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We talked with the VC who invested in China's first quadruped robot company
In 2021, the popularity of China's robotics industry can be reflected by the following data.
In the first 10 months of this year, a total of 299 robotics projects in China received financing, with 253 of them focused on Series C and earlier round, and 79 projects with the financing of more than 100 million RMB, according to data on Tianyancha. In a news report from 36Kr, the founder of a robotics company, which was only founded earlier this year, described the popularity of the industry this way: "There are still many investment institutions that want to cooperate with us, but there is no longer a share. With the market this year, we and our competitors should both be able to survive well."
In such a hot year of robotics where "if investors hesitate for a while, they may never get the chance again", Wu Jiang, an investor from VarCapital, successfully invested in Unitree Robotics, China's first quadruped robot company, back in 2018.
In 2018, VarCapital and Anchuang Capital made the first angel investment to Unitree Robotics, and at the end of 2019, before their debut of A1 at CES, Unitree Robotics completed a Pre-A round of financing of tens of millions of RMB, with this round invested by Sequoia China Seed Fund and additional investment from the original investor, Dexun Investment. Since then, Sequoia China Seed Fund has continued to increase its investment in Unitree Robotics in 2020, and it has also been supported by Vertex Ventures and Chuxin Capital. Recently, it was also announced that it has completed a $10 million Series A financing round, led by Shunwei Capital.
So where does Wu Jiang get such business judgment? As an investor, what insights does he have into emerging industries and fields after the pandemic? How does an investor view the relationship with entrepreneurs? And in his eyes, what kind of people hold the future in their hands?
The following is a transcript of the conversation between HoloBase and Wu Jiang, an investor at VarCapital:
About Investment Experience
- What is the main direction of your investment?
We mainly invest in technology-oriented startups in the early stages.
- What are some examples of investments that have excited you so far?
VarCapital invested in Unitree Robotics, the first quadruped robot company in China, whose benchmark company is Boston Dynamics. Unitree Robotics is the only quadruped robot company in the world that can achieve mass production and shipping at a price close to 1/10 of Boston Dynamics' price and achieve 70% of the product's functionality. This is why Unitree's products are very popular in both domestic and international markets.
About Judgment and Trends
- Where do your business insights come from? Speaking as an investor, how do you see trends that the vast majority of people don't see?
On one hand, it comes from a wide range of content intake. I spend about 4 hours a day reading all kinds of relevant information and content, including Internet business, technology, and so on.
The other side of the coin comes from keeping in close contact with entrepreneurs in the industry, who often have all kinds of strange ideas and are often on the front lines of the business, sensing changes in the environment.
Unfortunately, most of the time I don't think I can see the trends that most people don't see, but we can go behind some relatively interesting structural points to deconstruct its logic, and then potentially discover the big trends and opportunities. In addition to delving into some interesting structural points, we also refer to the data and what the driving motivation behind it is, as well as some underlying context of the times and infrastructure improvements, such as the popularity of hardware devices, the diversification of mobile services, changes in user patterns and so on.
- What kind of changes is happening after or during the pandemic in the industries you are most concerned about?
I usually spend most of my time in the enterprise services track, and most of the projects I look at now and areas of interest come from there. After the pandemic, enterprise services were pushed to a new level. In the past, if people only thought of enterprise services as a structural point to improve the effectiveness of the enterprise, after the pandemic, people realized that enterprise services have an irreplaceable role in the field of collaboration and telecommuting. So it's becoming more and more important, and many companies are getting a lot of money, getting recognition from investors, and their services are increasingly being recognized by more and more startups.
- Did your philosophy or thinking about investing change before and after the pandemic?
We have always been a relatively long-term fund, so our investment philosophy has not changed much in the past, either before or after the epidemic. We are committed to investing in founders and companies whose technology system is their core competency, so as long as their technology system is superior, their technology capabilities are always improving and they are always providing better services. We don't think we are particularly concerned about whether they have raised a lot of money or not, but rather whether their technology has real business value in the long run and provides social value.
- What areas of opportunity are you bullish on for the next decade?
Recently, the metaverse is a very hot concept, but I think there are a lot of things that can be covered under this concept. We are more optimistic about the relationship between people, connection, social communication, and emotion, as well as enterprise collaboration and other dimensions under this big concept.
- What qualities do you look for in entrepreneurs? Or do you see any commonalities in the successful entrepreneurs you have worked with?
I value the entrepreneur's ability to learn and iterate on themselves. Many of the successful entrepreneurs I have contacted may not necessarily be the best in their abilities at the moment, but they have a superb ability to learn and iterate on themselves. Entrepreneurs of this kind can maintain continuous learning in unfamiliar areas, and constantly update their knowledge, while building a new body of knowledge in the process, and then see greater opportunities in the future.
- What do you think is the ideal relationship between investors and entrepreneurs?
An investor should be another partner of an entrepreneur in some cases. I generally don't think of myself as an investor, but rather as someone who thinks like an entrepreneur to face problems and solve them.
In my opinion, investment is not only a process of giving money, but also a way to help entrepreneurs continue to iterate and think through their business and projects, to find real problems, and then to solve them.
- The word "dream" is often mentioned by many investors. What do you think about the meaning of having a "dream" for entrepreneurs?
Dreams are not something that is often mentioned by entrepreneurs, but a good entrepreneur should have a deep-seated obsession with something and believe that this obsession can make society better.
We will talk to the entrepreneurs about their real dreams, but we don't necessarily talk to them all the time. We look forward to understanding the entrepreneur's driving force behind the solution itself and the vision of their business. This vision is not only about business but about society. While none of this prevents us from making judgments about the business itself, we prefer founders who have a clear vision.
- Who do you think holds the future of this world?
There is no doubt that it is certainly creative young people.
- Do you have any contact with the new generation of entrepreneurs, such as the post-90s and post-95s? And how do you feel about dealing with them?
I recently contacted many young entrepreneurs. Most of them are so-called "z-generation". From the frequent communication with them, I found that they are very creative and bold enough to think and act. Although they under-assessed some dimensions of risk, for their age, it is clear that considering risk is not the most important issue. The most important question is how to unleash their creativity and put it into a more effective way to form products and solve problems.
- There are young people among HoloBase users, including college students. Do you have any advice for young people on how to invest in their lives?
I don't think I have a clear answer to this question, but I do have a personal suggestion. When you are young enough, spend more time exploring what you love. Don't mind whether what you are passionate about is recognized by the world or not. It's more about whether you love the things and participate in creating or renewing them. Beyond that, be bold enough to try out instead of just watching.