In Conversation With Tang Binsen of Chinese Beverage Giant Genki Forest: A Mogul, a Pirate, a Product Manager

genki forest
(Source: Genki Forest)

This article is authorized to be translated from the original article of LatePost. Original title: 对话元气森林唐彬森:富翁、海盗与产品经理 Author: Song Wei, Li Shiyun, Huang Junjie. Editor: Huang Junjie. Copy editor: Peter Catterall

Serial entrepreneur Tang Binsen (唐彬森 Táng Bīnsēn) had operated in the internet industry for ten years. Although he had made it rich, his reputation hadn’t yet caught up to his earning power. In 2016, he entered the beverage industry, where he finally became a true internet tycoon.

Genki Forest (元气森林 Yuánqì Sēnlín, meaning ‘Forest of Vitaly’ – the company is sometimes referred to as ‘Yuanqi Forest’), founded by Mr. Tang, sold 100 million boxes of sugar-free sparkling water this year – 80% of which came from offline sales. The company has rushed into these types of commercial channels typically dominated by traditional industry giants. This year’s revenue from beverage sales is expected to total 8.3 billion yuan ($1.3 billion), reaching one-third the amount of Nongfu Spring, which has been established for 25 years.

A group of young gamers have created the biggest entrepreneurial success story in the entire Chinese consumer industry in the past five years – no one could have imagined this a few years ago.

38-year-old Tang may not have imagined it either. During the course of an entrepreneurial career lasting over a decade, he had attained success, but had invested mostly in short-term, fast-returns businesses such as web games, navigation platforms and tools for expanding overseas businesses. Tang then found the beverage industry, which had not yet been successfully transformed by the internet. He tried to toss out the rulebook and write a new one. This has a lot to do with his character and the self-confidence brought by his continuous entrepreneurial success. Coupled with fresh funding, everything seemed so lively – just like China’s internet over the past decade.

In Tang, one can observe three notable traits: a disposition of the superrich, brutal expansionist ability like a pirate, and thinking and learning like the best of product managers. These three advantages ensure that when he enters any industry, he may not always succeed, but it will always cause disruption.

SEE ALSO: Genki Forest Enters Coffee Market to Become the Biggest Shareholder of Never Coffee

Tang and his entrepreneurial story may someday become a classic case study taught in business schools. Whether about success or failure, it is certain to be extremely exciting.

The following is an interview with Mr. Tang Binsen with LatePost:

1

LatePost: The first explosive product of Genki Forest was sparkling water, but its success has not been replicated in other categories. Why?

Mr. Tang Binsen: It’s impossible for every product to be explosive, but each of our products sell well in their respective categories. Burnt Tea (燃茶 Rán Chá – one of Genki Forest’s key products) took two years to achieve second place in sugar-free tea beverages. The first place was Oriental Leaf (东方树叶Dōngfāng Shùyè – a competing brand owned by Nongfu Spring), which went on the market ten years ago. The annual sale of sparkling water is about ten times than of Burnt Tea.

LatePost: Ten times worse.

Tang: Because the latter category is small.

LatePost: Is there any category as big as sparkling water?

Tang: Mineral water, milk. In the past, there was a way of thinking prominent online. If a mailbox does not support large attachments, you should be the one that supports large attachments. If a chat software tends to freeze, make one that doesn’t. I call this playing style “sending sub-questions.” Mineral water doesn’t belong to the “sending sub-questions” category as its quality of production is already very good. Our company has a range of products. First, it depends on whether the market is big or not. Second, it depends on whether the ingredient list is better than others. Genki Forest still has a relatively low share of carbonated beverages, and there will be further room to develop in the future, and there will also be categories as large as sparkling water. The threshold for milk is also high, but we have the opportunity and need for the best milk and factories. We are building factories and farms one by one.

LatePost: Have you found any universal strategy or formula for replicating the success of sparkling water?

Tang: Actually, it is by daring to use good raw materials that opponents dare not use. If a food and beverage company wants to cater to the tastes of users, adding sugar is the cheapest way, adding artificial sweeteners is an expensive way, and there are some sweeteners such as aspartame that are cheap but have a bad taste.

One opportunity we seized four years ago was to take the lead in using the best sugar substitute, erythritol, which is thirty to forty times more expensive than aspartame. We are the first to dare to use such a good sugar substitute for Chinese customers. We also use the most gas, making the sparkling water fully carbonated. However, this makes it easy to burn off gas during production, bringing about a 5% wastage rate.

At that time, an R&D employee saw that our gross profit was only at 10 points, and he said that the boss wouldn’t be able to keep it up for three years. He left the firm after the statement.

LatePost: But Genki Forest’s Milk Tea (乳茶 Rǔ Chá) uses crystalline fructose. Is this the best raw material you can provide to customers?

Tang: Milk Tea is a very different product. If you reduce the sugar level, anyone finds it’s less enjoyable to drink. Using erythritol will give it a more unpleasant taste. We have no choice but to add a little fructose. You say ours is sweet but see how sweet others are. Many milk teas have long lists of ingredients, the overall cost is only .50 yuan and can sell 10 billion per year. The Chinese market is full of these products.

LatePost: You can’t just say yours is a good product because it’s better than poor ones.

Tang: If we know our mistakes, we can correct them. The Milk Tea produced after April of this year has removed the crystalline fructose.

The Chinese market needs good products. Many companies are building strong channels. As long as they have the goods, consumers don’t have many choices within the channel. Now, however, information is symmetrical and the channels are flat, so the product has a chance. This has also happened in the gaming industry.

Genki underwent three waves of personnel changes earlier, all of whom were beverage industry professionals. Later, I simply found a group of young gamers. I said that I don’t care to discuss cost, just make a product that I want to drink. We have a principle that before a product goes on the market, you must have ten people you know buy a box so they can prove it is reliable. Last year, we took the initiative to remove a fruit tea product. I told the team that its sales were low because although we have a channel, we couldn’t do that.

(Source: Genki Forest)

LatePost: I heard that Genki is like a game company. Many teams are racing and data is the only good resource.

Tang: I think that good and bad are not subjective, but relative – that is, one in a hundred and one in a thousand. Therefore, Genki’s product philosophy is not to say whether is good or not, but how many times you have tried it. Some of our departments have a trial-and-error budget of tens of millions per year. We do data tests on taste and packaging, and finally choose the best data.

Game firms in particular are capable of withstanding trial and error because failure is normal in that industry. Traditional firms hope to increase the success rate of their products. We admit that we don’t know the future, so we need to reduce the cost of every trial and error – these are the two worlds.

LatePost: How do you make employees feel that the company is willing to bear more trial and error costs through a mechanism?

Tang: We don’t encourage our employees to do things that only focus on the present and have short-term effects. The rewards are introspective. For example, this year we awarded the Burnt Tea team an award called “Product to Change the Company’s Destiny,” also giving the entire team shares of the company.

LatePost: How much of Genki’s methodology is adopted from the game company Elex (智明星通 Zhìmíng Xīngtōng) you started previously?

Tang: I said previously that strategy should be learned from investors in the secondary market, management should be learned like a pirate, and products should be learned from game companies. (Warren) Buffet uses his brains to get profits, so people who understand the strategy most clearly are those in the secondary market. Many companies may appear to be well managed, but it is actually because of their business excellence. If the company can lead the team well without making money and being bullish, it is like a pirate – putting one’s life on the line to carry out dirty work.

In terms of product capabilities, game companies are very strong. They put out many products each year, and they hang up if one fails. Many internet firms have strong surface product capabilities, but it is enough to produce one product, and they are maintaining this product at other times.

LatePost: In terms of products imitating game companies, channels and marketing, what did you do right?

Tang: In the past, convenience stores and mom-and-pop stores rarely connected to new products, because many new brands couldn’t make any money.

Pass through the channels one by one and accept the rules. In the first year, I told the team to prepare the small shop downstairs with large sesame seeds. The second stage is to obtain the approval of peripheral convenience stores, and then enter the mainstream convenience stores. The third stage is to form a national promotion team from the beginning, enter the mom-and-pop stores, and finally sink the market across the country. This is a long process. Now we have 6,000 dealers across the country, covering 800,000 terminals, 10% of which are convenience stores.

LatePost: It seems that the path to success of Genki Forest is no different from that of traditional consumer goods companies. It is nothing more than a big star, a big advertisement, and a big channel.

Tang: Last year, we only did one Focus Media (advertising), one Bilibili (online evening party), and named the three programs of Hunan Satellite TV. We hope that energetic users will have the lowest proportion of advertising and channel costs.

LatePost: But your ads are very fierce.

Tang: The purpose of advertising is to compete head-on with opponents. When doing business in China, if you don’t make critical efforts at a critical time, you will miss the opportunity.

LatePost: How can one achieve breakthrough ads?

Tang: The money we spent on the Bilibili online party was the same as that of some title vendors, but do you remember their advertisements? No. If we want to name it, we will name the best show of the day, and we will only talk about one product – sparkling water. At the time, the team opposed it, but I didn’t think it was an important thing. Spending more money and spending less money was not the main contradiction.

LatePost: There is always wealth in words.

Tang: It’s all a lesson. At that time, we were the first game company to publish farm games in the United States, but we didn’t dare to spend money. Our opponent Zynga lost $10 million a month. It will go public 12 months later, with a market value of 10 billion U.S. dollars. Later, I concluded that every seven years in my life, I will encounter a straight flush.

LatePost: Why every seven years?

Tang: If you have a good card every year, it means that this card is not good enough. If you have a chance every day, it is not an opportunity.

LatePost: What are the things that Nongfu Spring will do but you will not?

Tang: We develop our own smart freezer, which can remind the salesperson to make up if it is out of stock, instead of going to the site for inspection. Nongfu did not do this.

LatePost: Coca-Cola has had only one product for a long time, so why does Genki make so many single products? From the perspective of benchmark game companies, Supercell, for example, does not rely on a large number of products to bet on probabilities to win.

Tang: If you read the book “Creative Company,” you will understand that the quality products that users see are all internal failures. If I make a bad product and throw it on the market, it’s not called trial and error. Trial and error means trying in many directions, keep pushing down and do it again.

LatePost: Now colleagues have also replaced aspartame in sparkling water with erythritol. Where is your competitiveness?

Tang: We do an upgrade every six months. We have removed common preservatives such as sodium benzoate and potassium sorbate in our entire bubble water line. Moreover, sugar reduction is a global trend, and we will continue to reduce it. In addition to erythritol, there are also sugar substitutes such as steviol glycosides and luohan fructose used in product iterations. But these sugar substitutes are more expensive.

LatePost: The price of erythritol is rising rapidly. Will you go upstream in the future to control raw materials?

Tang: This is not something the boss thinks about. I only solve big problems, such as building a factory.

In March of this year, an international giant broke our supply chain. By putting pressure on our foundry, it immediately stopped cooperation. Our channels have also encountered challenges. We did not encounter such things in the early days when we were very young, but we will definitely encounter them after development. So, we have to build our own factories, and we have to build more beautiful factories to become attractions where you can sell tickets.

LatePost: This is contrary to your game strategy. You once said that the best business is to use a very thin product to hit the global market, rather than a very heavy product for vertical markets.

Tang: It used to be thin, but now it is more important, because the times have changed and the industry is different. Why build a factory? Because we want to shorten the ingredient list and make sparkling water without preservatives, but domestic factories can’t do it, we can only do it ourselves.

At that time, the production team said that to build a factory, there are two options, one of which is twice as expensive as the other, but it can be produced aseptically. What do I mean by aseptic production? He said that sparkling water can be used without preservatives. I said that there is no need to talk about it, just this. Because there is no preservative, we have to make sure that the cap is difficult to twist. Many consumers complained, so we introduced a bottle cap process from Germany to solve this problem. It cost more than 20 million just to improve one production line, and each upgrade of the production line requires a lot of money. 

Supply chain construction is a very slow process, but it is not difficult, it is a matter of cost.

2

LatePost: You were the first vigorous investor rather than the founder. What made you decide to change that?

Tang: After changing three groups of people, I really couldn’t find anyone to take over. The good entrepreneurs at the time were all engaged in P2P and O2O. That was the worst time for me, and at the worst, I charged a lot of money into it myself.

LatePost: “Charged” money.

Tang: Yes. We spent 5 million yuan on our first product. We asked a friend to drink it, and he would not drink it after one sip. The sales proposal sells the shop to the sinking market. I said that in this way our future brand will be ruined. In the end, it cost 1 million to destroy it, and the group of beverage experts that I was looking for also left. The second group of people, I said to engage in full stock ownership, low base salary and high performance, but results again eluded us.

At that time, COK (the game “Clash of Kings”) was raking in a lot of money and everyone asked me, “Old Tang, why are you still in drinks?” Every time I was asked this, I said I must be the last one to give up. In 2016, I took over Genki Forest and did it myself, also to show my own determination.

LatePost: In 2014, when you were 32 years old, you sold Elex. Why did you sell it? The rise of a new generation of game companies such as Mihayou today proves that there is still a lot of room in this field.

Tang: They love games, I don’t. I only hope that China has something to do. I don’t play games either. Playing games every day is like going to jail, and I earn money.

LatePost: You don’t love games, and still make so much money – are you happy in your heart?

Tang: Unhappy. In the year we sold the company, we were third place in the Chinese game industry. I was also enTangled, but then I wanted to understand that when making major decisions in life, you can’t settle accounts, and the situation is very small. Just think about what you want to do in the next 20 years? Do it even if you don’t make money. I said I definitely don’t want to do games.

The company sold 2.7 billion, and my friends felt that I was losing money. Because profit that year was 150 million, it had doubled seven times after the sale.

LatePost: It means that the person who took over is better than you in managing the company.

Tang: Our business foundation is very good, and the team has always been stable. We were the first to make games overseas in 2008. But in 2014, overseas games were all Chinese companies. I proved that it is possible for the Chinese to make this track, and when the mission was completed, I felt bored.

LatePost: It sounds like your criterion for ending and starting something is whether the Chinese have done it on this track. This is true for games and for consumption.

Tang: Knowing a person depends on how he earns his first pot of gold. The first pot of gold in my life was earned as a graduate student of Beihang University in 2004, when I participated in a programming competition overseas and beat a foreigner to become the first one, earning 250,000 euros.

At that time, the competition was at the 3GSM exhibition in France. We were a Chinese team and we had no relatives. Then we saw Huawei’s booth. They are the only Chinese company at the show. Do you know how it feels to find relatives? We also ran to the Huawei team and said that we are also Chinese. Therefore, Genki Forest later had a brand label called Zhonghua Youwei (中华有为 Zhōnghuá Yǒuwéi – “China is promising”).

LatePost: You are a serial entrepreneur. What do you know how to do well and what you are not good at? You have also built a cloud computing platform, but it failed.

Tang: There is no good or bad, everything is fate.

Standing at thirty is to try and make more breakthroughs. Forty is not confused, find and focus on the things you love. But in the end, you will find that it is fate. Whether the business you make is good or not, this determines who is the best. The three largest internet companies before China, South Korea and Russia are all search engines, social networking and e-commerce.

Some people stand at fifty and stand at forty without confusion. At thirty, they are stupid if they know their destiny; more people stand at thirty without confusion, and stand at forty, but it’s not alright. The rhythm cannot be wrong. Many internet giants have run into big opportunities, and they didn’t think much about it. But we really need to find opportunities, so we must continue to start a business and keep looking for answers. These are called “nomads.”

LatePost: Don’t you want to find a fertile market?

Tang: I’m here to make drinks.

LatePost: Is this just because this it’s a big business, not because you have a sense of mission?

Tang: I established Challenger Capital in 2014 with the mission of “promising China, challenging giants, investing in good products, and trusting young people.” “China is promising” means that there are no Chinese companies in the top ten in the industry that and we should invest; “challenge the giants” means that I think there is no new concept in this world, and we should focus on old business. At that time, many industries were selected according to this logic.

I think many companies must understand their strategies. I believe that Chinese people are awesome, so I want foreigners to be their opponents. (Warren) Buffett has a saying: If you want to win the championship, don’t be at the same table as the world champion. I think the best table is to compete with foreign companies, not local companies, because local companies are very good.

I also invested in a company called Tiger Securities before. At that time, the founder wanted to do stock trading software. If the opponent is a $100 billion company, you’re awesome, if the opponent is a $100 million company, it’s useless.

LatePost: When people evaluate you, they often say your motivation for achievement is obvious. When you do something, you don’t always think about how valuable the thing is, but how to win – how to win the most.

Tang: You must win if you want to create value. If a person does not win the battle, he cannot create great value. Scholars are very awesome, bandits are also very awesome, but the most awesome one is the person who integrates scholars with bandits. So, winning is very important.

LatePost: Are you a scholar or a bandit?

Tang: I am the one who integrates the scholars with the bandits.

LatePost: A man who wins big bets.

Tang: Big bets and big wins are a result. The key is that you have to have sustained tenacity. Our company has a culture, and it’s not good to refrain from playing boss games. Whether you’re awesome or not depends on how many times you have encountered things that make you want to give up. The more you want to give up, the more you know.

LatePost: How many times have you thought about giving up Genki Forest?

Tang: Many times.

LatePost: What happened in the process from your feeling that the industry is good to the products being settled?

Tang: I saw most consumer companies that do well in the Chinese market are foreign investors. I want to make a good drink worthy of the hard-working Chinese, just like the United States has Coca-Cola and Switzerland has Nestlé.

LatePost: Some people think that when Genki started to become related to Japanese brands, it borrowed from the trend and was also a brand failure, because today Chinese consumers pay more for “made in China.”

Tang: We really set up a Japanese company. There are more than a dozen people doing R&D in Japan. After a year, we felt that something would go wrong, so we told the team not to do it. So we later emphasized the characters “燃” (rán, “burn”) and “気” (qì, the Japanese version of 气, meaning “vitality” or “air”). We want to sell whisky to the world in big Chinese characters like Suntory in Japan.

LatePost: But this “気” is in Japanese.

Tang: The wider Asian culture is profoundly influenced by Chinese culture, and it is impossible to strictly define whether it is Japanese or Chinese characters.

LatePost: The brand core of consumer goods is very important. Coca-Cola has been emphasizing the word “enjoy” in the past few decades. So, what is the core of Genki Forest’s brand?

Tang: Plain is true. We want to be the ordinary companions of consumers. I once wanted to shoot an advertisement. When someone gave you 999 roses, I would accompany you to get off work on time and never give up. We want to provide more people with a more inclusive, high-quality and better life.

LatePost: To build a food and beverage empire today, how will it take a different path compared with established foreign food and beverage giants?

Tang: We do not build, we solve problems. In the process of solving the problem, the layout gradually became clear. Is it useful to force it?

LatePost: What company will Genki Forest end up being?

Tang: A company that solves problems. If a problem is solved well by existing companies, it is meaningless for you to do it. It is to grab someone’s cake. The world will not reward companies that grab someone’s cake. The entire human information system is constantly encouraging more to humans. Good behavior.

LatePost: What is the ultimate problem that mankind has to solve?

Tang: The ultimate human problem has nothing to do with me. I can’t solve it, and I’m not at that level. But one thing I believe is that the beverage market will ultimately fail to outperform the game, and the growth of physical consumption will certainly fail to outperform the virtual in the long run. Products that meet high-level needs in human society will become more and more important, and products that meet basic needs will account for less and less of a country’s GDP.

Games are the ultimate direction of mankind. The past 100 years have been the history of constantly moving real things to the virtual world. Don’t you think that realizing oneself in a real world consumes environmental resources too much? The game is to make people realize themselves in the virtual world, environmentally friendly and efficient.

I don’t play games, but I like the underlying essence of games, such as IP. IP is very similar to brands. In the future, Genki Forest may work with the game company I invested in to develop IP together, otherwise it will be empty again.

LatePost: Under what circumstances will Genki Forest be eliminated by the market?

Tang: Elimination is destined. There are always young companies and young people appearing, and this industry has a future. As a leading company in the industry, the best strategy to make the industry better is to die by yourself. If you don’t die, if you survive as an old company, the industry will have no future.

3

LatePost: Some people say that Genki internally motivates employees like pirates, regardless of seniority, but on merit. If you do well, you will be rewarded with options, and OKRs will be deducted directly if you don’t do well.

Tang: I was born to like teams resembling pirates. One of the basic laws of Genki Forest is that you can’t cause honest people to suffer, you must be cruel to bad people, and you can’t be egalitarian with good people. I personally own no more than 50% of shares in Genki, with more than a dozen investors, and the rest are team members, and 20% of the employees are company shareholders. I think a company organization should have a kind of brotherhood and banditry, should not be too professional, and should have the feeling of pirates. This means that everyone is equal and simple, and that a bunch of loving and righteous people do a meaningful thing. We can’t make too many rules and make the distance between people get farther and farther. It should be more sincere and simple.

LatePost: Your colleague said that you send hundreds of thousands of “red envelopes” (红包 Hóngbāo – traditional Chinese gifts containing money) on WeChat every year.

Tang: I often do some questions and answers about values, and I will give red envelopes to whoever answers correctly. For example, ask “Which saying of our company does this breach?”

LatePost: Give an example.

Tang: “If there is a communication problem, both of you are idiots”; “A good company is a gym, and a bad company is a pig farm.” The gym is tired when you do it, and you feel good after you finish it. The pig farms are cool when they go, and they are slaughtered when they go.

LatePost: There are thousands of people in Genki Forest. Have you ever thought about how to manage the tens of thousands?

Tang: If there are tens of thousands of people, the most important thing is to manage the product team. The management of this problem will become simpler with systematization. In contrast, it is difficult to find the core problem. What problem does the company exist to solve? If you don’t want to understand, you are tactically right and strategically wrong.

LatePost: How much money do you manage?

Tang: The company rarely approves it to me.

LatePost: Under what circumstances will you compromise?

Tang: Most situations I encounter are authorized, so I rarely compromise anything.

LatePost: When will you take over?

Tang: When it is a critical moment and others are afraid to make this decision. There is a kind of decision that you have made right, and people never feel the value of being right. There is also a problem – it must be because you did not do this thing.

LatePost: Several senior executives in the early days of Genki have left to start a beverage business. How do you view this?

Tang: I’m used to it, bless them. A senior executive who went out gave me a box of Moutai (a leading brand of Chinese baijiu) last year. I said no. He had to give it. Then he asked for it. It would be a bad idea to return it.

You have to think, a good company will not let good people leave. If you depart with a bunch of bad guys, it means that this company is awesome. If the people who leave are all talented, it means that this company is stupid.

LatePost: You also recruited executives who resigned from ByteDance. Does that mean that ByteDance is awesome or foolish?

Tang: This person was recruited because he is a person who loves the product, who has love and does not worry about money in order to make the product.

LatePost: An investor would like to ask you, why are the terms for investors so harsh when Genki Forest is financing? You’re also an investor – do you want to be treated like this by entrepreneurs?

Tang: Does this investor want to invest?

LatePost: Yes.

Tang: Isn’t it over? I didn’t force you anyway. We set this valuation at the time. They were all robbing, so let’s grab it. I said that it will be given to whoever comes anyway. I will create this atmosphere without raising the price, and everyone is rushing in.

LatePost: What projects do Genki Forest carry out by itself, and what projects require Challenjers Capital?

Tang: Challenjers doesn’t do what Genki Forest can do, but Challenjers solves problems that Genki Forest cannot.

LatePost: Like baijiu, for example?

Tang: Genki is also developing baijiu and beer, but the boundaries are still not clear. You can’t be too anxious about wine. In the end, all consumer goods that survived in China were made by state-owned enterprises because of slowness. We also recently invested in a British children’s food company and bought an oat milk firm from Australia. Our philosophy is to serve the global market with the best things in the world.

LatePost: How do you choose the CEO of an acquired consumer product brand?

Tang: Seeing whether a founder has made money is the simplest and most basic way to prove their ability. Shen Nanpeng (founder of Sequoia China) once asked me: Is the “Vitality 28” project good? I said that the boss made 20 million with his own business – you can figure it out.

4

LatePost: I heard that you often bet with people. In March 2019, you made a bet with an investor on whether Pinduoduo would work.

Tang: There were two bets, one on Luckin Coffee and one on Pinduoduo. I bet that neither of these would work. In the end, I lost on Pinduoduo and won on Ruixing, which happened to be a hedge.

There is a story in the book “Reaction Forces.” At that time, no one thought that the Lebanese War would last for more than 10 years. Everyone thought that it would be over in one year. But looking at it in hindsight, everyone felt that it was at least 10 years. The advantage of betting is that it allows you to remember your decision at the time. I also like to keep a diary, so I can always see how stupid the decision was at that time.

LatePost: What are you good at betting on?

Tang: Cognition. So, when I bet in my company, I basically win. For example, I said to raise the price of beverages. My colleagues said that the price increase would affect sales. I said will you guys try to see the impact?

LatePost: Why weren’t you optimistic about Pinduoduo at the time?

Tang: I also reflect on this. I understand the logic of my product as a platform – this is wrong. The company that makes the product can’t burn money. If the user really loves your stuff, you shouldn’t lose money. So I thought that Pinduoduo subsidized too much, maybe because the platform was not good, but I didn’t expect to supplement the platform. The platform must be rewarded because it improves the efficiency of the product, which is a different story from the product company.

LatePost: In addition to the hobby of writing a diary, I heard that you have continued to watch CCTV’s evening news broadcast for decades.

Tang: I used to watch it every day, but now I’m too busy. I can only watch it once a week, seven days at a time, fast forwarded, allowing me to finish it in 20 minutes.

You don’t know how to watch it, right? There’s a video hotspot on Xiaomi TVs; click into it, and there is a news broadcast channel which can be played back.

LatePost: What will make you stop the video when watching?

Tang: What projects have been finished, what roads have been built, and how this helps the poor. I’ve always loved watching since I was a child, and every day I see positive changes in the country.

LatePost: I have loved watching the CCTV evening news since I was a child. What was your ideal at that time?

Tang: I wanted to be the mayor of Hefei, but I failed to join the communist party. When I was a squad leader in high school, I was removed because I told the teacher in charge, “You have a problem with this (mathematics) solution.” The teacher was shocked and asked what I was on about.

LatePost: If you became the mayor of Hefei, would you invest in NIO?

Tang: I don’t know, maybe I would think in another way in that system. People’s values are formed when they are young, so I know what age a person is when I hear them sing.

LatePost: You were born in 1982, and your friend said that you love to sing “On the Water” – what era are you really from?

Tang: Ren Zhengfei and I are in the same generation. Because I grew up with my grandparents, my grandma sings Teresa Teng’s song, and my grandpa sings “Singing for the Motherland” – do you understand that I cry when I hear “Singing for the Motherland”?

I also love to sing “The Kingdom of Daughters.” I think Tang Seng can pass other levels, and the most difficult one is “The Kingdom of Daughters.” I often say that the boss must have mental power, not brain power. So I think Tang Seng is the best CEO.

LatePost: You have repeatedly expressed your admiration for Huawei. Why do you admire them most?

Tang: I think Ren Zhengfei is a person who speaks basic truths in the vernacular.

When I was in college, I especially wanted to ask the school why it didn’t teach us to learn Java and PHP and would instead always talk to us about computer systems. I think there is something to talk about there, but it can’t solve the big problems. I said I’m going to write code and build a website. I even want to sign up for a crash course on some website. Later I understood that some things have changed. Today you need Java, tomorrow you need PHP, and after two years you need other things. Those things are not worth learning. What is really valuable is the most basic things such as systems, language and mathematics.

The same is true for business. Ren Zhengfei is right. There is no need to rationalize. If tofu is made well people will buy it. There is a model of business schools in this world whereby courses are sold to make money and induce everyone to make quick progress. But the real best educational institutions are Harvard and Yale. They first teach principles. They expect graduates to donate money to them, so they must find a way to educate the students well.

LatePost: But you attended China Europe Business School and Lakeside College.

Tang: I had nothing to do back then. I never felt that class was important – I made friends and left.

LatePost: Who is a true friend in your heart?

Tang: I once told freshmen at China Europe Business School that there should be four principles in business school: First, do not face opportunities, but face future trends. Second, don’t make business partners, but make friends of the soul. Many people go to business schools to do business, and these kinds of people get worse and worse. I think a CEO is very lonely and needs some people to drink and chat. The third is not only to look for things that change, but to look for things that are unchanged.

LatePost: It’s a good summary, but this is what Bezos said.

Tang: It doesn’t matter if I quote it. I like to study what the people who have made money say. Bezos, Jobs, Buffett, I don’t believe what others say.

LatePost: You like to use two words – one is “niubi” (a vulgar word loosely translated as “awesome”) and the other is “shabi” (another vulgar word meaning “idiot”) to describe things. Why?

Tang: Simple and direct.

LatePost: Are there more moderate descriptions?

Tang: Are moderate descriptions important? Most of my own situation is like this, occasionally “niubi” occasionally “shabi.”

About LatePost

LatePost (www.latepost.com) is a business news outlet, cofounded by Caijing Magazine, one of the most influential financial news publications in China.

LatePost’s official WeChat account reaches an audience of 1 million readers per month who seek the news and information critical to their business. Another 15 million readers read our stories on other Chinese social platforms.

Our original editorial insight was that Internet companies had migrated to the absolute center of China’s economic operation. Now, they have become the most vital infrastructure of China, wielding enormous power but also attracting scrutiny from the public and the authority.

The LatePost strives to seek the truth in this sector, regularly publishes hard-hitting investigations and high profile interviews. We have interviewed most founders of big tech companies in China, Including Zhang Yiming of Bytedance, Colin Huang of PDD, Wang Xing of Meituan, and Lei Jun of Xiaomi.