Rita Yang
I can’t believe 2020 is already coming to an end, it has been quite a year. The last time we had you on the show, Jixun, is for the cash flow webinar we had with Brian from XPENG. A lot has happened ever since Brian is now the president of a public company. So, we’re super excited to have you on the show. Again, thank you for joining us, Jixun.
Jixun Foo
Thank you for having me.
Rita Yang
If you were to describe your 2020 in one word, what would that be?
Jixun Foo
You know, when I first saw this question, I was trying to figure out like, what’s the right word to describe? And I think that a good word would be turning point.
I had wanted to describe it as volatile, which obviously it is, even if you look at stock market, pre COVID, to now. It was quite a rollercoaster ride. But I felt that the turning point is a more meaningful description of a lot of things.
It’s the turning point for many of our behaviors, where companies, individuals, consumers, are getting to getting used to a new way of doing things, which is online. So, we do see a rising adoption of eCommerce despite the years of existence of platform sites like Alibaba, Amazon and so on. But the rising eCommerce was accelerated by the COVID impact.
There’s also this whole phenomenon going online where webinars, meetings, even social interactions, toasting, happy hours, and IPOs online. I think that behavior, online is quite a big thing. People are getting used to a new norm. And I think that we all look forward to meeting people, big gatherings, we all look forward to traveling and see different places and meet new people. I don’t think that desire for travel will change. But I think that is a turning point in terms of what people were used to, doing so much online, has become something very acceptable. It’s almost a default. Many things have made 2020 unique. When we look back, it is a pivotal year of change.
Rita Yang
What about the venture capital world? Is there any turning point where you felt like the venture capital world is becoming something different?
Jixun Foo
We are seeing this whole shift and migration towards technology, towards internet, towards the Cloud. The turning point in terms of behavior is driving a lot more adoption of cloud services, online services so that there will be more infrastructure investments into the cloud. And demand for cloud. That in itself is driving a lot of the migration to the cloud. So far GGV Capital has had 7 IPOs for the year, right?
Rita Yang
Yes, the last time we talked it was six, if we add Airbnb, it will be 7.
Jixun Foo
This year alone, we had seven IPOs. And we still have two more that we are expecting next week. One is Wish and the other one is Affirm. We have two more in January that we are expecting. And we have 10 more in the pipeline. From that perspective, the capital market is certainly recognizing the change that I was talking about. And pricing those changes ahead. And therefore, we are benefiting from that. So that’s on the venture capital world. The people who have backed on the right companies on this trend, probably would have benefited the same as well.
Rita Yang
Yeah. You just mentioned we had six IPOs; you were on two of them – on the virtual IPO sessions. Maybe you can tell us one or two most memorable interaction you’ve had with founders this year.
Jixun Foo
Yeah. I must say it is. It was my first ever experience. I think, in the past, when people think about being part of an IPO is you would want to be there was in New York, or you’re in China. And this year, we had two I attended. The first one was Agora. That was in May. It was in Shanghai and, you know, I was trying to figure out like, what would that feel like?
Well, essentially you have a stage and you have a big screen. So, everything is happening on online live with New York at the same time. We now have a lot more people participating, because a lot more employees and management team members get involved in the IPO process and being involved in the whole IPO celebration. So that’s one. And then Xpeng, which happened just a couple of months ago, was pretty phenomenal as well, because I still remember the New York Stock Exchange had the US balcony built and shipped one of their bells to Guangzhou, where the IPO was held. That was a particular memorable one for me. Because, you know, just about three years ago, Xiaopeng joined the company full time. I mean, he incubated a business and was an angel, founding investor, if you will, and a year before that, I spend time encouraging him and pushing him to go all in on this business, which he did. I felt like I helped him make the right call. Now, it didn’t look that easy, initially. And, you know, three years on, and the company went public, and it has performed extremely well post IPO. And today’s a $40 billion company at one point was even higher. So, it’s memorable for the fact that for what I did, and it’s also memorable for the fact that, you know, Xiaopeng himself appreciated and recognized what I did.
Rita Yang
You were the person that he specifically singled out in his speech that night.
Jixun Foo
So that’s the very rewarding and therefore a very memorable part of my investing career.
Rita Yang
We talked about a lot of the highlights, what are some of the things that you saw as highly unlikely or impossible that all of a sudden become possible this year? Because of you know, what happened around us with the overflow of capital and the market being the way it is?
Jixun Foo
Well, to be honest, one of the big things for me this year, at least for my own personal experiences, was the Xpeng IPO. I must say that it wasn’t a given. We did make a decision to go IPO in, I believe, April, May this year, we have some preparations made. I still remember last year; we had a pretty tough time fundraising. Because there were a lot more doubts. Nio was trading at two billion dollars before it kind of went to a more recent high of 50, 60, 70 billion. So, it was very contrasting difference. where things were just about a year ago, and now, you know, the company goes out now. I think that for me is that the business and stock market will continue to be volatile. I do not know what the stock market will look like. I mean three months from now, a month from now. I think what holds true to me is a fundamental belief in the direction of EV (electric vehicles).. That’s venture capital. Venture capital is taking a long-term view on the trends and betting on the trend and on the people, or entrepreneur behind it. I think I was able to stay true to the cause of that, and, and seeing no currently the benefit of it. So, I never thought that it will be that valuable until it happened, huh?
Rita Yang
Yeah. So how has this year changed the way you look at investors or venture investors in particular, if it changed at all?
Jixun Foo
I don’t think this year has dramatically changed how I think about venture business. I think the venture business has been around for many years. But what I do see is more options in capital markets like the STAR Board. We are seeing more optionality for our entrepreneurs, for investors in general. I think that the if so I would call that another turning point, right. In the past if you’re a tech investor, you’re looking at NASDAQ, or New York listing. And then in a more recent years, you’re talking about Hong Kong listing. In the last one year, we are looking at the China listing. What is happening is this year in particular, and is becoming more and more apparent, why technology, why innovation is so important going forward for the economy growth, not just for China, but for many other regions. So, I think there will be a lot more investments. Along with that, we would need to be able to look at a balance in terms of the environment, looking at the sustainability of the environment. And I believe that there will be more investments into these areas over time.
Rita Yang
Okay. So, I mean, the first few months of this year, and now looks very different. I mean, from our working conditions in China at least, have you? How have your work style changed, evolved around these conditions? Have you developed any new habits or things you have changed in your routine?
Jixun Foo
For one, I find myself traveling less. I still go to Beijing. You know, China has kind of recovered from COVID quite well. I start traveling to Beijing in May I started, you know, going to Shenzhen, Guangzhou. I move around China, but I, I think the need to travel is reduced, right? A lot of meetings you can run on Zoom. You can run a lot of meetings more efficiently now, for the ones that you feel like, it’s important to have that face to face. I feel more efficient with my time than before.
Rita Yang
How was the virtual partner offsite?
Jixun Foo
I actually think that is more efficient, it’s very effective. I still remember. I think it was Hans or Jenny have told me and said you know, what used to be a three day off site now is a 3 to 6 hours off site. So essentially is quite half a day to three quarter of your day. It does take a toll on our concentration during that time. It does take away some of the personal touch points, which we do value a lot. It’s nice. I still remember my last offsite was also virtual, the last offsite was actually in Hawaii.
I mean, having that personal connection with people having the dinner and drinks and conversations on a broader scale is still important. So I don’t want to disavow the need to, for social interactions. But I think that the fact that we, you know, from purely from a work perspective, I would say, the productivity is pretty high.
Rita Yang
Yeah, it’s more condensed if you’re at a virtual setting. Okay. So speaking of efficiency, we’re going to have the last two questions. In 2020, what are the three startup or innovation that makes you feel Wow, why has no one done this before it? That’s amazing.
Jixun Foo
I’ve been in this business for a long time, around 20 years, so in a sense I’m always coming across new ideas and innovations. I do come across startups or innovations that answer some of my main questions like: Why are you solving this problem? Are you the best person to do the job? Is your timing right? What I’ve been spending most of my time on these past 9 or 10 months is centered around ideas powered by technology or AI.
So for example, AI with health care. AI, to supplement or to complement, to power a new service. The other thing I found phenomenal this year was the rise of the Chinese consumer, and the rise of the emerging Chinese brands, the domestic brands, just so because I think what’s really interesting is how the media shift from TV to long form video, from long form video to short form video, and how content is being consumed differently. And as a result, the social media impact on brand creation has changed. It gives rise to new opportunities. And the consumption behavior of the Chinese consumers has also becoming more selective, more personalized.
Rita Yang
Yeah, it has to fit the expression of who they are.
Jixun Foo
Yes, exactly. I’m not trying to just try to buy something so that I can be seen as such a person, I want to buy something that express myself as to who I am. And so that really gives rise to the social media changes, that we pass the fact that the cultural identity gives rise to new consumer brands, which is very powerful. And that’s something that again, we’ve seen Taobao brands in the past but I think this time around, you’re seeing a lot more pretty successful examples. But I must say that the third phenomenon I’m seeing is the migration to the cloud. I think China has not really or has just started to migrate to the cloud. And that migration is still early on, from private to public, from one cloud to multi-cloud, that cloud migration, I think will give rise to new opportunities in China.
Rita Yang
Great. So with those three trends, what are you most excited for the next year?
Jixun Foo
Well, I’m excited on all three. I’m hoping that COVID will be behind us next year. I’m hoping that travel and meeting people will become a norm again. But I guess that certain behavioral pattern COVID has set on us will not change. when they find a more efficient way, a better way of doing things, they will stick in them. I believe that. So, if you ask me what I look forward to next year from my perspective, I look forward to a post-COVID world where things are normalizing again, and that the economy will go back in a more normalized way. Very importantly, our 10 IPOs in our pipeline. I look forward to that.
Rita Yang
Thank you so much, Jixun. Happy New Year.
Jixun Foo
Happy New Year.
Thank you.
