Byte Jump strangled Zhihu Inc. in 2017, but the user gap between Qiang Wukong and Zhihu Inc. rose from 2017 to 2018 and hastily disbanded for only three years in early 2021. After three years, the battle of the Q & A community ended quietly, and Zhihu Inc. won without a fight.

Why did you take a fancy to the question-and-answer community, which was already at the top of Jinri Toutiao? What barriers does Zhihu Inc. rely on to remain invincible?

Industry: content community has great potential for realization

The market potential of China's online content community is huge.

According to CIC, the number of users of China's online content community has expanded significantly from 516.2 million in 2015 to 773 million in 2019 and is expected to reach 1 billion in 2025. A large number of users bring huge room for commercial imagination, and the size of China's online content community market is expected to reach 1.3 trillion yuan in 2025, a compound annual growth rate of 30.3% over 2019.

The top 1.3 trillion markets in the future are still the two most mature advertising and paying members in the industry, which are expected to reach hundreds of billions and hundreds of billions respectively by 2025:

• In terms of advertising, the advertising revenue of domestic content communities has reached 109.5 billion yuan in 2019.It will grow to 510.5 billion yuan in 2025.The compound annualized growth rate was 29.2%, exceeding the overall market for online advertising.

• In terms of paid member income, the member income of the content community is expected to increase from 17.4 billion yuan in 2019 to90.2 billion yuan in 2025The compound annual growth rate was 31.6%.

Competition barriers: creators, users and positive cycles form ultra-high barriers

The market is huge, but it must be competitive enough to get the final fruit. Zhihu Inc. 's competitive advantage, the prospectus summarizes four factors, the most important of which are the following two:

1. 「Profound content and accumulated by creatorsContent quality is essential to maintain the attractiveness and value of the community. Zhihu Inc. attaches great importance to content quality. Through the AI algorithm, the reliability and credibility of its content are continuously enhanced.

   Zhihu Inc. encourages users to become content creators and provides a variety of channels for content creators to contribute and monetize their content in the community. As of December 31, 2020Zhihu Inc. has a cumulative total of 43.1 million content creators who have contributed 315.3 million questions and answers.。」

2. 「Highly sticky user groupZhihu Inc. has accumulated a large, active and loyal user base with very attractive content, and constantly improves the content products to enhance the user experience.

   Fourth quarter of 2020Zhihu Inc. 's average MAU is 75.7 million, with an average of 469 million monthly visitors and an average of 675.7 million monthly interactive visits., respectively, compared with the same period in 201933.0%、28.2%And 4.8%. High-quality content enables Zhihu Inc. to rapidly expand his user base at low cost while maintaining high user engagement and loyalty. The average retention rate of Zhihu Inc. member users is 72% in 12 months. "

It can be seen that the production and consumption of Zhihu Inc. 's contentA bilateral market effect has been formed between the two elements.To promote each other so as to attract more creators and users

In fact, high-quality discussions and interactions also form connections between creators and users.At the same time, stimulate creative desire to form new content, which even makes Zhihu Inc. have some kind of weak network effect.

Business model: centering on content and realizing through diversified channels

According to the prospectus, Zhihu Inc. is mainly a content-centered diversified cash realization method. At present, the more mature ones are online advertising, paid members, and commercial content solutions:

1. Zhihu Inc. 's online advertising helps businesses and brands effectively deliver advertising to the broad target audience.

2. Zhihu Inc. 's "salt selection" membership program provides paying members with unlimited access to high-quality content libraries.

3. The content commerce solution pioneered by Zhihu Inc. provides effective content-based online marketing solutions for businesses and brands, seamlessly integrates high-quality content and marketing tools into the content community, and greatly improves marketing efficiency. at the same time, it also allows users to benefit from valuable business information.

At present, advertising is still Zhihu Inc. 's largest source of income. 2020It is known that online advertising revenue is 843 million, an increase of 46% over the same period last year.Which accounts for the total operating income62.4%In 2019, advertising accounted for 86.1% of revenue.

Payment for knowledge has supported Zhihu Inc. 's second largest source of income. According to the prospectus, the average number of monthly paid members of Zhihu Inc. in Q4 in 20203.0263 million, an increase of 189.84% over 1.0441 million in the same period last year. Zhihu Inc. 's paid member income also increased significantly compared with the same period last year.Revenue reached 320 million yuan in 2020, an increase of 264% over the same period last year.The contribution to total revenue increased from 13.1% in 2019 to 202023.7%。

In addition, Zhihu Inc. also introduced new services, such as online education and e-commerce-related services, to deepen the exploration of diversification.

Finance: ushered in the performance explosion period, cost control is the biggest bright spot, gross profit margin increased for three consecutive quarters

According to the prospectus, Zhihu Inc. 's total revenue in 20201.352 billion yuan, an increase of 101.7% over the same period last year. The revenue in the four quarters was 188 million yuan, 261 million yuan, 383 million yuan and 520 million yuan respectively.Maintain an ultra-high growth rate of 30% compared with the previous month。

Zhihu Inc. 's income cost is 594 million yuan in 2020, and the cloud service and bandwidth costs, content and operating costs account for the largest proportion of Zhihu Inc. 's income costs.Content and operating costs mainly includeThe content creator pays for the content contained in Zhihu Inc. 's high-quality content library, third-party content license fees and other business-related implementation costs.

Although content and operating costs increased significantly by 186% to 204 million in 2020,The proportion of 15% is still not high.，与Bilibili Inc. 's 60% income share is compared with the content cost.It can be said that the advantage is huge.

The gross profit in the last four quarters was 78.25 million yuan, 126.4 million yuan, 220 million yuan and 333 million yuan respectively.The gross profit margin was 41.6%, 48.4%, 57.4% and 64.1% respectively, achieving four consecutive quarters of increase.. The gross profit margin was 56% in 2020 and 46.6% in 2019, a sharp increase of nearly 10 percentage points over the same period last year.

Shareholder: founder firmly on the rudder, many well-known institutions blessing

In terms of equity, Zhihu Inc. adopted AB shares to protect the control of management. At present, Zhou Yuan, founder, chairman and CEO of Zhihu Inc., owns 475279 Class A common shares and 19227592 Class B common shares.8.2% of the shares and 46.6% of the voting rights。

In the past few years, Zhihu Inc. has completed several rounds of financing. Innovation works, QiMing Venture Partners, Saifu Fund, Tencent, Baidu, Inc., Kuaishou Technology and Sogou are all shareholders of Zhihu Inc..

According to the prospectus, Innovation works currently accounts for 13.1% of the shares and has 7.6% of the voting rights.

Tencent holds shares12.3%With 7.1% of the voting rights

QiMing Venture Partners has 11.3% of the shares and 6.6% of the voting rights.

SAIF IV Mobile Apps (BVI) Limited has 9.3 per cent of the shares and 5.4 per cent of the voting rights.