1) Let's talk about the story of Youzan, an e-commerce back-end SaaS platform for omnichannel retail, implied market cap of $12.2Bn.
Their founder is legendary, high-school dropout turned artist turned Alipay PM turned founder.
Imo it's the Chinese Salesforce, not Shopify
Their founder is legendary, high-school dropout turned artist turned Alipay PM turned founder.
Imo it's the Chinese Salesforce, not Shopify
2) So while Youzan's founder is called Ning Zhu, he goes by the moniker White Crow (白鸦 aka Bai Ya). In homage to a parable where a white crow chooses freedom and starving to death over a lifetime of cushy cage-dwelling.
3) He grew up in the poorest county in Henan. After dropping out of secondary school, he worked a series of odd jobs, including peddling clothes and construction work but eventually returned to education and got a degree in art and design.
4) After a break-up in 2003, he got on a train to Beijing and vowed to work for six years as a web designer to see what would come out of it. The timing was right and he ended up working at Baidu before joining Alipay in '08. Working his way up to being the lead designer.
5) In 2011, with one failed startup behind him. He embarked on a new venture. A merchant CRM based on the newly established Wechat. The name was Pocket Tong (口袋通)
When WeChat's user count exploded in 2013, more merchants everyday wondered how to do business on the platform.
When WeChat's user count exploded in 2013, more merchants everyday wondered how to do business on the platform.
6) Then the unexpected happened, Alibaba blocked WeChat's links in Nov 2013. The fanbase that merchants had spent a year cultivating had no place to go to finish their purchase journey.
The team had an opportunity in front of them, and they took it.
The team had an opportunity in front of them, and they took it.
7) The way forward was an e-commerce platform that utilised the private and decentralised traffic of WeChat to transact. Youzan pivoted from merchant tooling to being a full-stack micro store.
8) Youzan is at the intersection of several Chinese tech trends right now; the rise of private traffic in e-commerce, getting Chinese enterprises to pay for software and how to own the funnel.
https://twitter.com/lillianmli/status/1367843215299276800
9) They follow the 'own the funnel' strategy after a crucial realisation. Chinese companies see making money as their core competence; this means improvements in efficiencies and cost reductions are nice-to-haves. Tools that increase revenue are need-to-have.
10) They are reluctant to pay for process optimisation but are willing to pay for positive outcomes. I believe every Chinese SaaS company encounters this mindset sooner or later, and the smart ones decide that they too need to make money and become revenue generation offerings.
11) With this ethos, Youzan's offering enables its merchants to be a one-stop-shop for their customers. 
12) In terms of what the product looks like. Storefront layout is relatively set and allows a certain degree of customisation. The layout takes heavy inspiration from Taobao (and I guess so does every other e-commerce platform).
13) While a general comparison for Youzan has been about how it's the Chinese equivalent of Shopify, upon closer examination, Youzan's product strategy is strikingly similar to Salesforce's. I think of Youzan being a CRM that commercialises through their e-commerce platform.
14) On the 28th of February, they made an announcement that they will be delisting from the Growth Enterprise Market of the Hong Kong Stock Exchange and have applied to be listed on the Main Board. It's getting ready for prime time, and I'm excited to see what it'll do
I wrote a 17-page deep-dive on Youzan for paid members if you're interested in digging further. lillianli.substack.com/p/youzan-deep-…
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