Exclusive | A Conversation with Dongqiudi's Chen Cong: "I Used to Think Everyone Was a Good Person"

By Jiaxiang Shi

Edited by Jing Liu

On the evening of October 30, Chen Cong, founder of Dongqiudi, abruptly decided to address some questions online. It was his first livestream, hastily prepared, and the connection dropped twice. After going offline, he still fell into his habitual anxiety, not falling asleep until eight or nine in the morning. This state had persisted for more than half a year.

Six months prior, Tianxing Capital, the Series C investor in Dongqiudi, had initiated arbitration against the company. Over 40 of Dongqiudi's trademarks were then auctioned off to its competitor "Zhibo8" for roughly 20.9 million yuan.

Through that agonizing half-year, Chen Cong never appeared in public to explain the circumstances. Not until the day before the livestream, when he received the ruling from Beijing No. 1 Intermediate People's Court: the auctioned Dongqiudi trademarks were to be revoked.

He had originally intended to issue a formal company response to the entire affair. He couldn't hold back, though — in half an hour he wrote a post and published it on Moments. In it, he wrote that "Zhibo8" and the so-called "shareholder" Tianxing Capital had colluded, splitting up Dongqiudi's trademarks and blocking other bidders to carve up their core assets at a low price.

All of this turbulence began in September 2016, when Dongqiudi closed its Series C round led by Suning, with Tianxing Capital following on for 30 million yuan. Chen Cong hadn't thought much about the money, choosing them more because they "played soccer together and got along well" — searches still turn up a friendly match between Tianxing Capital and Dongqiudi on Zhichun Road.

In Chen Cong's view, looking back now, there are rights and wrongs among the parties involved, but the outcome was also forged from many coincidences. Chen Cong founded Dongqiudi at age 24. For such a young founder, as he himself put it: "It's hard to think through so many things."

Yesterday, Anyong Waves interviewed Chen Cong at Dongqiudi's office. He spoke candidly about the causes and consequences of this dispute, the rights and wrongs of the various parties, and his 11-year journey building Dongqiudi. He's the type with a distinctive personality who doesn't dodge anything, repeatedly asking us whether he had expressed himself clearly.

Chen Cong's office contains no desk or computer, only a few sofas for solitude and receiving guests. He says he no longer manages the company's day-to-day operations, just handling emails on his phone and using the Dongqiudi app.

Since moving to the 11th floor of Jinqiu Tower in 2015, Dongqiudi hasn't relocated. Without this public controversy, it would have continued growing at its own pace, in an unnoticed corner.

Painkillers to the Point of Nausea for Six Months

Anyong: Zhibo8's lawyer responded to you yesterday, arguing that the auctioned Dongqiudi trademark rights belong to Zhibo8 — like real estate auction, you should vacate.

Chen Cong: That's nonsense.

Houses and trademarks aren't the same. A trademark has to be transferred before you vacate. Dongqiudi has over 160 trademarks; they only bought 40-something. By law, when a company transfers trademarks, similar ones must be transferred together — otherwise the market becomes chaotic with different companies holding related marks. We could launch Dongqiudi, and so could they.

So the normal logic is we keep using it until Zhibo8 completes the registration transfer.

Anyong: Who currently holds the trademarks?

Chen Cong: They're in our hands, just frozen. Actually even after the auction, the trademarks remained in our hands. From a legal perspective, the property rights belong to Zhibo8, but the right to use has always been with us — registration transfer has to happen first before they can use them.

The official Dongqiudi app isn't back online yet. We launched Dongqiudi Pro first to ensure users can download normally. The main app might be ready in a few days.

Anyong: How did you first connect with Tianxing Capital?

Chen Cong: Several Tianxing partners were soccer fans, we played together, seemed like good people — but the discussions were fairly casual. It was 2016, that round raised over 180 million, led by Suning.

Anyong: By 2016, private PE firms like Tianxing Capital were already in difficult straits. Why still take their money?

Chen Cong: I didn't even understand the LP-GP relationship at the time, and basically didn't research these private PE firms. I figured it was a small follow-on stake, not worth overthinking. And many friends of mine had also taken Tianxing's investment — now they're all asking me how to handle this.

Another factor: we were right in the middle of restructuring the company into a VIE, so Suning and Tianxing's investments came in through debt-to-equity conversion. Around 2020, Tianxing demanded the 30 million be returned.

It was pandemic times, we were having some operational difficulties, so we first gave 10 million with the rest to follow in installments. But halfway through negotiations, in 2021 or 2022, Tianxing suddenly went to arbitration. We figured we'd end up paying anyway, so we didn't spend much time on it.

Anyong: If they filed for arbitration, it clearly wouldn't be simple. Why "not spend much time on it"?

Chen Cong: We initially offered shareholders very high interest, 12%. So the arbitration amount came to 40 or 50 million — 30 million principal plus other fees. But frankly, we didn't think anyone was a bad actor, just talk it out and pay what they want.

Paying 30 or 40 million at once was difficult, so we kept negotiating. But every time we reached an agreement, they'd reverse course the next day, adding 3 million or 5 million — always like this. Then around June or July last year, we learned the trademarks were being auctioned.

And actually, we only found out on the day the auction closed that only 40 trademarks were being sold and they couldn't be transferred.

Anyong: You seem pretty easygoing, and constantly pushed around.

Chen Cong: Very easygoing. One wrong step led to another, and I didn't think they'd actually auction them.

Anyong: Could Tianxing have thought you didn't have enough cash?

Chen Cong: Even when Tianxing later demanded 10 or 20 million upfront with the rest in installments, we'd have found a way. We just could never reach any agreement. Actually after the auction, we also proposed a settlement to Tianxing — having other shareholders buy the debt at a price higher than the 20.9 million auction proceeds — but they refused.

Anyong: If you could have paid the arbitration amount within a certain timeframe, theoretically the auction wouldn't have happened.

Chen Cong: Last year we were doing large-scale buybacks for original shareholders — basically any shareholder who wanted to exit, we were paying in installments — so we couldn't pull together that much cash at once. Unless it happened during the World Cup or Euros.

Second, our internal judgment was that the trademarks were highly valuable, and without major industry players entering, there wouldn't be that much money, and certainly no one would compete by buying trademarks.

The day before the auction, we were still talking with Tianxing about repayment. We didn't expect Zhibo8 to become a variable.

Anyong: What's Tianxing's internal situation now?

Chen Cong: We had little contact for four years in the middle. Many people left — from 2020 to today, I've met four different waves of Tianxing people. Now Tianxing probably has three partners plus some post-investment staff.

Anyong: Looking back at your entire process of dealing with Tianxing, which decisions do you think were less than ideal?

Chen Cong: First, when accepting the investment, we didn't do proper due diligence on the company. Too much wishful thinking, figuring it was a small stake, not worth overthinking.

Second, subsequent communication wasn't very smooth, and we didn't understand their problems. If when negotiating repayment in 2020, we'd known they were in such difficulty, we could have tried to lower expectations and quickly paid it off to resolve things.

Finally, after the trademarks were frozen, we didn't take countermeasures. Frankly, I initially assumed everyone was a good person. This whole thing surprised me, it shook my values somewhat.

Anyong: Have you communicated with Zhibo8?

Chen Cong: On the first or second day I tried to persuade them, said don't pay, these trademarks can't be transferred. If you think there's bad blood, we can talk it out. Don't make us mortal enemies.

Anyong: In 2015, there was a period when searching for "Zhibo8" on Baidu led to downloading "Dongqiudi." You responded at the time that all ad placements were with legitimate internet companies following the rules. Has your thinking changed at all?

Chen Cong: Everyone was competing then, all trying to acquire users — like now when you search Dongqiudi, other apps still rank first. And while I talked tough then, I'd actually already stopped. If it bothers you, I won't keep provoking you.

Because "Zhibo8" couldn't be trademarked, there were many "Zhibo8"s on the market, I wasn't targeting anyone specifically. After our trademark was taken, we even considered the worst-case scenario of just calling ourselves "Zhibo8" too (laughs).

Anyong: What's your thinking now?

Chen Cong: Honestly, I have some regrets. I feel like I've been hurt for too long. After going to court in June, if I'd gone public immediately with a report, posted an article, made an ID-card video and put it on Dongqiudi — the Euros were still on then, our app hadn't been taken down yet — it would have blown up instantly. Maybe it would have been resolved quickly.

Now the core is to get this off my chest. Everyone at the company has been under too much pressure, we just want to see justice done and tell fans what happened. Also warn others not to mess around.

Beyond this incident, Dongqiudi is doing fine, and we don't want excessive exposure. These six months, really, painkillers to the point of nausea.

I Was Only 27, Hard to Think Through So Many Things

Anyong: A few years ago there were rumors that Dongqiudi would IPO?

Chen Cong: I actually never wanted to go public, just couldn't say that to shareholders (laughs). If we were good at playing to capital, we wouldn't have chosen Dongqiudi or soccer as our track from the start — at minimum we'd have done sports broadly.

Anyong: Did you think this way even during the rapid fundraising before 2016?

Chen Cong: I started my company in 2013 at 24, hadn't figured out how to interface with capital or raise funding.

The economic environment was in an upcycle, so you did what others told you to do, just thinking about raising as much as possible to expand market share. Including later restructuring into a VIE — that was also following others' advice.

In this process, the capital cycle turned downward, and Dongqiudi as a company wasn't as sexy as imagined. The Chinese soccer market just wasn't big enough.

Anyong: When did you realize the environment had changed and Dongqiudi's high-speed growth had stopped?

Chen Cong: It wasn't entirely environmental factors. During the Series C round, Suning was the lead and offered a higher valuation — they'd also bought Inter Milan at the time, so we thought about partnering with a sports giant. But Suning was also building Suning Sports.

Our subsequent structural difficulties all stemmed from our cooperation with Suning — not just the investment, but also intertwined investment business cooperation, integration, restructuring. Suning wouldn't sign the debt-to-equity conversion agreement, and I didn't want to sell.

We discussed and磨合 for a long time. Afterward no institutions could enter, and no one wanted to enter a company with 150 million in debt.

We were also burning money on the overseas product All Football at the time, and ran out of money halfway through.

Anyong: Didn't anyone warn you this was risky?

Chen Cong: Things had gone too smoothly before, so my risk tolerance was too high. We thought the VIE restructuring would be quick, but that year hit the strictest foreign exchange controls, prohibiting RMB from leaving the country, which dragged on for a long time. Suning's thinking also changed.

If the restructuring had been completed that year, it would have converted to equity immediately, and there'd be no subsequent debt repayment issue. So many maneuvers at the time, I still can't explain them now — so many coincidences.

Including later, after 2018 when fundraising became impossible, the industry started declining, then COVID hit, competitions stopped completely for half a year, losing six or seven million a month. Now buybacks started again, things never ended. After this trademark incident, the company actually became quieter.

I was only 27 in 2016, first time founding a company, made it to Series C — everything was a first experience. It's hard for a 27-year-old to think through so many things.

Anyong: How much total funding has Dongqiudi raised?

Chen Cong: I haven't calculated specifically, maybe over 300 million.

Anyong: How much more in buybacks?

Chen Cong: Roughly 100 to 200 million. Hongshan and Xianfeng from earlier rounds haven't expressed exit needs yet.

On the day of the ruling, I was still negotiating with Suning. We've made a timeline, planning to finish all buybacks by 2026 — conveniently that's a World Cup year. I have some PTSD now; as long as we don't negotiate then reverse, I'm okay.

Want to Free Up Time to Learn How to Live

Anyong: Has Dongqiudi recovered recently?

Chen Cong: Actually we recovered after COVID, the core was continuously paying people back. Overseas competitions gradually resumed in early August 2020, we added advertising, and since then the company basically hasn't fallen back into losses.

Anyong: After COVID you became profitable and started shareholder payouts — was this profitability at the expense of user experience? Many users complain, hoping you'll permanently set the cover to "Still remember childhood dreams?" instead of shake-to-view ads.

Chen Cong: We learned from Zhihu and Weibo back then — leave the app for a minute, come back and there's an ad. Learning this model, ad revenue went from 3 million a month to peaking at roughly double.

Later SDK ads became shake-to-view, shake-to-activate. E-commerce platforms invested 1 billion into platforms; if they didn't do this, they couldn't spend those budgets. Sometimes we'd ban these little tricks, and somehow new ones would appear.

We've reviewed this before, ultimately finding a balance between ad density and user retention. With an ad-free membership, we'd lose 2 million a month.

Anyong: What's current ad revenue?

Chen Cong: Back to around 3 million a month, slightly better during 618 and Double 11 months.

Anyong: Down 2 million, can you still be profitable?

Chen Cong: It gets slightly awkward. Can't guarantee profitability every month.

Anyong: Have you explored other business models?

Chen Cong: We've tried our best, but honestly it's difficult. Because Chinese soccer and sports haven't developed much, there aren't many points to explore. We're not playing to capital now, doing annual buybacks, running the company steadily, don't want to take more risks.

Anyong: Will ads decrease going forward?

Chen Cong: They will decrease. At this stage we'll explore more B2C or other services.

After getting through this wave, we'll also properly develop overseas markets, like Southeast Asia — overseas daily active users are already 1.4 to 1.5 million. Actually this trademark issue has already delayed us six months.

In the previous upcycle, everyone thought money wasn't money, could burn it aggressively. Now we're supporting overseas expansion with profits, so we'll be more cautious.

We're also doing more non-soccer content — basketball, tennis, table tennis, other sports. We found users still want Olympic-style events. For example this weekend's S14 esports final, Dongqiudi users will watch too, and when they watch they should discuss it right here instead of going elsewhere.

Anyong: What's Dongqiudi's current DAU?

Chen Cong: Between 3 and 4 million.

In the PC era, sports was a huge track. Then mobile internet came, and sports became a very small niche segment. The entire internet pie is also shrinking — no use rushing. Dongqiudi's revenue and DAU are still growing, just slightly slower.

The company can basically run itself now, I just make key decisions and don't interfere with daily operations. I originally wanted to take this year off — spent two months at the Hangzhou branch early this year. If I don't manage things, it might only affect 5% or 10% of company profit, not much.

I'm 35 now, not without passion, but not anxious anymore. Before, everyone was starting companies, you didn't want to fall behind. Now I feel, it's fine, everyone has their own strengths, just do your own thing.

Anyong: How do you view entrepreneurship now?

Chen Cong: Not fun. Honestly if I could do it again I'd really regret it (laughs). The bigger you build, the more pressure you bear — really painful.

Anyong: Ever thought about selling the company?

Chen Cong: No. The company is like my own child. After the open letter was published, many users posted screenshots showing they'd been on Dongqiudi for X days — that touched me deeply. Others might treat their company as a business or career, but Dongqiudi is my life.

But sometimes I also feel my ambition isn't as strong anymore, and I want to free up time to learn how to live.

Image source: IC Photo