Why It's So Important for e-Commerce to Keep Growing
Why It’s So Important for e-Commerce to Keep Growing GGV Capital’s Hans Tung explains.
It's great to be here, I think is my fifth conference now. Um and we'd see a lot of friends here. Um, I moved to China in 2005 thinking, Now we'll go there, be a semiconductor investor and quickly realized that Wow, it is a very different market. Seven. Conductor is a tough market company business. Um, this Tony's Europeans, Americans, comportment everybody can think of are there. But it's a little thing called Internet. Seem to be going pretty fast and a lot of users on it there no way to monetize it. But hey, who knows? Overtime. Maybe somebody will figure something out. It was with that inside the hay over time. This may be the easiest place, but going online, you build a national business. A country of 1.3 billion people were under communist rule, very difficult skill offline. But being online, everything seems faster and ends up being easier, not inside. Help me to end up where I am today by being a lot investment both in the U. S. And also emerging markets were white. Why is a matter for the next 1,000,000,000 users a ton of stuff to do in New York stuff doing silica. Matty. America's a great place. The best we've been tumbling to Seattle L. A. To give in parts of East Coast in the body alone is booming. However, we look at the statistics 10 years ago when Ali Baba first chemo and first lunching e commerce Ingham or major fashion they start a single stay promotion on November 11. You're all alone in Chinese Double 11. You don't have any any date. You're by yourself kind of loser. So what do you shop here? Because l feel better. So that's how they start a promotion. $8 million sales happened today Quickly. 10 years later, you goodbye, 4000 AKs 2 31 billion. And obviously the group is have a trillion dollar company listed in New York the same time in the U. S. Promotion. So group you look a cyber Monday in Black Friday over that during a period to come by myself, all the group for axe. But what's in this thing? And you look at what was happening in China Internet space. Some point user only doubled. Yet the world changed because they believe I used to do things online going Online seems like the best way to skill business, even in control oriented Communist Party. I'm just here with five facts that kind of helpless to think through why we're excited to find out where the next gun users we look at user growth, Internet on a worldwide basis, a lot of girls coming from smartphone, and we look at what a smartphone users air coming from three places send out over the next three years from 2018 to 2021. We're expecting 750 million new net ass off Smart User's smartphone Users in 2000 are in three places. India Last 10 mostly in Brazil in a visa wouldn't have been the biggest market that's actually about eight or nine cities. Is some Pollo. It's Bogota. It's Mexico City, Zakarneh. It's bangle or New Delhi. So obviously you tell. My travel schedule under Lisa's place is quite a bit. Many of these users are coming online, are very young, almost have home. We low under 24 years in age. All of us have kids. Many of us have kids, and we want to see my daughter and my son. One is seven year old ones 11 year old and every singly they see the Ottoman want to touch it and moving. They grew up on iPad, the grub listening and to qualify. They grew up looking at shows on YouTube. They have more time YouTube than all of TV time ever spent in my life. It's amazing how digitally native, the users are still ears used to trying new things. And we'll look at China. One lesson we learn on the job title vice chairman about about my mentioned this as well. Back in 2009 he noticed that keeping people capital for China would sit around $4000 on a current dollar basis. So nominal not P P. P. And since then incomers took off. And back then it was only one year, according China. And that was, uh, you look at some of the other countries Indonesia, Brazil, India, where the most user coming from you look that GDP per capita. There's a slice of the population that has that Indonesia 264 million people, total average GDP per capita. It's just around $4000 for Brazil, obviously have been up and down, but it's even copper is relatively high on a global basis for India, about half a 1,000,000,000 people, the average of that is about 4000 per capita. This is why these country, despite some of the early bubble, that people are seeing people still feeling a long run. There's gonna be a lot, of course ahead. This is the funding for 2018 forties places we love New York. We spent a lot of time in New York. Newer has 20 unicorns. Yet you look at some of these other emerging markets where the next going use is coming from. They're still actually underinvested you. Look at India already 19 unicorn with half a 1,000,000,000 people averaging $4000 U. S. GDP per capita vs China sink deeper capita for 1.2 billion people. Only one in the corner, you can say argue India is definitely inflated. And there's a bubble, however everything what could be in the future? China has about 100 50 unicorns right now and everything that in 10 years India could be 40% of China that still 70 and 70 unicorn that could be made still plenty of growth ahead for the country. A dating life of users. We pull users in these regions, and it's amazing to see all the things that they want. This solved more than one to do look over similar to each other. Everybody has that kind of mind body out to go to the right, sharing app for commuting their mobile payment so they see a lot of busy locals. But you look more closely when it comes from, or messaging entertainment, pop culture or more broader, thinner app. You see a lot of Absalom us dominate with by dense and thick cock. The only exception. Look at the individual verticals. You start seeing a lot more local players emerging. But look, adaptation, even even though the philosophy are very similar across the table looking for delivery, there's obviously there's, uh, overeat and Gord Ash here in the U. S. You look a TTE India. You see Ziggy and tomato in Brazil. You see, I food going out again. Happy in Indonesia, you see grab and go job going at it with enough funding, and people have gone through the history of what happened, how we happened in China and us. You do see pattern emerging. You see someone will be being played out. It seems the similar behavior happen as the VC, we try to share what we know and help people avoid excess and try to figure out how to get to a Maur, equilibrium or control of Eastern sooner and faster. I'm putting the story of 500 the commonality among these that these are the people that building the next generation cos that's already a $1,000,000,000 valuation serving the next 1,000,000,000 users often come from very different backgrounds. Laki, the Distant Player automated in Brazil, sung by gentlemen Who's from Friends live in Brazil for 10 years, had a first are about look more like the uber of that time couldn't raise money, had a full did that end up in the 2nd 1 Now recently, in our evaluation, we're lucky to be an investor. Softbank put most of the money to get into a war. There are right now, but when you're inside their warehouse, seeing everything automated with machinery coming from India coming from China, coming from Germany is extreme impressive. Not only will we impressed by what has gone through in his second start up and therefore bet on him his comments on the machinery he used after helping make the second best in China in B plus because, he said, off every machine that he has tested was one that had a best value. Performers. It's cheap, like the Indian product, but performs a consumer product. So it's very easy for us to realize that Hey, we only do investment in China. This becomes very easy. Local play, only a local market but in reality is a global play. So by having more data, points it helping to see more media wouldn't be rewarding English When Lydia from med um, Andi learned and practiced get better. He come from a small town and end up building a company that number one e commerce in Indonesia. You look a soppy songs came from Kenji in China. I was fortunate to get stem for Jesse for MBA 10 years ago. End up going to Singapore. Thereafter buildup to startups Carina and Choppy that has a mark on my mark. Out of 14 billion you look the founders of who done their first start up the all from I T network. First off that was put card. They learn and struggles of the working, getting wood for the part and then the lessons. Now they're building the fastest business e commerce player in India. It is extremely inspirational for some of them go to their office and to see that it's raw in the air come from poor backgrounds. But they have so much that I have learned that Lumen to share and change the world for us. A VC, just like the panels before me were so fortunate to be part of their journey. Thank you.