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Wen/Gu Yue
Source: Brocade (ID: jinduan006)
Another popular word, Metaverse, has recently emerged in the Internet technology community, which is keen on creating words (concepts).The term originates from the science fiction novel Avalanche written by Neil Stephenson, an American Cyberpunk science fiction writer, in the 1990s.
Until March this year, Roblox, an open world game company in the United States, packaged it as a "convergence culmination" concept integrating many cutting-edge technologies such as "VR/AR, AI, cloud games, 5G, digital currency" in the IPO process, and with the stock price rising for more than three consecutive months, the word "meta universe" gradually ignited the global Internet industry, and was happy to "copy to China"20% of Chinese practitioners introduced into the Chinese world.
Figure: The technical connotation of the concept of meta universe.Source: Tianfeng Securities Research Institute
Among them, the Chinese company with the most "learning" ability is Soul, a company that has been using English brand names in the field of social software.In its IPO prospectus to the United States submitted in early May, this stranger dating software company, which claims that "there are no lonely people in the world" as its original intention, claimed that "Our mission is to build a" Soul "social metaverse".
Figure: Soul's description of the metauniverse, source: prospectus
It is hard to see what kind of universe the metauniverse is through the company Soul in the public information;What we can see clearly is that Saul, who started with technological innovation and paid special attention to and emphasized this gene, finally chose another hot word parallel to the "meta universe": lying flat in the process of transcending industrial competition.
However, in this flat "soul metauniverse", there are many recently highly fermented metaphors about byte beating and Tencent.
01
compromise
In the past 10 years, there have been an endless stream of companies trying to challenge the dragon Tencent Holdings (HK: 00700) from social networking, gaming, information and entertainment tracks.But the fate of most of them is like Luo Yonghao's "bullet message" in the end.
From the perspective of ordinary investors, most of the winners are just Zhang Yiming's byte beating. Following the AI technology with comparative advantages (represented by the well-known recommendation algorithm system), Tencent's information and entertainment empire has opened a gap.
Soul is one of them.Its fate is not "GG", but it is inevitably full of compromises: Tencent subsidiary invested in Soul in May 2020 and May 2021 respectively, holding 49.9% of shares in total.
Figure: Soul's main shareholders, Source: Soul's prospectus
As for similar business phenomena, in previous analysis reports such as BAT's "New Organizational Cycle", we made a clear point:
"Although innovation does not distinguish between advantages and disadvantages, especially in a specific time and space context, model innovation is more efficient. But it is obvious that, in the final analysis, model innovation should be carried out by relying on technological innovation. For most Chinese and even global technology companies, it is an established reality that model innovation is unsustainable, and a new round of innovation will certainly focus on hard core technological innovation."
This view is not to advocate that technological innovators are invincible, because many technological innovation dimensions are too single to defeat deep-rooted model innovation.Just like Tencent's main game, it will not be defeated by NetEase, Mihayou, or the weak bytes of game players in the next medium cycle. Its dragon slayer will only belong to the future hard core cloud game company with AI, cloud computing, VR and other hybrid intelligent modes - the start of opportunity depends on a new technological revolution.
More specifically:
Many companies that have become bigger through model innovation have a distinctive feature, the network effect - in short, the more people who use it, the better.Later model innovation competitors were unable to challenge inertia and overcome migration costs.
Like Sina Weibo, which was founded in 2009, it is a new type of media that draws on Twitter. McLuhan's "media is information" theory supports this kind of model innovation.
Figure: McLuhan, Source: Network
With the flow of Sina portal website, a group of star TV players quickly attracted a large number of users, which in turn drove influential people to settle in Sina Weibo, bringing more users, and the network effect began.
After the success of Sina Weibo, even if the other three portal websites (Tencent, NetEase and Sohu) have launched their own microblog products, even if Tencent Weibo was established only eight months later than Sina Weibo, even if Tencent Weibo had public relations with celebrities, sent Apple mobile phones and subsidized content, it still could not shake Sina Weibo like model innovation.
Another example.
In 2018, a famous traitor appeared in the social application market dominated by WeChat - Bullet SMS.Luo Yonghao, who was still on the Hammer mobile phone at that time, had been working hard on WeChat for a long time and decided to develop an instant messaging application that was "lighter" than WeChat.
Not only the bullet messages, but also the multi flash of bytes.so what?Bullet short messages and multi flash have a rough end. They have novel voice and expression functions, subsidies, flow pools, and challenged dragons.
Above, in contrast to the protagonist of this article, Soul, although he has a lot of characteristics in the algorithm technology innovation of data-driven social networking, it is far from enough to make him become another social version of the byte beating.
02
tearing
Model innovation can only be torn apart by technological innovation - for example, the headline is tied to Tencent. Although it is far from being defeated, it has at least stood out in the cracks... In particular, the Tiaoyin has become a leader in the Internet entertainment model, and the entertainment empire built by Tencent has lost its luster in front of it.
Combined with the rise of several products, Soul will be particularly interesting.
Soul is a social software company for strangers to make friends. It submitted its IPO prospectus in the US stock market on May 11.Soul's revenue in 2020 is close to 500 million yuan, with a year-on-year growth of 604.3%.From the user data, in Q1 2021, the number of active users reached 33.2 million, with a year-on-year increase of 109.4%.The number of post-90s users reached 73.9%.The average number of paying users is 1.54 million, with a payment rate of 4.8%, which has formed a certain climate in some areas.
Like today's headlines and dithering, the core of Soul's technological innovation in the field of algorithms is to tag users, digitize users, and then use algorithms to connect users and users, ultimately forming a network effect, hoping to use technology to make strangers social and get rid of "strangers".
Figure: Today's headline tagging and algorithm matching, source: network
The difference is that today's headlines have been tagged for several years, and dithering shortens the process, while Soul completes this task faster - it finishes tagging when users register (see the following figure).Then, through the user's social behavior, constantly modify tags to enrich tags, so as to break through the original fuzzy and disorderly social connection between users and strangers.
Figure: Soul tagging and algorithm matching, source: Soul App, brocade
From the perspective of user data and algorithm matching, although WeChat hopes to break through stranger social interaction with "shake", "people nearby" and other functions, the matching efficiency between users and strangers is very low, and the distribution mechanism is also very chaotic, which cannot break the existing acquaintance circle of WeChat, even if it has more traffic.
This is why Soul was able to achieve the separation of vassal states under the condition that WeChat unified the social field.
In this case, why was Soul included by Tencent?
As mentioned above - mode innovation should be carried out by relying on technological innovation, and the rise of headlines today is like this: in a simple and crude way, it is the logic of labeling and algorithm at the technical level, but at the same time, it uses the aggregation mode to solve the problem of massive content supply, which saves the old nose money (the content produced by traditional content providers needs to be written by journalists every stroke).
This has been criticized by the Beijing News and other media for infringing copyright, but today headlines grow too fast without the bottleneck of content creation. Under the Jin and Yuan Dynasties, copyright issues will not become a problem.
That is to say, even if there is technological innovation, the model should not be lost. If the model is used well, it can save a lot of costs on the production side or the marketing side, which will speed up the success of the company. Otherwise, it may not be warm, or the direct cash flow may be exhausted.
Like the fluent English named by Ali Zengming on Smart Business, and the exploration of Momo acquisition, these are companies with something in the dimension of technological innovation, but they are developing slowly.
Specifically, what is the problem of Soul?
Soul called himself "Soul Metauniverse" in the prospectus.Since it is a meta universe, the social interaction formed by tagging algorithm matching is only a part, and other elements such as virtual identity, open self creation, immersive experience, economic system and so on are also in place.But Saul is only strong at the social level, which is the problem.
Figure: Metauniverse and Elements, Source: Guosheng Securities
There are many problems for Saul at the growth stage. The potential energy of tearing technology is far from enough, so it is difficult to challenge giants. It seems a good choice to join if you can't fight.But even if you join Tencent, you still need to face and solve the remaining problems.
03
difficult problem
Soul's choice of the path of technological innovation to enter the social market is his plus point, but this is only the beginning. What remains is whether the prospect is broad and what must be experienced in order to capture the market.
【1】 General direction: "Follow the soul to find another you"
"I am lucky to find my only soul mate in the vast sea of people; no, my life, that's all." - Xu Zhimo.The poet's writing reflects the most simple psychological needs of every ordinary soul, hoping to meet someone who understands you.
The seventh census has established the basic framework of Soul's business logic.According to the survey, there are 240 million single people in the country, and the regional structure of men and women is unbalanced. There are many leftover women in the first and second tier cities. Singles are common in the sinking cities. At the legal level, there are 34.9 million singles in the country, of which 17.52 million are at the marriageable age of 20-40 years old, and the gender ratio has reached 108.9, which has been seriously unbalanced.
In addition, young people are generally anxious and feel that "there is no place for soul". In terms of user needs, Soul's product positioning of "soul communication" can be said to be just right. After all, beautiful skins are the same, and interesting souls are one in a million.
【2】 Crossing the Robbery: When will the network effect smooth the operation cost?
In front of interesting souls, money is not a problem, but the question is whether we can match as many interesting souls as possible before the money is spent.
At present, the main problem Soul faces is that users rely on marketing to promote.User data of 2019, 2020 and 2021 Q1:
Monthly active users: 11.5 million, 20.8 million and 3.2 million;
Number of paying users: 269000, 929000 and 1544500;
Paid user rate: 2.3%, 4.5% and 4.8%;
Single user payment: 21.9 yuan, 43.5 yuan and 48.6 yuan;
From the data point of view, the proportion of paid users and the growth rate of paid amount of Soul have slowed down, but its user size is not enough to support the network effect of the platform.Therefore, the marketing expenses invested heavily - 200 million yuan in 2019, 620 million yuan in 2020 (a year-on-year increase of 203%), and 470 million yuan in Q1 2021 (a year-on-year increase of 772%) - will continue.
Figure: Income Statement of Soul in Each Quarter, Source: Prospectus
What's more embarrassing is that Soul's cash flow is actually not abundant.As of 2021Q1, the cash reserve is 475 million yuan. Although the revenue is also growing steadily, it is not as fast as the growth of marketing expenses.The revenue in 2020 will be enough for the marketing expenditure in the first quarter of 2021, excluding other expenses. Soul is still losing a lot of blood.
03
metaphor
From a member of the dragon slaying corps with high morale to Lying flat joining the dragon corps, Saul's history so far has fully explained "a person's destiny, of course, depends on self struggle (technological innovation), but also takes into account the historical process (the potential energy in the era of model innovation is too strong)".In any case, its choice is in line with the maximization of its own interests, and there is no need to criticize it.
Looking through its fate, we can see that the current game between the bytes and Tencent, which has fermented a small climax, is a model innovator following a more powerful potential energy of technological innovation, making a choice in a higher dimension - lying flat is impossible. What I want is a "beating universe".
However, before its own technological innovation was not enough to shape the metauniverse, all the indignation recorded in the text was still just an impetuous catharsis - just like the traditional media in 2014, they raised difficulties about its copyright. Today, what is right and what is wrong?
"Fear is fear itself".If A is afraid of B, then the fear itself is B's fear - as you ask Tencent, is the fear of others to you your fear?
At the end of the article, we quote once again our relevant views in many previous analysis reports such as BAT's "New Organizational Cycle": "2021 is destined to be the origin of the failure, collapse and restart of the organizational culture of Internet technology companies. The essential reason for this cycle phenomenon is the stagnation of innovation of technology companies themselves."
In such a period of stagnant technological innovation, the technology giants must choose between two paths:
Or, let the game theory become a prominent company science, and exchange space through law, public opinion and business war.
Or, get involved in basic research, neither be happy with things nor be sad with oneself, and exchange future rebirth with the consideration of technological revolution.
As of today, we have seen more scenes, but only the first.
