Jobs Spurs Harvard MBA to Drop McKinsey for China Website
Qin Zhi says Steve Jobs’s “Stay Foolish” commencement speech at Stanford University in 2005 was so inspiring, the Harvard MBA left his consulting job at McKinsey & Co. in New York for an Internet startup in China.
“After reading those words I thought to myself what I was doing then was absolutely not my passion,” Qin, now chief executive officer of Autohome Inc., which operates China’s largest vehicle-comparison website, said in an interview last week in Beijing, where he was born. “What I did had no risks and I felt like I was wasting my life. So I decided to seek a change.”
Six years after joining Autohome in 2007 as employee No. 38, Qin has helped oversee a 100-fold increase in revenue that topped 1 billion yuan ($163 million) last year. Today, the company employs more than 1,000 people and its namesake website attracts an estimated 6 million unique users a day, about double that of the online car section of top Chinese Internet company Tencent Holdings Ltd. (700)
Such success means investors in closely held Autohome, which is 66 percent-owned by Australia phone company Telstra Corp. (TLS), may cash in should it go public. For now, Qin declined to comment on the subject beyond saying that the company may seek an initial public offering in the U.S. “at a certain point of time.”
If so, Autohome would follow Bitauto Holdings Ltd. (BITA), the Beijing-based vehicle-pricing website operator, which held its IPO in 2010 and saw its stock triple in the past year. Nasdaq-traded Sohu.com Inc. (SOHU) and Sina Corp. (SINA) both listed in 2000.
Like car-buying websites in the U.S., Autohome provides Chinese consumers with auto prices in China, though Qin, 41, says the company is better described as a combination of Edmunds.com, AutoTrader.com and Kelley Blue Book in the U.S.
Chinese car-shopping websites may be attractive for investors seeking to profit from the country’s expanding vehicle sales and the fact that no country has a bigger cyber population, said Xu Hao, an analyst at IResearch in Beijing.
China’s annual vehicle sales have more than doubled in the past five years to become the world’s largest auto market and deliveries are projected to increase to 30 million a year by 2020, from about 20 million this year, according to the China Association of Automobile Manufacturers.
The number of Internet users in China rose to 591 million in June, from 564 million in December, according to the China Internet Network Information Center website.
“China’s auto industry and Internet industry have been developing in parallel at the same time,” Qin, a graduate of Harvard Business School and China’s Tsinghua University, said in his office in Zhongguancun, the country’s Silicon Valley. “It is a historical opportunity that no other countries have for the development of auto websites. It turned out to be our luck.”
Qin said he might have missed the boom if he hadn’t moved back to China after reading Jobs’s speech while working on an internal project at McKinsey that required him to commute daily between Stamford, Connecticut and New York.
The late Apple Inc. (AAPL) chief had urged the graduating class at Stanford to do what they love, take risks and not to waste their time living someone else’s life.
“You can’t connect the dots looking forward; you can only connect them looking backwards,” Jobs said in his speech. “So you have to trust that the dots will somehow connect in your future. You have to trust in something -- your gut, destiny, life, karma, whatever.”
Jobs said this approach has never let him down and it has made “all the difference” in his life. He ended the speech with the now-famous dictum: “Stay hungry. Stay foolish.”
Qin, who worked at a Chinese Internet startup that was sold to Google Inc. before joining Autohome as its No. 2 executive, declined to disclose more financial details for Autohome beyond saying it is profitable and has “pretty high” margins by Chinese standards.
Telstra, which in 2012 bought an additional 11 percent stake in Autohome for A$37 million ($34 million) that valued the Chinese company at more than $300 million, has said it’s pleased with its investment.
“The Autohome business continues to rip along,” Telstra Chief Executive Officer David Thodey said in February, according to a transcript of the earnings call at the time. “Now very small, admittedly, but a very good little property.”
About 70 percent of Autohome’s revenue comes from automakers in the form of advertising and sales referrals, with the rest coming from dealers, according to Qin.
Autohome provides pricing details from 7,500 dealerships across the country, giving users up-to-date data to compare the latest promotions and discounts, according to Qin.
The company has “a lot of respect” for the independence and integrity of car reviews by Santa Monica, California-based Edmunds.com, he said. Autohome’s own team of editors test-drive cars and write reviews under their real names and the company makes a clear distinction between its own reports and those provided by automakers, which isn’t standard practice in the industry, he said.
“We want to make Autohome.com the online destination for China’s automobile consumers,” Qin said. “Consumers’ interests come first. For companies that want to live long and well, they have to take consumers’ interests as top priority instead of the short-term financial returns.”
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