A few days ago, together with Yanda, I visited Xin Zong of Honggu Capital, who used to be the managing director of Chengding Investment, pulling Chengding from 200 million to 11 billion, with rich experience in capital market and investment.
Honggu Capital is a fund established by Xin Zong after he left Chengding. At present, the first phase has a scale of more than one billion yuan, with a period of about four to five years. It mainly invests in catering brands, thus extending the upstream and downstream opportunities of catering industry. Honggu has a strong team of partners, including Ajisen, Babela and the founders of Green Tea, all of whom are partners of Honggu, so they may be regarded as one of the few professional catering investment funds in China.
As far as the investment logic of the catering industry is concerned, Mr. Xin believes that: First, the market is very large and there are many catering enterprises. There may be tens of thousands in Shanghai alone, so there is no need to worry about the small market; Second, the market is very chaotic and the competition is fierce; Therefore, there are opportunities, but it is not easy to make a mature restaurant brand.
In judging specific projects, Xin always mentioned several points:
A good catering project should recover the cost in a single store within one year, so that such a project has investment value; If we can achieve this result, it is relatively acceptable to rely on rolling development to achieve double annual growth even without financing
It is more valuable to achieve the first place in the subdivision category, because the market is large, even if the subdivision category will have a big market; However, we must worry that some brands will fall off quickly, and there are already many cases in this area;
The development trend of large-scale standardization to serve chain catering is very obvious, and it is also the future development direction of catering, which is beyond doubt
For the number of restaurants, it is also possible to seize the opportunity and get on quickly, but if you need a solid internal strength, you may have a sudden explosion point. As far as the relationship between quantity and valuation is concerned, it is possible to talk about a valuation of 100 million to 200 million in more than 30 stores;
A very important problem of investment in catering industry is exit, because in the past, the exit of capital market in catering industry was not smooth, so it is hoped that the project can at least earn back the principal within 3 to 4 years, which is safer for the fund. Of course, it is possible for the New Third Board, including the main board, to realize the exit of catering, including being acquired, which is also a good exit idea.