was once sought after
"Genius boy" Liu Zihong and his two Tsinghua University and Stanford alumni Wei Peng and Fan Junchao co-founded Royole Technology.
In August 2014, Royole released the world's thinnest color flexible display, with a thickness of only 0.01 mm and a curling radius of up to 1 mm, which was a subversive technical level at that time.
Favored by capital, it has received 7 rounds of financing in two years.
has been questioned
At first, it was questioned that the product could not be developed, and then it was considered that the product could not be mass-produced after it was developed. After the product was mass-produced, it was accused of low yield rate and insufficient production capacity, and then it was questioned that it lacked application scenarios and could not sell the product.
Chen Luo joined Royole Technology in 2020. At that time, Royole Technology had just completed the $300 million F round of financing, and it was rumored that it was going to IPO in the United States.
Liu Zihong, the founder of Royole Technology, is known as a "genius boy". At the age of 17, he was admitted to Tsinghua University with the first place in the science college entrance examination in Fuzhou, Jiangxi Province.
After graduating from the Department of Electronic Engineering of Tsinghua University with a master's degree, Zihong Liu obtained a Ph.D. from the Department of Electronic Engineering of Stanford University in the United States.
In May 2012, Liu Zihong returned from the United States to start a business, and jointly invested 100,000 yuan with two other Tsinghua University and Stanford alumni, Wei Peng and Fan Junchao, to establish Royole Technology.
In August 2014, Royole Technology released the world's thinnest color flexible display, with a thickness of only 0.01 mm and a curling radius of up to 1 mm, which was a subversive technical level at that time.
Royole Technology is highly sought after by capital.
From August 2017 to November 2019 alone, Rouyu Technology has received 7 rounds of financing, including many well-known investment institutions such as CITIC Capital, Shenzhen Venture Capital, Hangzhou Cornerstone, and Poly (Hengqin) Capital.
In 2020, Rouyu Technology also ranked in the top 12 of the "2020 China New Economy Unicorn Top 200 List" with a valuation of 6 billion US dollars, and became the "China Entrepreneur" 2020 "China Top 100 Science and Technology Enterprises". top of the list".
Xu Xiaoping, a famous angel investor and founder of ZhenFund, also sighed at the loss of Royole: "Every time I see the good news of it, my heart is twisted, and the pride of being an angel investor is crushed to smithereens. "
At the end of last year, the unicorn Royole Technology, which was once valued at more than 50 billion yuan, was exposed to the shortage of funds and arrears of employees' salaries.
Today, Royole Technology is still in the dilemma of "lack of money".
On March 29, Chen Luo, an employee of Royole, told the Red Star Capital Bureau that from September last year to the present, he has received 5 emails with unpaid wages within 6 months, and the content of the emails is roughly the same: "The company's financing is progressing, and the funds are coming soon. When the account arrives, the salary will be paid immediately.”
According to Chen Luo's calculations, Royole Technology has owed him nearly 100,000 yuan in salary.
Before February 2021, Royole Technology's "Halo Plus" is highly sought after by capital, including many well-known investment institutions such as CITIC Capital, Shenzhen Venture Capital, Hangzhou Cornerstone, and Poly (Hengqin) Capital.
But now, Rouyu Technology is deeply caught in the whirlpool of "paid arrears" and has been seeking financing help. The Red Star Capital Bureau has noticed that since the withdrawal of the listing application, there has been no new investment from Royole.
What the hell happened to this unicorn?
Royole employees:
If you don't pay enough to send emails, you've been owed nearly 100,000 yuan
Chen Luo, who has worked in Royole Technology for nearly 2 years, can't figure out why this unicorn, which was once valued at more than 50 billion, has come to this point.
"The company has been actively promoting the financing work, and there has been significant progress recently. Since the funds have not been in place in time, the salary on March 10 will be paid at the end of the month, please understand."
"Another unpaid email", Chen Luo thought about it, this was the fifth unpaid email in 6 months, and Royole Technology owed him nearly 100,000 yuan in salary.
Before February 2021, Royole Technology is a unicorn company with a "halo body".
This flexible OLED screen manufacturer established in 2012 is highly sought after by capital, and the financing has reached the F round.
However, on February 9, 2021, Royole Technology withdrew its listing application documents, and then disappeared from the public eye.
When it reappeared, it was actually because of arrears in employee wages.
Chen Luo recalled that since September last year, Royole Technology had already shown signs of financial constraints. At that time, it was the Mid-Autumn Festival, and the company did not even send out boxes of mooncakes.
Immediately after October 10th, it was the payday of Royole Technology, but instead of a notice that the salary had arrived, Chen Luo received an unpaid email telling him that only 40% of the salary in September would be paid.
At that time, Chen Luo still had hope in the company and thought that the situation would improve. However, what he was waiting for was the news of "the salary arrears in October" and "the salary arrears in November".
On December 8, 2021, employees of Royole Technology left a message on the Internet, accusing Royole Technology of arrears in wages, which soon attracted attention, and public opinions about the shortage of funds and large-scale arrears of wages in Royole Technology began to ferment.
On December 31, 2021, Rouyu Technology repaid the employees' wages for November, but there is still no explanation for the previously arrears.
Afterwards, there were public reports that Royole's funding problems had eased, part of the employee's salaries had been paid, and Royole's arrears of wages gradually subsided.
Chen Luo said that Rouyu's salary arrears continued.
In January, February and March 2022, Rouyu Technology will also replace the salary with an unpaid email.
During this period, the number of people in the Royole OA system continued to decrease. Chen Luo noticed that the number of employees had dropped from 1,800 to 700.
Now, facing the phrase "financing is progressing, funds are about to arrive, and wages will be repaid immediately", Chen Luo's heart has long been numb, he closed the email and opened the recruitment website.
Look again from the prospectus
Royole Technology's scientific and technological excellence
money-losing vicious circle
Today, Royole Technology seems to be caught in a vicious circle, constantly raising funds, but always "short of money".
In 2020, Royole Technology shelved its plans for an IPO in the United States, and turned to the A-share Science and Technology Innovation Board on the last day. It plans to raise 14.4 billion yuan, of which 7.2 billion yuan will be used to supplement working capital.
However, once the prospectus was disclosed, the current situation of the tight capital chain of Royole was exposed to the public.
From the perspective of revenue data, from 2017 to 2019 and from January to June 2020, the company's operating income was 64.7267 million yuan, 109 million yuan, 227 million yuan and 116 million yuan, of which there are many unaccounted. "Accounts Receivable".
In addition, Rouyu Technology has been in a state of loss. In the above time line, the net profit attributable to shareholders of the parent company was -359 million yuan, -802 million yuan, -1.073 billion yuan and -961 million yuan respectively.
In other words, the company has only achieved a total revenue of 517 million yuan in three and a half years, but the loss is as high as 3.2 billion yuan, and the loss rate has continued to expand.
While the annual loss continues to expand, the cash flow situation of Royole Technology is not optimistic.
The company's operating cash flow net outflow amounted to 358 million yuan, 612 million yuan, 811 million yuan and 386 million yuan respectively within the above time line, and the liquidity pressure continued to increase.
In the second half of 2019, four executives including Liu Zihong and Fan Junchao also borrowed funds from Royole Technology.
unsellable product
Taking a closer look at the "lack of money" problem of Royole Technology, the most important reason is that Royole's own lack of "hematopoietic" ability.
The Red Star Capital Bureau found that Royole Technology has been questioned from beginning to end.
At first, it was questioned that the product could not be developed, and then it was considered that the product could not be mass-produced after it was developed. After the product was mass-produced, it was accused of low yield rate and insufficient production capacity, and then it was questioned that it lacked application scenarios and could not sell the product.
At the beginning of 2020, at the critical moment of Royole's IPO, the public found that Royole-related products were rarely seen on the market.
In fact, Rouyu is not without products, but "unable to sell".
In the face of the B-side, Royole has launched a fully flexible screen with "low cost and high yield". So far, it has not been used on a large scale in any mainstream mobile phone manufacturer's products.
And the cooperative customers of other application scenarios that Rouyu has promoted externally, such as ZTE, Airbus, China Mobile, etc., its cooperative products are almost hard to find in the mass market.
In the face of C-end products, taking Royole's foldable flexible screen smartphone FlexPai as an example, according to 21st Century Business Review estimates, the annual sales volume of its mobile phone business is only about 7,112 units.
Even if all consumer revenue comes from the mobile phone business, sales in the first half of 2020 will only be 14,700 units.
The reason for the low sales is not only that Rouyu has no advantage over pricing, but also has exposed quality problems.
Consumer Wang Qi told the Red Star Capital Bureau that he once bought a Royole FlexPai mobile phone for about 5,000 yuan, but it was overhauled 4 times within 10 months of purchase.
"Once the screen is broken, the repair cost will be more than 900 yuan. After a few repairs, you can buy another mobile phone." Wang Qi was very disappointed with the quality of Rouyu's mobile phone.
Royole has also launched true wireless headphones, fashionable clothes and hats, selfie sticks, smart notebooks, etc., all of which have received a mediocre market response.
Insufficient capacity
The Red Star Capital Bureau found that due to the lack of long-term market orders of Royole Technology, the company's capacity utilization rate was too low.
The data disclosed in the prospectus can also confirm this. In 2018, 2019 and the first half of 2020, Rouyu’s capacity utilization rates were 15.1%, 31.2% and 5.3%, respectively, which also means that the company’s production capacity is 1.5% most of the time. in idle.
In terms of production and sales ratio, the sales volume is also far lower than the actual production.
The actual output of its fully flexible display in 2019 was 314,000 units, but the sales volume was only 52,700 units; in the first half of 2020, the actual output was reduced to 48,600 units due to the impact of the epidemic, but the sales volume was only 22,100 units.
That is to say, the products produced by the company cannot be converted into sales revenue in time.
Liu Chang, a former employee of Royole, was impressed.
On March 29, Liu Chang told the Red Star Capital Bureau, "Starting in the second half of 2019, the volume of Rouyu production lines will become less and less. Until the end of 2020, it will run once a month at most, for two or three days, and others. Time is vacant, and I only run for about a week before I leave in September 2021.”
Doubtful technical line
How is Royole technology?
According to Jiemian News, an engineer who used to be responsible for screen research and development in Royole said that Royole does have its own technology, but the ultra-low temperature non-silicon process integration technology, which is regarded as its biggest advantage, is essentially IGZO+ vapor deposition OLED process. Someone has been doing it for a long time, and it is not exclusive to Rouyu.
He recalled: "In 2017, Royole started to build a 6th-generation display production line in Shenzhen. At that time, I felt that the company was really going to start making something, but I have been working in it, and I have seen the equipment inside, but it doesn't look like it. It's like trying to make it bigger, because it doesn't have the ability to mass-produce it."
The person in charge of a panel manufacturer commented: "Among the domestic manufacturers, Royole's R&D capability is slightly stronger than Tianma and Hehui Optoelectronics, but its mass production capability is the last one, and it is far behind other manufacturers. Because the R&D line makes concept products And mass-produced products that meet market demand are technical routes of completely different latitudes.”
At the end of last year, when Rouyu Technology was exposed to arrears of wages, founder Liu Zihong quoted the article "Musk recalls the brink of bankruptcy: wake up every day and cry all night in his dreams" on his personal social media, and said: "Actually, It's not easy for everyone. In the darkest moments of life, don't expect help in the snow, the only thing you can do is to persevere to the end and never give up."
Now it seems that the darkest moment for Liu Zihong and Royole Technology has not yet passed.
Chengdu Commercial Daily-Red Star News reporter Yu Yaoqiang Yaxian