How Do Monsters Pass Through The Death Jungle Of Shared Power Bank?

On the evening of April 1, monster charging was officially listed on NASDAQ with "EM" as its security code. The issuance price of the company is 8.5 USD / ads, and 17.5 million ads shares are issued for the first time.

Founded in 2017, monster charging is the latest one to start in the domestic market pattern of "one beast, three electricity". Now the company is catching up, becoming the first share of the sharing power bank listed. From the perspective of market structure, the industry report released by iResearch shows that monster charging ranks first in the shared charging industry with a market share of 34.4% in 2020, becoming the largest shared charging operator in China.

It is understood that in the IPO of monster charging, Hillard capital, ASPEX Management (HK) Ltd. and Xiaomi technology, as cornerstone investors, intend to subscribe for us $110 million. Goldman Sachs, Citigroup, Huaxing and BOCI are jointly acting as underwriters.

Among cornerstone investors, Hillard has been increasing its weight for six consecutive rounds from angel round, accompanying monster charging all the way to IPO. Xiaomi technology also invests in supporting the growth of monster charging, and supports monster charging with its industrial ecological chain advantages, helping to build a competitive supply chain system.

Prior to the IPO, Hillard and Xiaomi technology had respectively held 11.7% and 7.5% shares in monster charging, ranking second and fifth largest institutional shareholders. In addition, Ali has become the largest institutional shareholder of monster charging with 16.5% shares.

Many rounds of investment support from high altitude and Shunwei

According to public data, monster charging made six rounds of investment before it went public. In April 2017, monster charging obtained tens of millions of Yuan Angel round financing from Xiaomi, Gaoling and Shunwei; in July and November of the same year, the company completed round a and round B financing, with the amount reaching hundreds of millions of yuan.

In December 2018, monster charging received $30 million in B + round financing. One year later, in December 2019, monster charging obtained 500 million yuan c-round financing from Softbank Asia, BOC International, Goldman Sachs, Yunjiu, Hillhead and Gan Jiawei. The company's latest round of financing is the d-round financing completed at the beginning of this year, led by Alibaba and CMC, followed by Carlyle (CGI), Hillhead and Softbank Asia, with a financing amount of more than US $200 million, setting a single financing record in the field of shared charging.

After round D financing, Ali became the largest institutional shareholder of monster charging with a 16.5% stake. Hillard, which has invested for six consecutive rounds, holds 11.7% of the shares of monster charging, ranking the second largest institutional shareholder of the company. It is reported that monster charging is also the only project that has been disclosed to be supported by Hillhead "full cycle".

The earliest contact between Hillhouse and monster charging was in late April 2017. Xiao Yongqiang, executive director of Hillhouse venture capital, met the founding team of monster charging for the first time. In May, Hillhouse invested in monster charging. Xiao Yongqiang commented that his first impression of the founder Mars (CAI Guangyuan) was that he was very smart, had good experience in making products and leading the team, and had a strong learning ability, "belonging to the people who shine in the crowd".

Since then, Hillard has made several rounds of investment in monster charging. Especially in 2018, when the market as a whole was pessimistic about the industry, Hillhead still did a round of internal leading investment, making monster the only company that got money in the industry at that time. In addition to key rounds of investment support, Hillhead also introduced the former coo Forrest Gump (GaN Jiawei) to the company in 2018. As an individual investor, the latter also participates in the financing of monster charging.

For the listing of monster charging, Xiao Yongqiang said: Monster charging is a company with deep vitality. If we use one word to describe it, it is very energetic. It has always been committed to bringing continuous energy to users with high-quality service. At the same time, in the aspect of ESG, the popularity of the shared power bank represented by monster charging has greatly reduced the waste caused by the idle personal power bank. While effectively improving the utilization rate of resources, it also contributes to the carbon emission reduction of the whole society.

"As an investment institution that firmly supports innovation, Hillard has invested for six consecutive rounds starting from angel round, and has continued to increase its size in the IPO stage, and has been accompanying monsters for a long time. IPO is a new journey. We very much expect that under the leadership of Mars, monster charging can always remain innovative, friendly and create value for users for a long time. " Xiao Yongqiang said.

In addition, it is worth noting that Shunwei capital has been investing in monsters for five consecutive rounds, becoming the third largest institutional shareholder of monster charging with 8.8% shareholding. Regarding the listing of monster charging, Cheng Tian, partner of Shunwei capital, said that Shunwei capital is honored to work with the founding team, cooperate with shareholders such as Xiaomi company, participate in the growth of the company from angel round, and provide multi-dimensional support for the development of monster charging.

"With the help of talent network, industry experience, capital and resources, we help the monster charging team to promote business development in the supply chain, products, talents and operations. Listing is just a new starting point, and this IPO can also give monster charging great help in terms of brand and capital. " He said.

In 2020, the revenue increased by 38.9% year-on-year, and it was profitable

According to the industry report released by iResearch consulting, from the perspective of market structure, monster charging ranks first in the shared charging industry with 34.4% market share in 2020, becoming the largest shared charging operator in China. At the same time, by the end of 2020, monster charging has built a shared charging network with more than 664000 points, put in more than 5 million rechargeable power banks, and the total registered users have reached 219 million, an increase of about 70 million compared with the end of 2019.

As a latecomer, how does the monster charging stand out in the competition of "one beast, three electricity"? Zhu Tianyu, managing partner of LanChi venture capital, an early investor of monster charging, told the 21st century economic report that for the operation of shared power bank, the number of POI and the number of available power banks are two important indicators to measure business expansion and coverage.

The monster charging team is very clear that if you want to catch up, you must optimize the unit economic model. The team has always stressed that it is necessary to accurately find those high-frequency, really useful and account worthy points, and each POI should ensure the contribution of real income, as well as the maintenance of customer group relationship and meticulous operation. In contrast, other power bank projects at that time put more resources and energy into expansion and distribution. It seems to be high and high, but in fact it is a bit blind. Some companies have set up a lot of points, but the actual income and fixed costs can not be accounted for.

At present, from the overall performance point of view, monster charging is in a period of rapid growth and has achieved profitability. According to the company's prospectus, its revenue in 2019 and 2020 will be 2.022 billion yuan and 2.809 billion yuan respectively, with a year-on-year increase of 38.9%. In addition, monster charging is profitable while expanding rapidly. In 2019, the net profit of monster charging is RMB 166.6 million and the net interest rate is 8.2%. In 2020, monster charging made a net profit of 75.4 million yuan (US $11.6 million), with a net interest rate of 2.7%.

Under non US GAAP, the adjusted net profit of monster charging in 2019 and 2020 is 206.6 million yuan and 112.6 million yuan (US $17.3 million) respectively. It is worth noting that in the second half of 2020, the revenue of monster charging will reach 1.851 billion yuan, up 38% year-on-year, and the net profit of non GAAP is 205 million yuan, with a year-on-year increase of 56%, realizing the reversal under the influence of the epidemic situation.

In fact, in addition to the competition of "one animal, three electricity", the current shared power bank industry is still facing competition from meituan. Meituan has natural advantages in merchant resources and channel operation. According to meituan's Q3 financial report in 2020, meituan has 6.5 million active merchants and 480 million annual transaction users, a new high. In the consumption scenarios of power bank, 50% come from catering and 30% from leisure and entertainment. The entry of meituan once made the competition pattern of the sharing power bank industry more intense.

In this regard, Zhu Tianyu believes that at present, what has really challenged the charging of monsters is that the epidemic has affected profits, rather than the admission of giants. As for the competition with the giants, it seems that it is actually a "retreat without war". Because, from the perspective of giants, we should also consider priorities. Although there are a lot of businesses that I want to do, strategic thinking has come up with; but resources are not unlimited, even giants must concentrate their resources on higher priority businesses. At this stage, meituan's highest priority business is obviously not shared charging.

As far as monster charging is concerned, a shared charging network has been built in life scenarios such as life consumption, leisure and entertainment, medical services, transportation and so on. What is its next development goal?

Some industry insiders analyzed to the reporter that the new consumption network jointly built by massive users and merchants, with the support of the Internet of things and big data technology, will help monster charging and constantly explore new boundaries of scientific and technological consumption. "Kaihuan", a new liquor brand incubated by monster charging, was launched at the beginning of this year and has been sold online and offline simultaneously. Take Kaihuan as an example, it is not difficult to see the Growth Logic of monster charging. With the help of sharing the network effect and channel advantages of charging business, the channel reuse of other categories is realized, and the connection between shared charging network and consumption network is completed.