"Esteemed investors, it is not that I disrespect you all, nor am I being obstinate by insisting on continuing this subsidy war. The truth is, our rivals are not giving us a chance to survive. They have started subsidizing the moment we stopped!"
"Gentlemen, you know what this means. It means a vast number of our users are being poached. It means the empire we painstakingly built with tens of billions of RMB is being handed over to others!"
"Gentlemen, we cannot retreat from this battle. I implore you to continue injecting capital, or to open the next round of financing. Otherwise, if the company's performance collapses, forget listing on the US stock market; even listing on the A-share market will be a significant problem!" Chen Hu declared in a booming voice, standing amidst a circle of investors.
This was an investor meeting for Dida Food Delivery. All investors or their representatives were required to attend.
As Dida Food Delivery had already completed six rounds of financing, a considerable number of investment institutions and representatives were present. There were 12 in-person representatives, not to mention five investors who were unable to attend due to various reasons but were participating remotely via conference call in this crucial meeting.
"Mr. Chen Hu, please calm down. Our interests are aligned: to make Dida Food Delivery bigger and stronger, to list it on the US stock market, and for all of us to profit immensely!" representative from Hongshan Capital stated gravely. "However, you must also consider our practical situation. From my first angel investment round until now, over two years and three months, your Dida Food Delivery has consumed over 52 billion RMB. This is all investor money."
"After two years and three months, we haven't seen a single echo of that investment."
"And yet, you are asking us to invest more. This is genuinely difficult. The economic situation this year is not favorable, and capital is contracting everywhere. Can't you find other means to weather this storm instead of forcing us to pour in more money?"
"Other means?" Chen Hu scoffed. "Gentlemen, it's not that I don't want to use other means, but I truly cannot find any at this moment. Very well, if any of you gentlemen have brilliant ideas, I am all ears. As long as it helps us counter our opponents, I'll even give up my chairman position!"
"There are methods!" an investor quickly chimed in. "Improve the quality of food delivery, increase delivery efficiency, enhance marketing strategies, increase spending on acquiring traffic, and develop the existing market. These are all effective ways to boost data without requiring excessive spending!"
"Nonsense!" Chen Hu retorted unceremoniously. "Firstly, food quality is not within our purview; it's the merchants' responsibility. We can penalize delivery riders, but they can simply leave. You constantly urge me to cut costs, especially for merchants and riders. The direct consequence is that merchants and riders can leave at any moment. Because we pay less, they have the freedom to go; they aren't afraid of your coercive tactics!"
"As for increasing marketing and continuing to acquire traffic, we've been employing these strategies for over two years. Anyone who was meant to see our advertisements has seen them hundreds of times. Further marketing efforts will be futile."
"Regarding developing the existing market, that is indeed a good method. But the best way to develop the existing market is through subsidies, through substantial, high-value subsidies to attract those who don't usually order food delivery to do so. Attracting them with prices far cheaper than cooking themselves."
"Now that the subsidies are gone, the means to develop the existing market have naturally vanished!" Chen Hu stated.
"Hmph, you can say whatever you want with your words, but we can't argue with you!" the investor huffed.
"Fine, then let's not just talk; let's look at actual examples. We haven't used all the methods you mentioned, but one food delivery platform has been using them from the start: 'E Bufan'!"
"'E Bufan' has the best food quality, and their riders deliver food to customers. They've also spent a fortune on co-marketing with vacuum high-speed rail, creating such a buzz that their name was all over the country in a single month."
"And what's the result now? The result is that they have been crushed under our feet. Their daily order volume is less than a million. Although they briefly reached five million orders through marketing, they have since fallen back to just over a million. This fully proves that the aforementioned methods are ineffective. The most effective is subsidies, which is why 'E Bufan' has now started subsidizing!"
Chen Hu's words left the investors speechless, forcing them to inquire from other angles.
"We want to know the company's actual situation. How many active users does the company currently have? If it's just a partial reduction in active users, there's no need for such a life-or-death battle with real money!" a representative from an investment company stated.
"Alright, I will report the data to everyone now. During the peak period this year, last month, the company's highest daily order volume reached 10.86 million orders. After we stopped subsidies, and before 'E Bufan' began its subsidies, our daily order volume dropped to 8.21 million orders."
"That's still acceptable. A drop of only 20% is much better than we anticipated!" one investor murmured. Then, Chen Hu amplified his voice, "However, after 'E Bufan' started subsidizing, in just four days, our daily order volume has fallen below 5 million orders. The latest data from yesterday was 4.92 million orders."
"Gentlemen, I might as well make a bold prediction here: if we do not resume subsidies, our daily order volume will drop below 3 million within seven days. Within a month, we might even return to the 1 million order mark. Is this the result you all want to see?"
Chen Hu questioned sharply, and everyone gasped. Losing over three million users in four days was simply outrageous.
"Your user stickiness is too poor. Losing three million users in three days, even three million pigs wouldn't run away so completely in three days!" one investor complained.
"Sir, it's not poor user stickiness, it's that users have no stickiness at all."
"Consumers only see the word 'cheap.' They go wherever it's cheap, wherever there are subsidies. Otherwise, why would platforms that started later than us surpass countless predecessors and become market leaders? Isn't it because we were subsidizing?"
"To put it bluntly, users are like prostitutes. You lure them with money, and they open themselves to you. Now that you're out of money, and others have it, these prostitutes naturally flock to others!"
"So, don't be surprised that 'E Bufan' attracted users so quickly. As long as we have money, those prostitutes will return, ready to be served by you!" Chen Hu's words, though vulgar, seemed to hold a certain logic.
"But we can't always rely on money. This back-and-forth with subsidies, when will it end!" a representative asked resignedly.
"When everyone runs out of money, or when there's only one king left in the entire market!" Chen Hu replied. "Gentlemen, we were actually nearing our end, but this 'E Bufan' just came out of nowhere. What could I do? We can only continue to fight!"
"How much money do you need to defeat 'E Bufan'!" Finally, a representative voiced the question Chen Hu most wanted to hear, signifying that the investors' representatives were beginning to waver.
"I have insider information that 'E Bufan' has prepared 10 billion RMB. To defeat them, we must surpass them. At least 15 billion RMB!" Chen Hu stated.
"10 billion? Are you joking? Where did 'E Bufan' get so much money? They haven't gone through six rounds of financing like you!" a representative exclaimed.
"Yes, they haven't had six rounds of financing. Their boss behind them is also singular, and that person's name is Huang He, the world's richest man. The world's richest man who spends tens of billions of dollars just to build a toy he likes. Is 10 billion a lot?"
At this, the entire room fell silent.
"15 billion is too much. It's impossible for you to get this much money. We can only try to find another 2 billion for you!" Hongshan Capital's representative said.
"Alright then!" Chen Hu nodded. "Then you can just watch all the users flock to 'E Bufan', watch our platform's user base dwindle, our market valuation plummet, our annual reports wail in sorrow, and both the US and A-share markets reject our listing."
"And once the company cannot list, I can resign in shame, pack my bags, and leave. Then, gentlemen, the 50 billion RMB you have invested will vanish into thin air. After all, I, Chen Hu, have not embezzled a single cent of it. This matter has nothing to do with me. You all can do as you please; I'm washing my hands of it, I'm out!"
Chen Hu's gesture of throwing his hands up in resignation infuriated everyone, yet they were powerless.
Having already poured in 50 billion, if they truly couldn't list and cash out, they would be doomed.
"5 billion, we'll try to get another 5 billion for you!" Hongshan Capital's representative countered.
"5 billion is too little, not enough!"
"It's enough. As you said yourself, 'E Bufan' only prepared 10 billion. In these four days, they've used at least 3 billion. In a week, that's 5 billion. In half a month, that 10 billion will be depleted."
"And when their subsidies end and their funds are exhausted, won't it be feasible for you to step in with these 5 billion? Since users are like prostitutes, as long as you have money, the prostitutes are yours. Why must you confront them head-on?" the Hongshan representative said coldly.
"At least 10 billion," Chen Hu insisted.
"Fine, if you want me to provide 10 billion, then on the condition that you, Chen Hu, get out, and I replace you with a compliant chairman!"
"Then 5 billion!" Chen Hu choked, finally agreeing with a nod.