GGV GGV capital operator attention performance: drops and fast after the merger

note: hunting cloud original Nemesis in a successful marriage, valentine’s day drops and quickly announced a merger. As the drops a taxi investors, GGV GGV capital operator performance is how to see the influence of the combination is decorated? His point of view or more some reference significance. Below I wrote for him:

drops a taxi and quickly take a taxi after the merger, not only the fierce fighting with taxi had integrated into the market, also produce a owns the absolute leader of the network effect, this area is expected to appear next level billions of dollars. As drops a taxi and south-east Asia’s biggest software Grabtaxi investors take a taxi, I firmly believe in mobile to travel there will be a significant reversal. Drops and fast merger, to the user, is good news for companies and investors. Now I am going to talk about this judgment reason:

A

, localization advantage.

O2O areas are in the form of on-demand services (On demandservice) comprehensive change our food and clothing live line, feed line and the two high frequency field, in particular, I invested in traffic field drops a taxi, Grabtaxi, and maintain a little. Most investments are based On a judgment, on-demand services (On demand service) service is based On local demand set out, this means that the winner is those who can better to meet the needs of localization of the company.

a taxi software is one of the most obvious example, in different areas, a taxi software is cut into the market in a different way. In the United States, Uber Black is high-end car rental service, Uber with high-end service into the market, down from the abundant service line and users. But things are different in China, is from low-end but high frequency drops and fast taxi service into the market, from the bottom up drive to provide more services, at the end of last year, drops are introduced and the fast car, perfect the travel service. In southeast Asia’s largest taxi Grabtaxi application, for example, Grabtaxi by taxi to cut into the market, but also derived according to the requirements of the local market down, Grab, Grab the car and bike and up to fully meet the demand of the user’s travel.

traffic is a very localized market, it needs local drivers and docking services, serving the local users, even facing the local policy and regulation, so all this need a familiar with local market service providers. So for traffic, the localization service providers are most likely to be a winner.

two, network effect advantage.

some business has a strong advantage of network effects, such as alibaba we early investment, its taobao C2C platform is a typical example. Taobao, gathered a large number of business resources, the client has also formed the absolute network effects. This is why taobao are difficult to replace later, baidu, tencent ended b: try to traders are tasted.

follow the industry of the network effect is of great value to the first mover advantage. In the taxi industry, drops is starting, then keep pace with the fast, then the hornet, etc. Although it is very hard, but it is difficult to catch up with them, the more the driver, taking a taxi is quick, give up the possibility of a service to other platforms. So, drops and fast merge, can make the company together and integrate the existing resources, strengthen the advantage of the network effect, provide more efficient service for users, and pull open the distance and other competitors, become a market leader, no doubt.

not all integration brings the effect, in the content as the driven industries, integration does not bring leader in absolute advantage. I attended the youku and tudou to merge as an example, the optimal soil after merger, stopped we envisioned the content of the purchase price, but on the other hand, the merger did not stop the user’s “flow”, the user will still stay to choose other platform based on content.

merge brings a further advantage is that the two companies can stop subsidies for real innovation. I agree with Peter Thiel in “from zero to a” point of view, the excessive competition is not the best for the company development, excessive competition contains large amounts of waste, only reduce the waste, the company have a chance for true innovation.

Three,

grade next billions of company.

in this process we realize that when the formation of a high frequency of travel after entry, can provide users with a full range of travel services, drops and want to build the whole transportation integration, covering from the bus and subway to the taxi and car all the way, from the passenger demand, when you want to go to a place, you can open the App to find the optimal solution. It will tell you from point A to point B, the optimal transportation Suggestions, even in the plan are included in the solution to the optimal or other users to share and mileage.

so we look good together drops will become a user and the driver active traffic data platform for the large data, through accurate data matching and improve the network coverage to provide travel services to users, in the future, drops quickly can not only provide users with more convenient take a taxi, optimization of the car and it’s more important is the entrance to create more value for users, it’s the chance of a $50 billion to $100 billion. Mergers can reduce the unnecessary waste of resources, to put more resources into product innovation, a red envelope and subsidies may be less but products will bring more value for the user. Combined, the two companies aim high together create a great start.

in the end, the biggest challenge is that after the merger of two teams, the focus of work in the next six months. After m&a in youku and tudou, the team combed as merger half a year the most important thing. Team is facing major changes when the challenge is to leave the best talents, because in the unstable environment, the best talent is often the fastest loss. In the drops on the team, I understand chengwei alibaba’s management system and experience, willow blue also has a rich management experience, I believe that both partner management team will lead the team with the original fast calmly to face this challenge.