Interview with Babbitt 丨 Ten thousand bucks against the trend, focusing on supply chain finance

Recently, the industrial financial blockchain service provider Yange Blockchain announced that it has won a 10 million yuan PreA round of financing, and the leading investor is the listed company's construction.

At the moment when a new type of coronavirus is raging, small, medium and micro enterprises are struggling to survive. According to data released by Tsinghua University of Beijing, 85.01% of enterprises can maintain a maximum of 3 months, and only 9.96% of enterprises can maintain more than 6 months. It is rare that the pigeon chain can get the investment of listed companies smoothly and quickly in the epidemic. It also played a boost to the blockchain industry under the epidemic.

It is understood that the Qiaoge Blockchain was established in 2018, and currently holds 8 core technology patents, and has passed the second batch of blockchain information service filings by the State Cyberspace Office. The industrial financial blockchain platform created by the Qiaoge Blockchain can effectively solve the difficult and expensive financing problems of small and medium-sized enterprises, and help core companies reduce capital occupation. Up to now, the Qinge Blockchain has cooperated with many large financial institutions and listed companies. The main customers are: China Post Savings Bank, China Life Property & Casualty Insurance, etc. And a joint-stock company with A-share listed company Zhongzhuang Construction, using blockchain technology to transform the building decoration industry.

Fang Yushu, the founder of Yange Blockchain, was the editor-in-chief of Sina Finance and the editor-in-chief of Oriental Fortune. He has 15 years of experience in financial Internet operations and development, as well as management experience on Internet platforms and listed companies. Recently, Fang Yushu interviewed Babbitt and shared the background of the fundraising of the pigeon pigeon blockchain and what the blockchain can do under the current epidemic situation.

Babbitt: What do listed companies participate in this round of investment? How does Zhongzhuang Construction integrate its own business with the blockchain?

Fang Yushu:

The main thing that Luge Blockchain is doing is the system solution of blockchain in industrial finance. China Decoration has been our business partner before. In August 2019, China Decoration Construction issued an announcement saying that it would work with us to invest in blockchain technology to solve the industry's supply chain finance problems.

Taking the decoration industry as an example, the tooling is about 4 trillion yuan, and the home improvement is about 3 trillion yuan. The two together add up to 7 trillion yuan. Among them, 22 million are employed, and there are millions of SMEs. Difficult and expensive financing issues are common in the industry.

Taking tooling as an example, the construction team can sign a contract with the customer and can only get a 10% -20% down payment. Once the construction is started, the staff's salary and material costs must be paid by the construction party, and the account period is short or long. Maybe two months, long words may last up to one year. In this way, the pressure on the construction side is very great. However, it is difficult for them to obtain financing from financial institutions such as banks.

In layman's terms, the banking industry generally only serves Gao Fushuai's enterprises, such as state-owned enterprises, state-owned enterprises, and listed companies. It is difficult for most SMEs to get their loans. For example, one of our customers is an unlisted company. It can do 500 million yuan a year, but it can only borrow from banks to 3.8 million. In theory, it can do even a project. Not coming down.

The reason for this situation is that traditional financial institutions lack a sense of trust in small, medium and micro enterprises. In fact, in the face of a market of trillions of dollars, they also very much hope to enter.

For traditional financial institutions, there are two indicators of credit: willingness to repay and ability to repay. To analyze the repayment ability, the core is whether the loan company has sufficient cash flow to pay the bank's principal and interest. The methods used by banks in the past include the audit of financial statements and tax audits, but there is an important problem here. The past is centralized. The data in the financial statements is true and false, and there is no way to verify it. For this reason, traditional financial institutions basically look at the creditworthiness of lenders to do business, which greatly limits financing at the industrial end and reduces efficiency at the financial end.

We use blockchain technology to empower the industry, and deeply integrate technologies such as blockchain, big data, and the Internet of Things with industrial financial scenarios to build an "industry-technology-finance" iron triangle model. Through technological means, the core data of the industry's capital flow, information flow and logistics are connected in series, deposited on the distributed ledger of the alliance chain we build, turning the industry into data, and providing financial services for small, medium and micro enterprises.

The industrial alliance chain of the decoration industry we jointly created with China Decoration Construction has gathered financial institutions such as Ping An Bank, Industrial and Commercial Bank of China, Agricultural Bank of China, Pudong Development Bank, Minsheng Bank, Ningbo Bank, and government agencies such as Shenzhen Taxation Bureau to participate together Go to the alliance chain and become the bookkeeper of the alliance chain.

Each business data on the alliance chain has been confirmed by multiple parties. Taking SINOMACH as an example, if its upstream supplier generates financing needs, then the corresponding contract needs to be confirmed by the listed company, and the invoice will need to be taxed. The bureau checks the ticket, and then sends the corresponding information to the financial party (bank), and the bank can quickly review and approve the loan to the supplier.

Based on this thinking, as a core company, China National Construction started investigation in August 2019 to understand the demand of blockchain in supply chain finance. And in November 2019, an announcement was released, from the business level to the capital level, to become a shareholder of the pigeon chain.

In addition, the impact of this new crown epidemic will definitely cause a major blow, even a devastating blow, to most industries. Especially when the epidemic happens, in fact, a lot of pressure on accounts receivable will arise, and the application of blockchain for SME industry-side financing may be more robust. Based on this judgment, our round of financing was accelerated. Babbitt: What is the main use of funds for this financing?

Fang Yushu:

The financing plan has not been affected by the epidemic situation. This year, we will continue to expand and deepen mainly on the industrial side. We hope that more core enterprises and small and medium enterprises will enter our platform to solve their financing problems. Accordingly, we will invest more in research and development and marketing. We are also relatively fortunate. In the short to medium term, we don't have to worry about money, and we have sufficient funds to implement the established plan.

Babbitt: ABCD is currently the four most advanced technologies in science and technology. In the face of this epidemic, A (artificial intelligence), C (cloud computing) and D (big data) all have a role to play in solving the epidemic. Some problems, but we see that B (blockchain) did not play a role in the early stage. What do you think? What can the blockchain do for the epidemic? How to do it?

Fang Yushu:

We have been focusing on the financing of the supply chain at the industrial end. With the impact of the epidemic, more and more small and medium-sized enterprises are in hot water. Therefore, the application of the blockchain at the industrial end can increase efficiency faster, and make the original business that cannot be done. To make the original tedious or backward risk control and approval efficiency more efficient.

In addition to the decoration industry just mentioned, for the supply chain finance of the medical industry, we actually planned and deployed a few years ago, and cooperated with another listed company to develop a medical and medical device industrial financial blockchain platform. The impact of this epidemic on China as a whole is half a year to a year, so we may pay more attention to and participate in this industry for a longer period of time.

In addition, the application of blockchain to charitable donations is also a natural fit. We did not put it in a particularly urgent task this year, but during the Spring Festival, the Wuhan Red Cross Society created a new crisis of trust in the public welfare. Relevant civil affairs departments have found us and hope that we can use blockchain technology to solve it. We are currently working on a plan, which may be implemented on a trial basis. We are now ready to join the frontline of the epidemic! Babbitt: How has the epidemic affected you?

Fang Yushu:

I think this epidemic is really very sudden. I believe most people did not expect it to develop into such a passive situation. At this time, not only blockchain startups, but even large companies, it is indeed a test of our adaptability and timely adjustment and ability to adapt to the new situation.

Therefore, we have an emergency meeting to coordinate this financing at the time of the Chinese New Year. It is also our own timely deployment and adjustment for the new situation. In the last week, we have actually been working from home, and quickly adapted to this distributed office mode. The development work is progressing as scheduled. There are meetings every day, but it doesn't really affect us much. Babbitt: Your application is mainly to help small and medium enterprises from the perspective of supply chain. Then did you say that this epidemic means some specific means to help these small and medium enterprises financing?

Fang Yushu:

In fact, this is what we said before, mainly to solve the problem of difficult funding. These are all in our existing work and work plans. In fact, I think that for small and medium enterprises, how to survive such an epidemic situation? ?

Because the income of SMEs is now affected, at the same time, the cost of personnel and rent have not been reduced, including the accounts receivable just mentioned. At this time, the most powerful help that can save them is the support of funds. In fact, we also look forward to more policies from the government one after another, but the government is also under great pressure now, so as a force for marketization , we may not only It is a supplement. Maybe it will develop to the later stage. It is a main force. Babbitt: I noticed that blockchain startups often take money from listed companies. What do you think of this phenomenon?

Fang Yushu:

From our own one or two years of operation, we believe that the biggest value of blockchain in domestic applications should be to solve the problem of trust. In fact, now everyone has reached a consensus: on the one hand, the application of finance should be the most valuable, and the proportion is the highest. On the other hand, comparing private chains, public chains, and alliance chains, it should be said that the most feasible or effective now is the alliance chain.

So, in the application of the alliance chain, in addition to the technology itself, there is an important piece of operation, which may be a bit like the Internet.

It would be very difficult to run a technology company alone. Especially businesses like to B. Generally speaking, a listed company basically represents a leader in a subdivided field and has the right to speak in the industry it belongs to. The combination of technology and industry is more conducive to the application of blockchain technology. Otherwise, for example, in the past few years, the currency circle has made thousands of public chains around the world, but if no one uses the chain, it can only be an air tower.

On the other hand, listed companies represent traditional industries, hoping to seek new business growth points through technological innovation. The policy bonus of October last year also caused the concept of blockchain to become the hottest hot spot in the second half of last year. Naturally, Attention of listed companies. Babbitt: What plans do you have for 2020?

Fang Yushu:

We target several industries, such as automotive, decoration and decoration, as well as medical treatment, to deepen and expand. In response to this sudden epidemic, we are planning a blockchain solution. If feasible, it may become our important strategic plan.