Wu Zhaoguo, Future Bazaar: Business Support for Ordinary People, Care for the less Privileged| iAsk Leaders
I believe the Future Bazaar will cast the light of business on all ordinary people.
——Wu Zhaoguo, Founder of Future Bazaar
In Huadu, Guangzhou, we met with the founder of Future Bazaar, Wu Zhaoguo, in its headquarter. The interview coincided with the same day of the Third E-commerce Networking Event by Future Bazaar and the first Entrepreneur Conference, being held in the Huadu Stadium. Micro-business owners of Future Bazaar from across the country traveled to Huadu for it.
Among them are a new mother from Yunnan with her two-year-old kid, a veteran traveling from Henan, some in wheelchairs, and some over fifty years old. They traveled all the way there for nothing but to meet Wu Zhaoguo in person.
What merits does the platform Future Bazaar have, making users willing to travel across the country? Which was the right move the founder Wu Zhaoguo has made to merit so much dedication. In this issue of iAsk Top Leaders, Gloria Ai, founder of iAsk, is interviewing with Wu Zhaoguo.
Who knows what bread and butter mean to ordinary people?
At the Third E-commerce Networking Event, the Future Bazaar is going live globally too. Wu barely rests for days to prepare for it. During our interview, even if it’s a small break, he would immediately jump back into work.
Wu mentioned that he has not slept well since 2014 when he started his business. Anxiety all alongside the journey. Now 1.5 million users are gazing at him with high expectation, he is concerned with how much bandwidth he has to keep creating value for them in the future.
Back in 2014 when he founded SIBU Group, he agglomerated fragmented productivity, enabling everyone with business and money, and hence becoming the champion building wealth in the new era. From an outsider's perspective, Wu and his SIBU Group illustrate the miracle in the networking e-commerce industry. It is widely acknowledged that the rise of SIBU Group is attributed to the name Wu Zhaoguo.
In the headquarter of the Future Bazaar, we can see his name and quotes he had once said almost on every floor. When being asked, however, he does not think his name means much to himself, but a lot to the vast grassroots entrepreneurs, whom figured Wu as a motivator to march ahead and the creator of the entrepreneurial platform.
Gloria Ai: Who are these grassroots entrepreneurs?
Wu: They can be mothers of toddlers, veterans, fresh college graduates, the disabled yearning for independence and so forth. They are all grassroots entrepreneurs.
Gloria Ai: What is Wu Zhaoguo leading them toward?
Wu: Entrepreneurship. For them, entrepreneurship is a means of make a living. They need to survive first before improving life quality.
Wu explained that he has been there and perfectly understands how hard life can be. From failing in the college entrance examination to failing at entrepreneurship several times, young Wu Zhaoguo who came from a small town experienced all the setbacks thoroughly during the first decade of his career. Having gone through all the trials and tribulations and having suffered humiliation and hardship, he understands better than anyone what ordinary people needs: hope and dignity.
At the start of the business, he only rented one floor. With the expansion of the business, the office space extended to the whole building. In addition to the hundreds of employees of his company, more than 2,000 dealers on the platform also work in the same space. And surprising enough, Wu never charged them for rent. "Unless I were to go broke, as long as I'm still capable, I would keep it for free."
Today's China is witnessing a revolution brought about by youth from small towns who are proactively engaged in entrepreneurship. They can form a new blue ocean market for the Chinese business. And what Wu works on is to provide them with a platform and help them grow and create value.
Who can forge ahead against questions?
The Future Bazaar is a brand-new iteration of Wu Zhaoguo’s business. Within 3 months from June 30, 2019, when the APP’s open beta was released, till present, 1.5 million paid users registered on the platform, with a GMV of RMB 1.5 billion.
On August 25, at the Third E-commerce Networking Event of Future Bazaar, we expected that the whole venue would be immersed in the joy of celebration. However, surprisingly, apologies went first in the opening remark. Wu and his team apologized for the limited bandwidth of Future Bazaar to keep up with exponential growth and for the less-than-optimal performance of technology, customer service and logistics pledging for more time.
What's even more surprising was that they candidly revealed their pains and shared with the audience the negative feedback and complaints they had received since the launch of the APP. And in the face of these issues, Wu said he would like to thank the media, peers and even competitors for the supervision from all walks of life, because this is the only way for the Future Bazaar to grow even faster.
On August 1, Wu released an open letter entitled "Staying Strong for You, Hanging in for Love". In this letter, he wrote, "I have been constantly questioned throughout my entrepreneurial career. Along the journey, I pulled through the bitterness of countless times of misunderstandings and the embarrassment of being defeated plentiful times. It is the determined belief in our business model that enabled me to persevere after bursting into tears; it is the faith in my team and products that empowered me to overcome obstacles one after another and keep striving.
Gloria Ai: Before today's interview, I did some research on the media coverage and comments about the Future Bazaar. Half of them are positive and the other half, negative – is it fair to say so?
Wu: Not just half. 90% of the comments are negative. They accused me of pyramid selling and questioned why I am not the legal representative of the Future Bazaar. Some even asked whether I’m planning to run away? I have been constantly attacked by these comments in the past three months. It was very severe.
Gloria Ai: If the Future Bazaar is not a pyramid scheme, how should would you define its commercial nature?
Wu: It's social e-commerce. The Future Bazaar adopts an extremely simple business model. It's not much different from the mainstream e-commerce. We just add an additional feature that helps you save money for personal use based on the model. If you go shopping on Tmall and spend RMB 100 yuan on an item, Tmall will reward a Taobao spreader with RMB 10 yuan of commission. Similarly, we use the 10-yuan as an incentive on our platform. The business model is just that simple, and it's universally adopted - not my original idea.
Wu shared with iAsk that Future Bazaar is a social e-commerce platform, which will serve a larger number of people with better supply chains and more optimized technologies. Through the impact to social groups and circles, quality products from around the world can be shared with every ordinary person around you, so that they can create and gain value on the platform.
From his perspective, social e-commerce consists of two forms, i.e. group buying versus referral. Future Bazaar represents the latter, where I can make money by the referral and in the meantime while you can save money because of my referral. The latter form certainly can encourage the purchase on the APP than the former. The market size for this sector is enormous.
Regardless of any segmented sector, the prevailing market view of the rise of e-commerce platforms is related with "money squandering". In the second quarter of this year, Pinduoduo's loss exceeded RMB 1 billion; Yunji lost over RMB 80 million in Q2; JD.com "burned" through over RMB 30 billion in the decade before making profits.
"We will not take the path of 'burning through money'. After all these years in the business, I don’t buy it when obtaining market shares by 'squandering money', which would very likely result in a business failure. One step at a time and then scale up my business steadily – that’s my goal." Wu has his own judgment on e-commerce.
Who can catch the users neglected by the mainstream e-commerce?
Gloria Ai: The small and micro-business owners gathered on the platform of Future Bazaar are scattered all over the world in real life. They may not be the mainstream force. Do you still think they are not negligible?
Wu: Yes, there are still numerous users who are neglected by mainstream e-commerce. A while ago, we hosted a local marketing event in Shandong. There was an auntie who only finished primary school. She didn’t use WeChat Pay and barely understood how to use WeChat. Our local salespersons taught her how to download, add cards, make payments and enter delivery address. They patiently spent a couple of hours walking them through the app. This user group is vital in my opinion. They're increment users. I won't be snatching users from mainstream e-commerce. Instead, I’m tapping potentials from increment users.
In the first half of 2019, China's total online retail sales reached RMB 19,520.9 billion, accounting for 24.7% of total retail sales of consumer goods. It is expected that by the end of 2019, the number of China's mobile e-commerce users will exceed 700 million. Even so, there are still a large number of consumers who have not yet been covered by the existing e-commerce platforms.
At present, the resident population of rural areas in China exceeds 560 million. If it's based on the cities below the third tier and rural areas in correspondence with the buzzword grassroot marketing, the population base is even larger.
Wu shared with us a true story that happened at Future Bazaar. He once met with a user who is a mother in the mountainous area of Yunnan. The mother only earned RMB 400-500 per month but was particularly grateful to him. He didn't understand why. Thus, he asked around and learned that the mother lost her first two babies due to malnutrition because she couldn't afford formula. Some RMB 400-500 per month through Future Bazaar would be sufficient to raise a child locally. So she was very content. The story makes our heart sink, but similar stories happen at Future Bazaar on a regular basis, according to Wu.
Perhaps this is his sense of mission: to help these unprivileged ordinary people.
The vast market of social e-commerce, hundreds of millions of increment users, coupled with Wu's dedicated work, contributed to the rise of Future Bazaar that the capital market cannot ignore. In 2018, he successively completed two rounds of financing from SAIF Partners and China Growth Capital. This year, he also completed the Series B+ financing. 360 Finance also joined as an investor.
Gloria Ai: I spoke with your investors, and they called you “an eccentric person, humble but wild at the same time”.
Wu: Humble in person, wild in business. I had to. This industry gives you no choice but to go wild. But now I’m trying to restrain myself too. In the past five years, we were not appreciated by mainstream consumers. In times like this the only thing we can do is to stand up and reassure them that we are excellent. We fight back in this way. Now sentiments from the state is changing after the policies are changed, and the way media views us is more of amity. We are also getting to be reserved.
Wu said people need to grow eventually. He himself and the user groups he is helping are growing together with society.
On August 8, the General Office of the State Council issued the "Guidelines on Promoting the Standardized and Sound Development of the Platform Economy", which clearly encourages developing new formats of the platform economy and facilitates "Internet + entrepreneurial innovation", so as to perfect the comprehensive entrepreneurial innovation service system via the Internet platform.
The platform economy is what Wu has been committed to. The underlying logic of Future Bazaar is to make the most out of the segmented productivity and reshape the existing relations of production. The business model of S2B2C pools merchants, shopkeepers and consumers on the same platform, eliminating all unnecessary losses and maximizing the interests of all parties, in order to form a new business format.
However, Wu also admitted that it's still not time to dwell on achievements yet. The team is striving hard step by step for the goal.
When we asked him how he envisioned Future Bazaar in the next decade, he responded: " I believe the Future Bazaar will cast the light of business on all ordinary people." As for his own future, he wishes to become an investor to empower and help more grassroots youth like him who came from have a rural background. "This is what I care about the most."
iAsk Media offers in-depth coverage, distribution, and brand-building services for founders in both China inbound and outbound markets. Over the past five years, iAsk Media has published over 1300 pieces of founder-focused original text and audio content, and produced over 120 premium video dialogues with leading entrepreneurs and investors.
iAsk Capital further supports founders by complementing media, brand-building, and marketing solutions with a wide range of investment and advisory services, from growth capital and direct equity investment to fundraising, asset management, and M&A support. To date, iAsk Capital has completed investments in some of China’s fastest growing ventures, including Bytedance, Himalaya, Movietime, and Horizon Robotics.
Gloria Ai is the founder of iAsk Media and the founding manager of iAsk Capital, and a former venture partner at the Softbank Asia Infrastructure Fund. She serves as the international brand ambassador to her hometown of Huangshan, and was Forbes 30 Under 30 in the Media, Marketing & Advertising category. She is a graduate of Harvard Kennedy School and Peking University. Prior to founding iAsk, she served as a financial news correspondent for China Central Television in New York.