zifang capital's investment puzzle: you have to pay a lot of money to be "invested", but the invested companies say they didn't get any money
2024-09-03
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recently, founders of several startups told red star capital that they had come into contact with an institution called "zifang capital", which required the startups to reimburse travel expenses, purchase accompanying products, etc., but was unable to provide corresponding resources and services.
the red star capital bureau’s investigation found that in the current primary investment and financing market, some people take advantage of entrepreneurs’ eagerness to raise funds and in turn extract more value from them.
1. investors who changed their names
wu shan (pseudonym) is the founder of an internet project startup company in sichuan province. he once posted information about his startup project on the jingzhun platform, hoping to attract investors to invest in the startup project.
public information shows that jingzhun is a financial technology service platform. on the jingzhun platform, users can choose any identity such as entrepreneur, investor or service agency for authentication.
wu shan recalled to the red star capital bureau that in 2023, a person named "peng hui" contacted him through the jingzhun app and expressed his investment intention. at that time, peng hui claimed to be from a venture capital institution with state-owned background.
wu shan said that due to the long time interval, the chat records between him and peng hui on the jingzhun app have disappeared, but he can still see peng hui's homepage now.
image provided by the interviewee
"we chatted (online) for more than a month. no matter what we said, the other party just said, 'your project is good.' then they said they wanted to come for an on-site inspection. we had to pay for all the travel expenses, which cost more than 9,000 yuan. they also asked us to prepare local specialties." wu shan told the red star capital bureau.
wu shan said that after the two sides met and communicated, "i talked to him (peng hui) about some deeper topics, but he couldn't say anything."
wu shan recalled that after the field investigation, peng hui said that he could invest in their entrepreneurial project, but the prerequisite was that wu shan found a follow-up investment institution, and it needed to be a follow-up investment institution recognized by them, but he did not clearly give the criteria for recognition.
after that, peng hui invited wu shan to participate in the training courses and activities they launched for entrepreneurs, but wu shan refused. "i felt that they were trying to trick me, so i didn't go."
among them, peng hui once sent wu shan an invitation poster for an event. wu shan discovered that in this poster, peng hui's face was still peng hui, but his name had changed to "wang xianliang", and the institution he belonged to had also become zifang capital.
image provided by the interviewee
wu shan told red star capital, "i went to ask peng hui, 'did you make a mistake with your name? why is it wang xianliang?' he explained that peng hui is his mother's name, and he should use his father's name in public. isn't this ridiculous?"
it is worth mentioning that the event that peng hui (wang xianliang) invited wu shan to participate in required a participation fee of 980 yuan to support the costs of venue, materials, tea breaks, etc.
2. account balance exceeding rmb 2 billion
zhang kai (pseudonym) is the founder of a startup company in guangdong province. because they had a financing plan, they announced the project-related information on the jingzhun platform. then, a person named "qin hong" contacted zhang kai through the platform and claimed to be interested in the project.
according to zhang kai's recollection, qin hong claimed to be a shareholder of zifang capital, and that zifang capital was paying attention to the track in which zhang kai's entrepreneurial project was located.
tianyancha app shows that the main company of zifang capital is guangdong southern zifang investment group co., ltd. (hereinafter referred to as "zifang capital"). among them, chairman wang xianliang holds 43% of the shares, and vice chairman qin hong holds 5% of the shares.
shareholder information of zifang capital, screenshot from tianyancha
out of curiosity, zhang kai looked up zifang capital online and found that many startups invested by this institution this year were in the same track as theirs. "because not many institutions paid attention to our track this year, i took the initiative to contact qin hong."
after getting in touch with zifang capital, zhang kai was invited to attend an event and paid a participation fee of 980 yuan.
"in fact, i have come into contact with more than a hundred venture capital institutions and am quite familiar with the venture capital circle. it is rare for me to see participants being asked to pay tea fees, but this amount is indeed not high. we thought that 980 yuan might be one more opportunity for us," said zhang kai.
at this event, zhang kai met wang xianliang.
he recalled that when wang xianliang was speaking, no matter what he said, there were always a few people in the audience who applauded, and he would say something like "give the applause to yourselves", and each time there would be exciting music.
image courtesy of the public account "mainland zifang capital"
what made zhang kai feel that this was different from other activities was that during the event, when two audience members questioned wang xianliang's lack of financial strength and connections, wang xianliang would throw out strong "evidence" to slap the other party in the face.
zhang kai said that after being questioned, wang xianliang showed the balance of his company's account on the spot, which was more than 2 billion yuan, and proved the authenticity through the real-time transfer of digital changes. in addition, wang xianliang also showed his address book, which included many political and business figures.
zhang kai also told red star capital that during the event, wang xianliang launched a range of companion service products from 29,800 yuan to 1.98 million yuan. among them, the 1.98 million yuan product will provide various resources for the startup company and accompany it for a long time until the startup company goes public.
3. what can you buy with money?
zhao wen (pseudonym), an entrepreneur from guangdong province, paid for the running-along service product from zifang capital.
zhao wen told red star capital that after an event, he had a private communication with wang xianliang. after a brief introduction of the project and a question-and-answer session, wang xianliang claimed that he could lead the investment in their entrepreneurial project and provide some resources.
"he asked us to find another institution to follow up with the investment, and then he would transfer the funds to us. at this point, he said he was in a hurry and had to fly to a certain place soon. if we were interested in being invested in, we could buy their 29,800 yuan accompanying service product and then talk about it," said zhao wen.
zhao wen acted decisively and paid 29,800 yuan to purchase zifang capital's accompanying product service, and the two parties signed the contract immediately.
recalling the situation at that time, zhao wen told red star capital bureau, "we later felt that this decision was a bit hasty and different from the normal one, but at that time many things were crowded together, which forced you to make a decision at that time."
the contract provided by zhao wen shows that zifang capital provides them with five specific services (there are grammatical errors in the original text, which have been modified below):1. online consultation on corporate investment and financing matters;2. help connect with 10 investment institutions;3. wang xianliang’s private phone and wechat provided micro-consultation. the founder of zifang capital took a group photo to endorse the project and provided private hotline consultants to integrate resources and link zifang capital.4. endorsing the company and serving as a partner;5. organize offline participation in zifang capital’s dinner club.
image provided by the interviewee
zhao wen told the red star capital bureau that after the two parties had signed the contract and the funds had not yet arrived, wang xianliang claimed that he could announce to the public that zifang capital had invested several million yuan in their project, which made him feel unreliable.
"wang xianliang said that this (announcement to the public) would increase the exposure of our project, and more investment institutions would be interested in us in the future. but this also made us alert. it was easy for me to think: is there such a situation in the cases that zifang capital claimed to have invested in?" zhao wen told the red star capital bureau.
wu shan has never purchased zifang capital's running-along service product, but he told red star capital that the current investment and financing market is relatively chaotic, and paid running-along is a common routine. he has experienced it personally, but the other party was not zifang capital.
“they say they can help you find investment institutions, and once you hand over the money, they may just find a few people to come and say your project is not good. i have even personally experienced even worse situations: they call you at six o’clock tonight and ask you to go to singapore to meet with investors at nine o’clock tomorrow morning. how is that possible? in the end they will say that it is you who did not cooperate,” wu shan told the red star capital bureau.
4.has zifang capital invested money?
the red star capital bureau noticed that among the entrepreneurs interviewed, two of them were connected with zifang capital through the jingzhun platform.
the jingzhun platform shows that users need to fill in their name, wechat id, mobile phone number, investment preferences and position information for investor identity authentication. if they are individual investors, they only need to fill in their email address; if they are institutional investors, they need to fill in the name of the institution, position and email address. after filling in the information and uploading the business card, the platform will review it.
jingzhun’s customer service told the red star capital bureau that they would conduct a multi-dimensional manual review, such as whether the institution’s business scope includes investment, whether there are any investment cases, and corporate email authentication (if there is no corporate email, then determine whether the paper business card is authentic).
when red star capital bureau asked whether this review method would have "slippery fish", the customer service representative said, "maybe. we have to review a large number of investors every day. if there are problems later, for example, if entrepreneurs come to give feedback or complain, we will cancel the (certification) identity if we encounter such problems."
in addition, the red star capital bureau found through search engine inquiries that there are many articles claiming that zifang capital invested in startups, with investment amounts ranging from 5 million to 10 million yuan, mostly angel round financing, and the news came from websites such as yiou.com and donews.
screenshot from baidu search page
in early july, the red star capital bureau called several companies that had received investments from zifang capital in the above news. after the reporter stated his purpose, the relevant persons in charge of some of the companies directly hung up the phone. the relevant person in charge of another company, fuzhou jingyin intelligent technology co., ltd. (hereinafter referred to as "jingyin intelligent"), disclosed the situation to the red star capital bureau.
at the end of march, zifang capital posted on its official account "mainland zifang capital" that it had made a strategic investment of 9 million yuan in jingyin intelligence.
screenshot from the public account "mainland zifang capital"
on july 3, the red star capital bureau called the mobile phone number disclosed by jingyin intelligence in the industrial and commercial channels. the other party said that he was the founder of jingyin intelligence. at present, they have not yet received funds from zifang capital, because there are prerequisites for the arrival of funds, which requires their user volume to reach a certain number.
the person in charge also said that he met wang xianliang at a roadshow event. "he (referring to wang xianliang) meant to release (the investment news) first, so that we can get that exposure and see how the market reacts. if it succeeds, they can invest first."
on september 2, the red star capital bureau called jingyin intelligence again, and the person in charge said that as of now, it has not received investment funds from zifang capital.
5.who is wang xianliang?
according to the official account of zifang capital, wang xianliang's ancestral home is in shaoyang, hunan. he started from scratch and now holds many titles. in the past year, the team behind him has resources all over the world, leading and guiding more than 400 small and medium-sized enterprises in the country to go public, and his team manages more than 50 funds.
however, the red star capital bureau searched the official website of the asset management association of china and failed to find any relevant member institutions of zifang capital.
on july 23, the red star capital bureau called the private equity fund consultation hotline disclosed on the official website of the asset management association of china as an investor. the staff who answered the phone said that all fund managers need to register. if the information cannot be found, it means that they are not qualified to conduct fund-related business.
image courtesy of the official website of the asset management association of china
the red star capital bureau obtained wang xianliang’s mobile phone number and other contact information from the interviewed entrepreneurs.
on july 5, the red star capital bureau called the mobile phone number, but the person who answered the phone said that he was wang xianliang's younger brother and that this mobile phone number had been used by wang xianliang before. at the same time, he provided the red star capital bureau with the mobile phone number that wang xianliang was currently using.
on july 5 and 6, the red star capital bureau called the mobile phone number provided by "wang xianliang's brother" several times, but no one answered. on july 9, the red star capital bureau called the number, and the person who answered the phone said that this was the phone number he had just registered, and "(you) dialed the wrong number." on september 2, the red star capital bureau called the mobile phone number again, but no one answered.
in addition, "brother wang xianliang" explained some issues to the red star capital bureau.
regarding wang xianliang's use of the name "peng hui", "wang xianliang's younger brother" said that this is wang xianliang's mother's surname, and his mother's surname is peng.
when red star capital asked why some of the invested companies did not receive funds from zifang capital, he said, "you should read the text carefully. some are strategic investments. strategic investments may not include funds. for example, they give you some resources, which can be converted into one yuan or ten million yuan."
as for the information that zifang capital claimed on its official account that it "led and guided more than 400 small and medium-sized enterprises across the country to go public", he said, "this was invested and managed by the team behind him, not by him."
regarding more detailed questions, "wang xianliang's younger brother" said he was not sure and said he would convey the reporter's interview intention to wang xianliang.
on july 5, the red star capital bureau sent an interview letter to wang xianliang’s mobile phone number and zifang capital’s email address. as of press time, no response has been received.
red star news reporter yang peiwen
editor: deng lingyao
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