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Tuanbao CEO Ren Chunlei: ‘Investment is Poison’

ren-chunleiTuanbao (aka Groupon.cn) CEO Ren Chunlei is quickly becoming my new favorite internet crazy person. Hot on the heels of his decision to stop accepting money from customers — all deals on Tuanbao are now free — he’s given another interview in which he suggests his investors are poisonous and blamed them for Tuanbao’s downfall.

Speaking to China Business News, Ren seemed to blame investors for the company’s massive layoffs, saying that they had pushed him to expand rapidly during the first half of 2011, and then forced him to lay people off in the second half of the year. One investor apparently promised to deliver some “rescue money” only after Tuanbao slashed costs. But after the layoffs, Ren says, this investor gave only one million RMB ($158,000) and told Ren to tell everyone at the company that’s all they were going to get. Ren characterized this as “acting like a hoodlum” and said he was very disappointed by the investor.

As for the layoffs, sure, Tuanbao is down to about 100 employees after having more than 2,300 at its high point last year. In other words, it laid off 96 percent of its staff in less than one year. But Ren sees things differently: at one hundred employees, the company has twenty times the staff it did back when he founded it with a team of five.

Ren offered some sound advice for startups: pay attention to the person when you’re looking for investment, because money taken from the wrong person “is like poison.” True, but perhaps it’s not a great idea to be bad-mouthing all one’s former investors while simultaneously looking for investment to support a company with no income?

Whatever, Ren’s not worried about that. And he’s not worried about old shareholders blocking new investors from buying into Tuanbao. If they do, he says, the company will go bankrupt and he can just start a new company with the new investors, free of the old investors’ influence. Good to know, but it makes you wonder why any merchant would want to work with Tuanbao when its own founder is apparently willing to declare bankruptcy and start a new company at the drop of a hat.



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