Exclusive | Li Gang of Bluegogo: The battle has just begun, but the despair Didi brought me is over

Leifeng.com: Based on past cases, mergers and acquisitions seem to be the standard answer to the end of the industry, so when the shared bicycle trend first emerged, some people predicted that this war would end soon.

What is more reliable than the standard answer is the Matthew effect: there is no third player in a fully competitive market. This is the first report of the "Shared Bike Series" on Leifeng.com, which tells the understanding of shared bikes from the perspective of Bluegogo, the third player in the industry.

On September 26, 2016, Li Gang was desperate. On that day, Didi announced its investment in ofo. Based on his understanding of the former, this might mean that Bluegogo could surrender early.

During that time, Li Gang ran 10 kilometers every day to relieve stress and lost 70 to 80 kilograms in a week. Later, as more and more capital poured in, Li Gang found that things were not as bad as he had imagined. "Winning first does not count as winning" became his mantra, his mood improved, and his weight gradually rebounded.

Bicycle big picture

On March 21, ofo announced that it would promote variable-speed bikes in Singapore. Li Gang couldn't help laughing. "We started to launch variable-speed bikes in San Francisco three months ago. We used various methods to push the local government to allow bikes to enter the market. But they did nothing and announced that they had entered the market the night before our official announcement."

On March 15 and 20, Li Gang posted two WeChat Moments, both about Bluegogo bikes being moved and damaged, giving way to Mobike bikes. When asked about this, Li Gang smiled and said that it was not so exaggerated as to take legal action. He had communicated with Mobike executives and they said that in many cases, it was the lower-level operations that were at fault, and the upper-level management could not control it.

These two scenes, on the one hand, reflect the conflict between the competing shared bikes. On the other hand, they also reveal the delicate relationship between the three.

Mobike, ofo and Bluegogo all have Uber China’s shadow. On the afternoon of August 1, 2016, Didi officially announced the acquisition of Uber China, unifying the online car-hailing industry. Then came the disintegration of Uber China’s senior management team. Zhang Yanqi, a former Uber China executive, became ofo’s COO, Chen Wei, the former head of Uber China products, joined ofo as chief product officer, and Wang Xiaofeng, the former general manager of Uber Shanghai, became Mobike’s CEO.

In general, ofo is dominated by the Uber China northern faction, Mobike is dominated by the Shanghai faction, and Bluegogo is dominated by the southern faction. In Li Gang's eyes, the three factions are obviously different: the northern faction likes to burn money; the Shanghai faction is thrifty and has a touch of art; and the southern faction is more down-to-earth.

"My brothers and sisters at Uber are all very hardworking and have a strong fighting spirit. They are full of energy every day and shout "Go, work, work!" Li Gang is very happy.

If team genes affect tactical play, then capital genes bring more practical welfare support. For example, Didi, which made Li Gang quite upset, invested in ofo. In April, Didi APP may connect ofo services to the latter, bringing direct entry traffic to the latter. WeChat, which invested in Mobike, directly jumps through WeChat "scan", WeChat wallet third-party service "nine-square grid", and mini-programs.

In comparison, Bluegogo's pace at the capital level seems too slow.

When Li Gang sold the 360 ​​smart button project to 360 and signed the resignation agreement, he talked to Xu Xiaoping about Beast Riding and immediately received a million US dollars in support. Unfortunately, the same thing did not happen to shared bicycles. ZhenFeng invested in ofo before Bluegogo entered the market.

What’s even more interesting is that Li Gang’s wife is an insider of Huaxing Ventures, and Huaxing is the exclusive financial advisor of Mobike. At the mahjong table, seven or eight out of ten people were from Huaxing. In order to ease the awkwardness, Li Gang could only smile and shout: “Come on, everyone, chat freely, except for bicycles.”

With the support of giants and the advantage of time, ofo and Mobike have become the leaders in shared bicycles. Under such circumstances, the Xiaolan team decided to move south and north and attack Beijing.

“Second-tier and third-tier cities can never prove that you are in a core battleground.”

On the one hand, the combat value of second-tier cities is too low. Meituan is a model of victory in surrounding cities from the countryside, but Li Gang believes that Meituan can fight an annihilation war and slowly eat away the opponent's market share, but as an asset-based industry, there is no way to really achieve one who kills the other. After all, the vehicles are there .

On the other hand, trying to enter the market through the first-tier cities and then attacking the Beijing-Shanghai area is the only way for Xiaolan to choose. Because there is a high possibility that when the weather warms up, Xiaolan will not enter Beijing and Shanghai again, "basically there will be no possibility of entering again."

A tough battle

JD CEO Liu Qiangdong held a B round sharing meeting for Beast Riding. Li Gang could not remember the content of the whole one or two hours. There was only one question and answer that touched him deeply. Someone asked him, as a CEO, what criteria do you rely on to make decisions? Liu Qiangdong replied: I only have one criterion. If you have these roads to choose from, you should choose the most difficult one.

This is a bit like chicken soup. But if you review the choices made in the bicycle industry, you will find that many people always choose the easiest way, such as crazy production of bicycles with low prices and poor quality. Li Gang looks down on this choice.

Li Gang came to a conclusion that the first turning point of shared bicycles will appear in July and August, because the damage rate of products with iron frames will become very high at that time. What do users care about most? Is the bike easy to ride? What does the market care about most? Will your bike still be rideable in six months?

For example, the first generation of Mobike reinforced everything that could be reinforced. The initial version weighed 30 kilograms, and after improvements it weighed 25-28 kilograms. So now when there are more choices on the market, would you ride a 30-kilogram bike?

Single-layer PU tires are easy to deform, so choose double-layer ones. Iron frames are easy to rust, so choose aluminum alloy ones. The cost of updating pneumatic tires is too high, so choose solid tires. Otherwise, the cost of recycling a car is 100 yuan, and the cost of scrapping a car is 400 yuan. Even if recycling and other corresponding treatments are not carried out, good and bad cars are mixed together, and users will only choose other ones, which will lead to runs and withdrawal of deposits.

To put it bluntly, the shared bicycle industry is a rental industry, and high quality is a prerequisite, and low price is only an auxiliary option. High quality also means high cost, but this may not be the time to worry about money.

Relatively speaking, the second turning point came somewhat suddenly. Shanghai issued the first shared bicycle industry standard, which included the requirement that bicycles must be equipped with GPS positioning devices and have satellite positioning and Internet operation functions.

Regarding these rather pointed regulations, ofo said it is working with China Telecom and Huawei to jointly develop a new generation of IoT shared bicycles based on NB-loT technology, which will have GPS precise positioning capabilities. However, at present, ofo officially claims that it has connected more than 1 million bicycles, covering nearly 40 cities around the world. Once the policy regulations are implemented, the old non-compliant bicycles will become a heavy burden.

Who is standing behind the bicycle?

Rather than worrying about similar competitors, in Li Gang's mind, the biggest threat comes from giants, such as Didi.

From the initiation of the shared bicycle project to its gradual promotion, the industry events that occurred during this period had the greatest impact on Li Gang. One was Didi's acquisition of Uber, and the other was Didi's investment in ofo.

On the one hand, it was originally expected that the fight between Didi and Uber would continue for a while, giving new entrepreneurial projects some time to grow and breathe. However, who would have thought that the battle would end in an instant. What if Didi, which has an "invincible myth" in the travel field, has some free time and wants to sharpen its teeth and build a shared bicycle of its own?

On September 26, 2016, Didi Chuxing’s official Weibo account announced a strategic investment of tens of millions of dollars in the shared bike platform ofo, and the two parties will launch all-round cooperation in the field of urban travel in the future. Subsequently, Didi participated in three rounds of financing of ofo, and currently has become the largest shareholder of ofo with more than 30% of the shares.

There is no doubt that Didi and WeChat are more than just financial sponsors.

Li Gang has always believed that the shared bicycle market is not determined by money or speed. Focusing on the depth, the opponent spent half a year to deploy 150,000 bicycles in Beijing, Xiaolan said that it is expected to achieve the same in one month. In terms of profit model, Xiaolan also connected to Sesame Credit and promoted the deposit-free model. At the same time, the platform will launch peripheral hardware, offline activities, light social networking and other methods in the future to expand in multiple directions.

Before the interview ended, Li Gang told Leifeng.com that he highly praised Sun Tzu's Art of War, and cited a sentence from it as an example: "Know yourself and know your enemy, and you will be able to make mistakes in many ways." In Bluegogo's domestic and overseas layout, which ones are revealed and which ones are ready to go, will all be revealed sooner or later in this tough battle.