"Actually, there is also the issue of information resources. Once the internet is fully available, we only need to promote it online, and the number of tourists will naturally increase gradually."
“There’s a vacuum in the domestic travel industry. You can get in touch with the right people, and I’ll have Pony Ma and his team develop a website and set up a bunch of travel agencies. Once you have a good reputation, this is a very lucrative business.”
This brings up another question for Shen Fang: hotels. There are chain hotels in China, such as Jinjiang Inn, 7 Days Inn, Super 8, Hanting, Home Inn, and City Comfort Inn, most of which were established between 2003 and 2005.
The earliest chain hotel was Jinjiang Inn.
In 1996, Jinjiang Inn's first store, "Jinjiang Amusement Park Store", officially opened at No. 227 Hongmei Road, Shanghai.
Before that, the general public only knew about star-rated hotels, such as Hilton and Victoria Hotels.
However, most business travelers in China still prefer guesthouses, small, unbranded hotels, and inns.
There are no so-called chain brands, and there aren't any particularly high requirements. As the economy gets better and better, people are paying more and more attention to the quality of their accommodation.
The emergence of Jinjiang Inn broke with conventional wisdom, offering a unified brand name, uniform attire, consistent decor, standardized service, and standardized rooms. Uniform linens, quick service, and high-quality amenities ushered in a revolutionary era for budget-friendly hotels in the Chinese market.
Clean and tidy accommodations and attentive service formed the earliest standards of hotel service. Of course, the most important factor was affordability.
In first-tier cities like Beijing, Shanghai, and Guangzhou, you can stay in these budget hotels for just two or three hundred yuan. They offer a slightly upscale atmosphere and have become the preferred accommodation choice for many young people and business travelers.
Thus, thanks to the combined effects of high-quality service, environment, and cost-effectiveness, China's budget hotels entered a vibrant "budding stage."
During Jinjiang Inn's rapid development, a large number of budget hotel brands such as Home Inn, 7 Days Inn, Super 8, and Hanting emerged, quickly establishing a chain hotel presence. Franchise stores sprang up one after another, and in just over a decade, they had expanded their reach to major cities across China, regardless of whether you were in a first-tier, second-tier, third-tier, fourth-tier, or fifth-tier city.
After the turn of the millennium, China's budget hotel industry entered a golden decade of rapid development. The most significant event of this was the wave of "giants" going public in the United States.
Shen Fang also thought of someone else: Shen Nanpeng, the king of investment. Shen Fang didn't care about this person's background. As for why he thought of him, it was because he founded Ctrip and was the first to discover the vacuum in the domestic travel industry, wanting to make money from it and throwing himself into the industry.
In 1999, Shen Nanpeng resigned from his high-paying job at Deutsche Bank and chose to return to Shanghai, China to start his own business.
At the time, the US internet industry was booming, while China's was just emerging. Shen Nanpeng keenly observed that the opportunities for internet development were unprecedented, and he believed the Chinese market had enormous potential. However, there were already too many people entering the field. People like Pony Ma, Dongzi, Zhang Chaoyang, Ding Lei, and Lu Yun had already occupied all the viable and profitable sectors. With the national internet industry entering a period of explosive growth, there weren't many opportunities left for him.
By chance, he discovered that domestic tourism revenue had reached hundreds of billions of yuan, and China had been recognized by the World Tourism Organization as the world's largest tourism market in the 21st century. After conducting market research, Shen Nanpeng found that 90% of the tourism market consisted of independent travelers, and thus he discovered a huge business opportunity.
In 1999, Shen Nanpeng invested 2 million yuan to co-found Ctrip with his friends Liang Jianzhang and Ji Qi, aiming to apply the Internet to the tourism industry.
Subsequently, Ctrip received three rounds of financing from investment institutions including IDG and SoftBank.
Ctrip quickly became a leader in China's online travel market. However, the internet winter of 2001 had a huge impact on the travel industry. However, Shen Nanpeng, with his meticulous thinking and strong management skills, launched the "Six Sigma" management model. By specifying and monitoring the operating process, he minimized potential errors and waste, thereby reducing costs and increasing profits.
In late 2001, Ctrip completed its fourth round of financing.
Subsequently, Shen Nanpeng discovered in his market research that high-end hotels were expensive while low-end hotels had poor environments.
So he founded Home Inns, a chain of budget hotels, to provide competitive budget hotel services. Today, Home Inns dominates the budget hotel market in China. In 2003, just four years later, Ctrip successfully went public, reaching a market value of 560 million yuan, earning Shen Nanpeng 20 million yuan. This money became Shen Nanpeng's first pot of gold in founding Sequoia Capital.
A diverse mindset is more decisive in shaping one's life than diligence.
In a public speech, Pony Ma said, "In the past, Tencent has invested hundreds of billions of dollars. Basically, for every project I see, Shen Nanpeng's team has already been involved for one or two years. So his vision is very unique and very good."
In 2005, Shen Nanpeng founded Sequoia Capital China, thus transitioning from an entrepreneur to an investor. Shen Nanpeng's consistent investment philosophy is "investing in companies with long-term growth potential," and given this philosophy, he personally prefers to invest in early-stage projects.
In 2006, Shen Nanpeng made his first investment. He was impressed by Qihoo 360's "community + search" model and decisively invested $7 million. At that time, Qihoo 360 had only been established for one year. In 2011, Qihoo 360 successfully went public on the New York Stock Exchange, and Sequoia Capital received a 48-fold return on its investment.
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