"It is a sad thing to have so many ideas and so much information with no one to share them with." During his days and nights pursuing an MBA at Harvard, Lin Yaocheng was immersed in various case analyses, with numerous ideas emerging in his mind but struggling to find someone to share them with.
In 2007, Lin Yaocheng brought in his friend Mai Gang, who was an investor, and the two hit it off, investing 10.24 million to establish DouDing (DouDing.com). At that time, they might not have anticipated that 17 years later, DouDing, with 240 million users, would be sold for a price of 1 million yuan.
Recently, the shareholder of DouDing, Beijing New Future Technology Co., Ltd. (hereinafter referred to as "New Future"), announced on the New Third Board that the company will sell its 100% equity in DouDing Century (Beijing) Network Technology Co., Ltd. (hereinafter referred to as "DouDing Century") to Youyou Whale (Beijing) Network Technology Co., Ltd. and natural person Yan Xiaojing for a price of 1 million yuan.
Why is DouDing, once extremely popular, now being "sold off" at a mere 10% of its value?
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In its heyday, DouDing was a platform that attracted a lot of attention and had a significant user base. However, the reasons for its current situation could be multifaceted, including changes in market dynamics, competition from other platforms, or shifts in user preferences. Without more specific information, it's difficult to pinpoint the exact reasons for its decline in value. It's also important to note that the sale price might not necessarily reflect the platform's true value but could be influenced by various factors such as the financial status of the buyer, the seller's urgency to sell, or strategic considerations.During his pursuit of a master's degree at Stanford University, Yaocheng Lin embarked on his entrepreneurial journey. His first venture was the IT compensation and human resources platform Skillsvillage, which quickly rose to prominence in the American IT human resources sector and was eventually acquired by Ren Corporation for a substantial sum of $32 million (Ren Corporation was later merged into Oracle Corporation). This venture gave Lin his first taste of success.
After completing his master's studies at Stanford, Lin continued his academic pursuits by enrolling in an MBA program at Harvard Business School. During his time as a student, China's internet industry was experiencing an unprecedented period of rapid growth, with a sharp increase in the number of internet users. By the end of 2005, the scale of Chinese internet users had grown to 111 million, an increase of 17 million from the previous year.
At the same time, Lin keenly observed that despite the unprecedented development of domestic internet technology, a vast amount of learning resources were still stored in paper form in libraries and archives. With the general improvement of educational levels, the demand for various documents such as textbooks, courseware, research reports, and academic papers was surging. Lin quickly targeted the field of online document sharing.
Inspired by the well-known American online document sharing platform Scribd, Lin founded Docin in 2008, officially starting his journey in China's internet entrepreneurship. As a pioneer in this field, Scribd's successful C2C (consumer-to-consumer) document sharing model provided valuable experience and reference for Docin.
However, compared to the highly mature C2C e-commerce models like Taobao in the Chinese market at that time, the document sharing field was still relatively weak, lacking a comprehensive platform like Scribd. Although as early as 2005, "Document Submission for Earnings Network" had pioneered a new model of document creation, submission, and revenue sharing, it failed to successfully build a complete C2C transaction loop and a robust profit path.Douding Network has innovated and developed on this basis, constructing a diversified profit model, which mainly includes five major segments: document transaction revenue sharing, advertising income, membership system, subscription services, and mobile digital reading charges. Among them, the document sharing platform service and media advertising service constitute its main sources of income.
On Douding Network, documents are divided into free and paid categories. Free documents are used to attract users, increase user volume and page views, thereby creating advertising opportunities for the platform. The price of paid documents is set by the uploader themselves, and there is an incentive mechanism: a document viewed can earn 0.01 yuan, and a document downloaded can earn 50% of the document's set price. This mechanism was very effective in motivating uploaders at the time, resulting in Douding Network surpassing 600,000 document uploads per day in 2017.
In addition, Douding Network has introduced a unique marketing resale mechanism, using API technology to allow users to share and resell documents through personal homepages, forums, emails, and other channels. After a document is successfully resold, the reseller can also receive a corresponding share of the profits. This efficient dissemination method further stimulates users' enthusiasm for use.
In 2010, Douding Network had 30 million registered users, which was equivalent to one out of every 13 Chinese netizens being its user. This achievement also helped Douding Network successfully enter the top 500 of the global Internet.
With the continuous expansion of the user base, Douding Network has become a "hot cake" in the eyes of many advertisers. It has successfully attracted long-term cooperation from many well-known advertising alliances, including Baidu and Sogou, through patch ads and pop-up ads. Between 2014 and 2015, Douding Network's advertising revenue was almost equal to its document sales revenue.As time progressed to the beginning of 2017, DouDing Network had evolved into a vast knowledge base with over 400 million Chinese documents, and its registered user base had surpassed the significant milestone of 150 million. Its business ecosystem was well-established, encompassing hundreds of categories of documents across various fields, and it had also developed vertical content aggregation channels such as Dou Lists and Special Topics. During this period, DouDing Network officially went public on the New Third Board Market, becoming the first stock associated with "knowledge sharing."
Entering 2019, the revenue of New Future (the parent company of DouDing Network) reached a new high, amounting to 47.84 million yuan, with document service revenue accounting for as much as 73%. Despite facing fierce competition from strong rivals like Baidu Wenku and Doc88, DouDing Network maintained a leading position in both the number of documents and user scale, securely holding the top spot in the industry. By 2022, both the user base and the number of documents on DouDing Network had reached unprecedented heights: the registered user count soared to 240 million, and the number of documents exceeded 800 million.
The decline of DouDing Network is inextricably linked to its arch-rival, Baidu Wenku.
After launching in 2009, Baidu Wenku quickly achieved seamless integration of resources, leveraging the user base of Baidu Search, a powerful engine. When users search for information on Baidu, the search engine prioritizes displaying its own products, including content from Baidu Wenku, which can be described as "a big tree provides good shade." The traffic resources of Baidu Wenku were far beyond the reach of DouDing Network.In terms of user experience, Baidu Wenku also does a better job. Compared with Docin, Baidu Wenku not only provides a large number of documents for free reading, but also introduces a model of download currency and points, providing users with more diversified ways to obtain them. Users can accumulate points by simply signing in daily, uploading documents, or participating in platform activities, and then redeem these points for download currency. This model effectively enhances user stickiness and promotes the sharing and dissemination of documents.
In contrast, downloading documents on Docin usually requires the purchase of Docin currency, and there are restrictions such as the inability to copy text during reading, which to some extent affects the user experience.
In the competition of the mobile app market, Baidu Wenku also took the lead. As early as 2010, Baidu launched the Baidu Wenku mobile app, while Docin only launched its app, Docin Study, in the following year, 2011. Although emerging applications like WeChat were just starting at that time, Docin's performance on the mobile side was not satisfactory.
The development of Docin Study on the mobile side seemed to be just to complete a task, simply piling up the website content "in a basket" onto the app.User feedback is rife with complaints about crashes, lag, missing features (such as the lack of categorized folders for document collections), and content mismatches (where titles do not match the content). These issues are all too common on the APP Store's message boards and have negatively impacted the overall rating of the app.
More critically, Douban Study's positioning is vague, and its content layout lacks verticalization. It mixes professional documents, various novels, and educational exercises together, resulting in a platform content that is "comprehensive but lacks distinctive features," making it difficult to form a competitive edge.
Users seeking professional document materials may be distracted by the temptation of novels within the platform, unable to efficiently obtain the required information. User feedback on the APP Store pointedly highlights this issue: "Mixing novels with knowledge-based documents not only increases the difficulty for users to find the information they need, but also places temptation alongside studies. For users with weak self-control, it is undoubtedly a potential lethal weapon."
For users who love reading novels, they tend to choose apps like QQ Reading and Shuqi Novels, which are focused on providing a novel reading experience. These apps not only have richer reading resources but also continuously optimize the reading experience. Douban Study has clearly not kept up in this regard, as it has not yet launched a night reading mode.
Douban Study is facing the dilemma of users being continuously diverted by the iteration and evolution of various vertical field apps. Its own content categories are too diverse, making it seem very overwhelmed, like a giant staggering on its feet, only able to watch helplessly as users are attracted to more focused and efficient competitors.In the field of education, this phenomenon is particularly evident. Once, when students were searching for exam questions, Docin was one of their important choices. However, with the rise of photo-based question search functions around 2015, applications like Xiaoyuan Search Questions quickly attracted a large number of student users with their simple operations of taking photos and obtaining answers. In contrast, Docin's method of requiring users to input complex text and formulas, and then navigating to a specific page of the document library, was not only cumbersome but also unable to provide instant answers, gradually losing the favor of student users.
For mobile users who pursue efficiency and convenience, the lack of a clear positioning for Docin's reading room has made it just another ordinary option among many document management and e-book reading applications, eventually getting lost in the app stores.
Moreover, Docin's business model has faced significant challenges in terms of copyright issues. Under the C2C model, the copyright ownership of user-uploaded content is ambiguous, and the platform shares profits with the uploaders while neglecting the rights of copyright holders, leading to frequent legal disputes. According to data from Qichacha, in the last decade, there have been as many as 475 legal cases related to the main body of Docin, with 75% of them being the defendant, mainly involving copyright infringement and online transmission rights of works. This not only damages the company's reputation but also increases operational costs. For instance, in 2015, a copyright infringement case between the Electronic Industry Press and Docin directly resulted in Docin being forced to pay 209,000 yuan.
Why the low sale price?
In the fierce competition of the document sharing field, platforms such as Original Power (formerly known as Document Submission Earning Network), Doc88, Baidu Wenku, and Docin are still competing, but their situations are vastly different.Despite the fact that the original force was born as early as 2005, it seems to have never truly experienced a moment of glory, and DaoKeBaBa is facing a similar situation. Both hold a place in the market, but they are not outstanding.
The one that has fared the best is the "rich second generation" Baidu Wenku, which, with the strong brand and resource support behind it, can always easily obtain the required resources and securely occupy the forefront of the industry.
Especially against the backdrop of the rapid development of AIGC technology, the way content is generated has undergone revolutionary changes. Users are more inclined to use AI tools to assist in creation or directly generate the content they need. Last year, Baidu Wenku embedded its own "Wenxin Yiyan" large model, transforming itself into an AI content acquisition and creation platform. This move not only left competitors far behind but also represented a dimensional attack on the traditional document sharing model.
However, it is puzzling that, although all document sharing platforms have been affected by the impact of AIGC technology, why did DouDing Net end up in the tragic situation of being sold at a low price of 1 million? The key to this lies in the financial situation of DouDing Net itself.
The financial situation of DouDing Net can be described as deteriorating. The two main pillars of DouDing Net's profits have both shrunk significantly. Advertising revenue has been declining year after year since 2020, and by 2023 it had plummeted to 1.46 million yuan, a sharp decline of 76.5% compared to the previous year's 6.2033 million yuan. At the same time, document sales revenue was also not spared, dropping from 34.92 million yuan in 2021 to 16.504 million yuan in 2023, more than halving.Facing such a predicament, New Future, the parent company of DouDing, had intended to sell DouDing in 2021 to alleviate financial burdens. According to the company's annual report, it had planned to sell all of DouDing's shares for 1.4 million yuan, but the sale did not proceed due to shareholder opposition. However, as the market environment continued to deteriorate and the company's financial situation became increasingly dire, New Future eventually sold DouDing for 100 yuan and decided to adjust its strategic direction, abandoning the document-sharing service as its main business, and instead seeking business transformation or capital injection to revitalize its operations.
After divesting DouDing, New Future's future business direction may shift towards a startup incubator. This decision is related to the background of its actual controller, Mai Gang, who, as an angel investor and the founder/CEO of the Startup Workshop, possesses abundant resources for startup incubation.
Data shows that New Future's revenue has been on a continuous decline in recent years, falling to its lowest point in recent years of 17.965 million yuan in 2023, a year-on-year decrease of 44.4%.
For New Future, the current situation is akin to a clay Bodhisattva crossing a river, struggling to protect itself. Dropping the burden and seeking new growth points may be its only way out.