger, such as voice interaction. "
But he also said what Xpeng Motors needs to learn from its predecessors. "I also hope that Xpeng Motors can do better and stronger in terms of brand positioning and user mentality. ”
Xpeng G3’s 10,000th unit rolled off the assembly line ceremony (Source: Xpeng Motors)
In the Xpeng Motors prospectus, we also recognized the many challenges that the company may face in the future. . For example, there are uncertainties about research and development, autonomous driving, industrial competitiveness, etc. However, Xpeng Motors has used the word in-house (independent research and development) 28 times, which is enough to show its determination in self-research. and confidence.
As Han Yan, founding partner of Lightspeed China, said: “Manufacturing is an unavoidable point in car building. Intelligent car manufacturing must truly focus on Internet thinking and technological upgrading ideas on products, and technological independence and production independence must be in their own hands. ”
Written at the end
“Actually, looking back today, I feel that I still underestimated the value of the entire smart car. My biggest regret is that I invested too little. I should have invested more.” some. This also shows that those entrepreneurs have more foresight to see opportunities in the industry than we do. Liu Qin told Chuangye.com in an interview.
Not long ago, it was rare for NIO founder Li Bin, Li Auto founder Li Xiang, and Xpeng Motors chairman He Xiaopeng to be in the same frame. Star entrepreneurs who have already achieved financial freedom now have their own "new car-making force" listed companies.
As of the close of the U.S. stock market on August 26, Li Auto's share price rose by 28.25%. It closed at US$23.38 per share, with a market value of US$19.7 billion. NIO's stock price rose by 14.57%, and closed at US$20.44 per share, with the market value of both companies reaching a record high since their listing.
But facing Tesla, which has a market value of US$400 billion, Weilai, Xpeng and Ideal still have countless tough battles to fight.
A few days ago, the founding managing partner of Matrix Partners China. Zhang Ying wrote in a comment on WeChat: “Eventually electric vehicles will subvert fuel vehicles and become the next trillion-level blue ocean market. China’s new car-making power will blind the eyes of those who don’t believe it. ”
This article comes from the author of Autohome Chejiahao and does not represent the views and positions of Autohome.