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http://www.forbeschina.com/review/201509/0045110.shtml
In the 80’s of the last century, Jiang Xipei come from a common farmer family of Fandao Township, Yixing City participated in the college entrance examination, and was failed. He given up the opportunity of being in school again in spite of his parents' opposition, followed his second elder brother Jiang Hongpei to Hangzhou to be a clockmaker, and mastered all skills of clock mending within only 56 days. Jiang Xipei earned the first pot of gold—50,000 Yuan in his life within less than one year and became one of rare 10,000-yuan households in his town. “Clockmaker is still the best embodiment of the spirit of craftsman till now, and I believe that the requirements of few instruments are stricter than that of clocks.” Jiang Xipei still believes that the spirit of craftsman has large influence on his management and enterprise development in the future.
‘Before I learn clock mending, my willing is to be able to earn 50,000 Yuan and then marry a beautiful and virtuous wife, return home and build two rooms, and save the rest money in the bank to accrue interest’. Jiang Xipei frankly told his early pure idea of becoming rich to the outside world more than once. However, after rapidly earning 50,000 Yuan, Jiang Xipei found that his wealth creativity ability was far from being developed. In 1985, Jiang Xipei, with saved 250,000 Yuan from clock mending, went back to Yixing City to create an instrument and meter factory. However, the choice was not as fortunate as the beginning. Jiang Xipei lost 500,000 Yuan in three years because of the deficiency of equipment and technical personnel, and moreover, he was heavily in debt.
When Jiang Xipei was beyond hope, his eldest brother Jiang Genpei who was a director of Shanghai Office of a famous local enterprise suggested that the market requirements of cables in Jiangsu and Shanghai were strong, the profit margin was high, and cables could be dealed. Jiang Xipei keenly sensed the business opportunity and decided to have a try, and he borrowed 150,000 Yuan and began to do wire and cable business. In the years when means of production was planned to supply, Jiang Xipei utilized time difference, information difference and price difference, resold cables purchased from Zhejiang and Anhui Provinces to Shanghai City and Jiangsu Province, and he not only paid off the debt but also earned 1,000,000 Yuan within less than two years.
In 1990, Jiang Xipei raised funds 1,800,000 Yuan by himself to found a family workshop type enterprise “Fandao electrical plastics factory” comprising 28 members, that was the predecessor of Far East Holding Group Co., Ltd. “Being different from state-owned enterprises doing great investment at the time, we firstly found customers and then produced cables”, Jiang Xipei remembered. Far East was spectacular in development speed, and the revenue was doubled in successive years: the revenue in the first year was more than 5 million Yuan, the revenue in the second year was 18 million Yuan, and the revenue in the fifth year reached 200 million Yuan.
Another characteristic of Jiang Xipei who is good at seizing the moment is flexible adaptation. During more than 20 years’ venture, Jiang Xipei accomplished 5 enterprise ownership reformation. Firstly, Jiang Xipei adopted private enterprise Wenzhou model to enable Far East to be rapidly developed, then he twice wore “red hat”—he enabled Far East to become township enterprise and mixed ownership enterprise and solved the problems of high difficulty in loan and deficiency of talents and markets. From Wenzhou model, South Jiangsu model, large and medium-sized state-owned enterprise reformation and perfecting corporate governance structure to enterprise capital operation, on the road of private system reformation, Jiang Xipei completely complied with the reformation of the Chinese market economy. In 2010, Far East made cable business be integrally listed through the listed company S&P pharmaceutical industry CO., LTD which was invested by Far East, and accomplished the butt with capital market.
In the early stage of stepping into capital market, Jiang Xipei did impulse investment because of the great temptation of market. From 1998 to 2001, the accumulated loss of Far East reached more than 0.1 billion Yuan because of copper and aluminum futures hedging and opportunistic practice. After the lessons were learned, Jiang Xipei established the development strategy of main business and investment, namely taking the main business as a base and equity investment as the auxiliary business.
‘For enterprise like Far East, feet must be on the ground, the head must be in contact with the sky, and the vision must be wide’, Jiang Xipei paused and seemed to be thinking something, ‘but I must do things what I am good at, cannot do things which exceed my resource and competence scopes, or the risk is too high, I may beat the air and even be down the drain. Compared with the medicine, realty, biochemistry and investment multiplex development path a few years ago, the path now is more focused. “Take the main business as a son and make it good, and strip non-principal industry property as soon as possible, sell it like selling a pig, or take it as a daughter to find a good husband’s home for her” he said.
For the past few years, a new power transformation plan of the Chinese government was issued. Exploiting a newly added electricity allocation and sales market, exploiting commercial electricity price other than transmission and distribution and exploiting a generation schedule other than commonweal and regulatory generation schedule have become a irreversible trend. That means private capital can enter power generation and electricity selling sides, the benefit distribution structure of the whole electricity industry link will be reconstructed. Meanwhile, new power grid pushes distributed energy, and further cleans the institutional barrier for the starting of the millions of markets of energy Internet. Jiang Xipei grasped the historic opportunity, decided to guide Far East to be transformed to ‘smarter energy’ and ‘smarter city’ service provider business, and guide the Far East to be transformed to a high added value service-type manufacturing enterprise from an original low added value traditional manufacturing enterprise.
Far East has begun to do a series of integration distribution, and tried to break the key nodes in the energy field. In June of 2014, Far East Cable purchased 51 percent of stock right of Intelligence Power which specialized new energy generation and smart power grid planning and design through 0.18 billion Yuan, so that Far East can be involved in new energy design and planning and can distribute distributed power generation side; then, Far East merged and acquire Beijing Semeureka Electric Co., Ltd, developed the advantage on the aspect of distributing line trouble shooting of the company, completed the distribution of the power distribution side, and broken the front-end loop of energy Internet. In July, 2014, ‘Far East Cable’ is renamed as ‘Far East Smarter Energy Co., Ltd’, and finally transformation and orientation are confirmed.
Jiang Xipei was further enhancing the distribution of rear and middle-end links of energy Internet, such as distributed energy, smarter microgrid, carbon asset management and the like. In the July of this year, Smarter Energy invested Traffic Data, and entered the fields of traffic big data consultation and information system integration services. The current complete acquisition of the thirdly largest lithium battery manufacturer Fosters through 1.2 billion showed the ambition of marching the new energy automobile industry chain.
Although Jiang Xipei began from a clockmaker and traditional manufacture, he showed special preference to Internet. As early as 2004, Jiang Xipei who did not understand the Internet field invested 1 million Yuan to Gaoran who was newly graduated from Tsinghua University to do electronic commerce after only reading 3 pages of proposal, and then additionally intested 1 million Yuan to Gaoran to do P2P video technique website after the failure of electronic commerce. In 2005, Far East invested 5 million Yuan to Zhang Xiaowei, Doctor of Tsinghua University to found a mobile electronic commerce website—Beijing Business Infinite electronic commerce Co., Ltd.
Jiang Xipei who has been the classmate of Ma Yun, Li Dongsheng, Guo Guangchang, Shen Guojun and Wang Yusuo in the first Chinese enterprise CEO course class in Cheung Kong Graduate School of Business was influenced by Ma Yun on the aspect of the thinking of Internet, and always dreamed to create an Alibaba in the cable industry.
In September 2011, Far East invested 0.108 billion Yuan to found Far East Maimaibao Science and Technology Ltd. The company mainly dealt “one net and two platforms”, and had three major businesses, cable net, Maimaibao and China material exchange, wherein the cable net is orientated as a global electrical industry door web, Maimaibao is derived to be a global electrical e-commerce transaction platform, and China material exchange is concentrated on real-time online continuous stock bulk commodity transaction. After five years’ development, the page views of Maimaibao exceeded 7 million person-time, members of Maimaitong reaches 4,000, the operation revenue reached nearly 1.5 billion Yuan, the net profit exceeded 20 million Yuan, and the development is Maimaibao is rapid; the annual volume of China material exchange reached 52 billion Yuan.
The investment enthusiasm and the open mind to Internet of Jiang Xipei is not only affected by Internet and investment barons, such as Ma Yun, Ma Huateng, Guo Guangchang and the like, but also affected by his two sons. ‘Their experiences are not better than mine, but for other aspects, they are far better than me’. He was high in tone when speaking the company development strategy, but when talked about his sons, Jiang Xipei was low in voice and could not hide the satisfaction and pride for his sons. “These after-1980 Generation and after-1990 Generation are vigorous generation and have ideas, and I am also affected by them”. In his eyes, his sons are not “rich second generation” but the “second generation entrepreneurs”. They do not enjoy the wealth created by their elder generation, their living expenses are not higher than others no matter they are high school students, college students or graduate students till now, they basically take the subway or bus when going to school or leaving school, moreover, they even do not buy a second-hand car in America.
Both the two sons of Jiang Xipei have attended Nanjing University, and then they studied in America after getting bachelor degrees. The eldest son Jiang Chengzhi returned home after getting a Master Degree of quantative finance, and Jiang Xipei encourage his eldest son to find jobs on one's own. After the practice in Citibank, Jiang Chengzhi went to Chinaventure to be as an investment analyst. Two and a half years latter, Jiang Chengzhi returned Far East, and currently he is responsible for the investment of Far East. This year the second son Jiang Chenghong will also return home and join Far East. Talking to the issue of enterprise heritage, Jiang Xipei expressed, “on one hand, I will continuously dilute my share to feed back employees and society, and on the other hand, a part of the share will be inherited by my family members. When they will to accept it and they are more competent, I am sure to give priority to their inheritance”. Currently, Jiang Xipei has got his third generation and children and grandchildren and four generations lived together.
During realizing transformation through capital merger and acquisition, his sons learning finance inevitably exert important undertake effect. “The merger and acquisition step of Far East has just begun”, Jiang Xipei had a clear planning for enterprise development, “till 2020, our target is that the group revenue exceeds 13.50 billion Yuan, and the annual net profit exceeds 6.0 billion Yuan, wherein the annual revenue of listed company exceeds hundred billion Yuan, the annual market value exceed 150 billion Yuan, and the average annual income of staff exceeds 150,000 Yuan”, Jiang Xipei complacently said.
