compared with previous cases of conflicts between investors and entrepreneurs, the NVC lighting incident has risen to a higher "war level": it has evolved from a pure dispute over the interests of major shareholders to a public event in which all employees participate. Onlookers such as Liu Qiangdong and Chen Nian's discussion ignited the once "feud" between founders and investors.
However, all kinds of fierce confrontations around the NVC incident are essentially non-cooperative games between the board of directors and the management around control rights and decision-making rights, which are issues of entrustment and agency in corporate governance.
Venture capitalists in the industry once said: "Traditionally, investors should not become the largest shareholder, so too much intervention will affect the development of enterprises. Investors should be more financial investments. In corporate decision-making, entrepreneurs should be allowed to develop themselves. Investors are just suggestions and sparring. "
According to the insiders, in order to introduce suitable external investors under the condition of fully evaluating the present situation and development prospects of the enterprise, whether the values of both parties and the future development direction are the same is the prerequisite for deciding whether to invest or not. If investors and entrepreneurs get into trouble, or even resort to the law, the losers are both sides, and there is no real winner.
China's market is constantly changing, and there will always be deviations in the development process of enterprises. At this time, corresponding changes should be made, which requires the two sides to constantly communicate and make adjustments during the investment process. Only when the interests and strategic vision of both sides are consistent can the enterprise be made bigger and better.
We will present several cases completely below, hoping to help venture capitalists and enterprises.
zunku. com "missed the eye"
When Hou Yujiang, the former C E O of zunku. com, a luxury website, raised a round of financing in May 211, * * * four institutions-a well-known foreign investment institution, a Hong Kong VC, an American VC and the Cape of Good Hope e-commerce fund-threw an olive branch to him.
Although the Cape of Good Hope Fund doesn't have much experience in Internet companies, Hou Yujiang, who is in urgent need of fund expansion, chose this fund without much consideration because of its higher valuation and faster promised payment time. "After all kinds of twists and turns, it seems that it was a mistake to choose this company." Hou Yujiang said.
in February, 212, Hou Yujiang was seized by the board of directors because of the disagreement with the capitalist in strategic development, and finally left sadly.
Zhang Lan, chairman of South Beauty Restaurant Group (hereinafter referred to as South Beauty), said in an interview with the media on August 26th, 211 that the introduction of investor Ding Hui was "the biggest mistake of South Beauty, which was meaningless" and "private entrepreneurs paid tuition fees". She also said that CDH brought nothing to South Beauty, but diluted "such a big share" with very little money. For a time, the contradiction between venture capitalists and invested enterprises was once again publicly exposed to the public.
according to public information, in 28, South Beauty chose CDH Venture Capital in the competition of many P E's, and the latter injected about 2 million RMB, accounting for 1.526% of the former.
In p>211, South Beauty has been rushing for A shares, but its listing failed. Due to the gambling agreement signed with CDH, after the listing of South Beauty was frustrated, CDH asked Zhang Lan to buy back shares at a high price. For Zhang Lan, following the advice of CDH Venture Capital, she sold part of her shares to senior executives at a low price, but still could not be listed in China. She felt that she had lost herself. Under such circumstances, both sides have dissatisfaction and contradictions have surfaced.
people who do business have different ideas from those who do finance. If there are different ideas and conflicts of interest, it is easy for both sides to talk about collapse.
hougu coffee dispute
in June p>212, hougu coffee, the largest coffee producer in China, broke with PE investors. Hougu Coffee said that PE institutions were tempted to swallow the shares and wanted to seize the control of the company. The PE side said that Xiong Xiangjin, chairman of Hougu, may abscond with the money, and there is no hope of listing in 212.
In early p>211, Beijing No.1 Fund Company reached an investment agreement with Hougu Coffee. After the introduction of this equity investment company, Hongtian Group, the parent company of Hougu Coffee, is still the major shareholder, holding 59.74%. However, the contract signed by the two parties earlier stated that the loan must be approved by two (or more) directors of the new investor, and the fund director happens to be two. This directly led to the completion of the new loan credit approval of the bank, but the fund refused to sign it, which made the enterprise fall into a situation of "only paying off the loan", and the capital chain of Hougu Coffee was in a hurry.
It is reported that the reason why the funder has been slow to sign is that the investor has not seen that the funds are really used for the normal operation and development of the company. Hougu accused the investors of gaining control of Hougu Coffee.
hougu coffee, which was originally intended to be the "first coffee stock in China", not only failed to realize the established development strategy after the introduction of investors, but a new round of bank loans was delayed, and hougu coffee with an asset-liability ratio of 7% almost went bankrupt.
it can be seen that only by clarifying the problems left over from the early extensive management can private enterprises not be passive in the process of introducing capital. For venture capitalists, they are not only simple financial investors, but also strategic investors. The impetuous mentality of making quick money and big money has to be changed, otherwise, once the enterprise itself is unsustainable, PE will also be doomed to lose its investment.
Appropriate Materia Medica Event
In July p>212, the local cosmetics company Appropriate Materia Medica, which is rushing to IPO, reported that the capital relationship with investors had deteriorated today. According to the report, Feng Shuai, the chairman of Appropriate Materia Medica, once cursed Xin Xu, the president of Today Capital, as a liar, who suffered from the aura of venture capitalists such as Gongfu and Netease.
It is reported that in the first year of successfully introducing today's capital venture capital, Feng Shuai, the founder of Yiyibucao, signed a gambling agreement, which raised the growth expectation of Yiyibucao from 5% to 7% to 8%, and began to appear on TV without advertising. In this year, the growth rate of appropriate herbal medicine sales finally reached 15%; In the following three years, Appropriate Herbal Medicine maintained an average annual growth rate of more than 15%.
Today, the capital side has tasted the sweetness and hopes to do even greater. According to the report, from 28 to now, today's capital "should have contacted all the national cosmetics enterprises with a performance of more than 5 million". Appropriate materia medica has a great opinion on this, denouncing that it should not invest in competitive enterprises in the same industry, deliberately causing the situation that the left hand hits the right hand.
At present, the two sides are still in a stalemate. But at the same time, today, the people in charge of consumer goods in the capital side have been divided into several groups, looking for investment projects everywhere. This is the death order given by Xin Xu, the capital of today, and we must invest in a daily chemical retail enterprise this year.
The founder of Red Kids left
On October 6, 28, Li Yang, the general manager of Red Kids Internet Technology Co., Ltd., returned to work after the National Day holiday. Jin Peng, a representative of KPCB, one of the investors, came to his office to tell him straight away that the board of directors decided to let him leave the company founded by him immediately.
without warning. Li Yang was very surprised. In 27, Red Kids' sales revenue reached 4 million yuan, and in March 28, it crossed the breakeven line and became the most popular e-commerce company in that year. He asked another entrepreneurial partner, Xu Peixin, chairman and CEO of the company, and the answer was: "This is the decision of the board of directors." Next, Li Yang couldn't get in touch with any major shareholder because "some people didn't answer the phone and some people said they had gone abroad".
Li Yang left with his wife, Wang Shuang, who started a business with him. Xu Peixin explained that the board of directors thought that husband and wife could not work in the company at the same time, and they didn't want to be separated, so they both left. But in the eyes of the parties, this is nothing less than a coup.
According to the insiders, the chaotic situation of Red Kids is mainly caused by the excessive intervention of investors. It is reported that Xu Peixin, another founder, chairman and CEO of Red Kids, has retired to the second line, and the executives elected by VCs are responsible for the daily operation of Red Kids.
In July p>212, it was reported that Chuanhong Children would be acquired by Suning.cn. Although both sides of the news denied it, it is hard to hide the dilemma encountered by Red Kids, which once again proves that the game between investors and entrepreneurs ultimately hurts enterprises.