Grain Factory researcher Will: 'Courage' is the best guide to action in life right now.

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This year, the theme of Lei Jun's annual speech was "Courage," sharing his journey over the past three years of car manufacturing.

I really enjoyed this speech, not just because it mentioned Professor Shen Lili from my article, but more importantly, "courage" has been the topic I've thought about most over the past three years.

In my view, Lei Jun's courage is reflected in two dimensions: one is the courage to start anew against the backdrop of immense uncertainty; the other is the courage to keep moving forward amid widespread skepticism.

I. Starting Anew Amid Immense Uncertainty

"When everything is uncertain, are you still willing to work wholeheartedly?" This is the soul-searching question posed by writer Tang Nuo in "Thirteen Invitations."

Let’s revisit early 2021, when Xiaomi had just announced its entry into car manufacturing:

In January 2021, Xiaomi Group was added to the U.S. Department of Defense's military blacklist, forcing American investors to sell their Xiaomi stocks and securities within a stipulated time, causing the stock price to plummet. Further sanctions could have put Xiaomi in the same position as Huawei today.

At the same time, the newly launched Xiaomi 11 flagship series unexpectedly faced WiFi issues, sparking a public relations crisis and dealing a blow to Xiaomi's high-end strategy, as Apple capitalized on the market share vacated by Huawei.

Additionally, the recurring COVID-19 pandemic disrupted Xiaomi's ambitious plan to open 10,000 offline stores, with nearly 40% of Xiaomi Stores unable to operate normally during peak periods. Given Xiaomi's heavy reliance on its new retail model, the company had to absorb significant losses.

I don’t know where that period ranks among the toughest moments in Xiaomi's entrepreneurial history, but in that context, Lei Jun's decision to venture into car manufacturing was seen by almost everyone as a near-suicidal move.

Frankly, the challenges Lei Jun faced were no different from those faced by ordinary people during the three years of the pandemic—both were helpless against the tides of the times. The difference, however, is that most people saw themselves as mere specks of dust in the grand scheme of things, justifying their inaction, while Lei Jun chose to bravely start anew amid immense uncertainty.

"Courage is not the absence of fear but the ability to act despite it." This quote comes from psychologist and Stoic writer Donald Robertson. I’m not sure if Lei Jun has read Stoic philosophy from ancient Greece, but he is undoubtedly an excellent practitioner of its principles.

Stoicism emerged during the Hellenistic Age, a period of extreme instability and chaos following the decline of city-states, when philosophers began reflecting on "how to live happily amid uncertainty" (Christianity also originated during this era). Stoicism became one of its shining intellectual achievements, with its most famous representative being Marcus Aurelius, author of "Meditations."

I’ve often cited the Stoic methodology in my past articles: "To attain happiness and freedom, one must understand this principle: Some things are within our control, while others are not. Only by acknowledging this fundamental truth and learning to distinguish between the two can one achieve inner peace and outer efficiency."

Practicing this philosophy requires the Stoic virtues of wisdom, temperance, and courage. As "The Serenity Prayer" teaches us, use wisdom to discern what cannot be changed, temperance to choose what is difficult yet right, and courage to act on those choices.

First, while Lei Jun couldn’t change the long-term uncertainties of geopolitical tensions, unlike some entrepreneurs who relocated to Singapore or Silicon Valley to focus on investments (and perhaps gather disciples), he chose to muster the courage to sue the U.S. government—a feat no one had successfully achieved—and won a comprehensive victory through procedural justice. He also proactively restructured Xiaomi’s international operations, navigating subsequent geopolitical uncertainties with ease.

Second, while Lei Jun couldn’t eliminate the negative impacts of the pandemic, he didn’t shortsightedly close all loss-making offline stores and retreat to Xiaomi’s stronghold of online sales. Instead, he courageously maintained the existing store scale while continuously refining management to improve efficiency. As a result, these mall stores accounted for over 50% of Xiaomi 13/14 series sales and provided significant leverage during the SU7 launch. Xiaomi Stores are now targeting 15,000 domestic and 10,000 international locations.

Third, while Lei Jun couldn’t alter the consumer electronics industry’s heavy reliance on global supply chains, he didn’t passively accept supply chain fluctuations. Instead, he courageously tackled core technologies, adopting a "hardware-software integration with AI empowerment" framework. Xiaomi now builds its own phone and car factories, develops the HyperOS, and will likely unveil the Surge SoC chip soon.

As I wrote in my 2023 Grain Factory year-end review: "The pandemic brought not just suffering but also reflection. It forced us to step back and reconsider what we once took for granted, helping us clarify what truly matters in life. Thus, a few individuals, amid immense uncertainty, persisted with long-termism and delayed gratification, mustering the courage to start anew—and reaping the rewards in 2023."

II. Moving Forward Amid Universal Skepticism

As Lei Jun mentioned in his speech, as a newcomer to the automotive industry, almost everyone felt entitled to offer "Jun’er" advice or warnings.

In the early stages of car manufacturing, Xiaomi received no optimistic voices. In conversations with fund managers or analysts, they all shared pessimistic views about Xiaomi’s car venture, some even suggesting that Xiaomi’s stock price would recover faster if it abandoned the project. Admittedly, car manufacturing requires massive upfront capital with a low probability of success. From a probabilistic standpoint, institutional investors treating it as a liability before significant progress is understandable.

What’s disheartening is that over three years, as Xiaomi made steady progress, the market and institutions didn’t revise their pessimistic views despite positive signals—instead, they doubled down on skepticism. Even by March 2024, on the eve of the SU7 launch, institutional investors I spoke with still predicted only 3,000 units in initial sales.

How does one keep moving forward when no one believes in you? I believe genuine passion and faith are Lei Jun’s greatest sources of courage.

First, genuine passion. To be frank, Lei Jun’s speech revealed actions beyond the scope of a typical executive or investor: test-driving over 100 cars, obtaining a racing license, and participating in extreme weather testing. Friends at Kingsoft told me this mirrors his approach to gaming—forcing himself to play games he didn’t even like.

Second, faith. While passion can overcome much, one must also acknowledge the limits of rationality and individual capability. I believe during these three years, Lei Jun faced many unanswerable doubts—everything hinged on the SU7’s actual launch. At such times, all he could rely on was faith: trust in Xiaomi’s methodology and its fans, believing that "good methodology yields good products," and that these products would resonate with Mi Fans who share Xiaomi’s values.

As I’ve written before, Danish existential philosopher Søren Kierkegaard proposed the concept of a "leap of faith." In essence: "When faced with the impossible or unanswerable, rational people either give up or deny it, forever grieving what’s lost. At such moments, one can only take a 'leap of faith,' using belief to overcome doubt and achieve what reason deems impossible."

III. Is It So Hard to Objectively Acknowledge Xiaomi’s Progress?

On skepticism, I’d like to add: Is it really so difficult to objectively recognize Xiaomi’s progress?

Skeptics always find new reasons to doubt the SU7—first questioning its license, then its product capability, then initial sales (which exploded), then production capacity, then delivery volumes, then gross margins, and now the second and third models. The cycle never ends.

While the SU7’s "10,000 units in 4 minutes, 50,000 units in 27 minutes" sales figures are the best rebuttal to these doubts, had Xiaomi succumbed to this skepticism over three years, and China’s EV market missed out on the SU7, wouldn’t that have been a loss for everyone?

I vividly recall May 2019, when Morgan Stanley analyst Adam Jonas predicted Tesla’s stock could drop 95% from $97 to $10, expressing extreme pessimism about Tesla’s prospects in China—even Elon Musk struggled against such negativity. Five years later, the truth is obvious.

I’m genuinely puzzled: Why can’t the internet afford Xiaomi a little grace? Shouldn’t we cherish someone of Lei Jun’s stature who remains hands-on? In the U.S.-China rivalry, isn’t China’s rise powered by innovative companies like Huawei, BYD, and Xiaomi?

Long ago, I wrote about the self-cultivation of a Xiaomi shareholder, sharing principles I consider vital:

First, apply "first principles" when judging something. Coined by Aristotle in "Physics," this refers to foundational arguments or core logic. When making absolute judgments about Xiaomi, pause and ask basic questions to check for subjectivity or missing information.

These questions may not always favor Xiaomi, but they foster objectivity. Any company reaching a $100B scale will have obvious strengths and flaws. This principle applies universally—from Apple, Tesla, and Microsoft to nations. Nothing is black-and-white; it’s about whether the core logic holds.

Second, respect common sense and set realistic expectations. Xiaomi is just a 14-year-old company. Adjust expectations—whether about fundamentals or stock price—to reasonable levels. Xiaomi won’t master 绝世武功 overnight like a fantasy novel protagonist, nor will minor setbacks doom it. In the real business world, Xiaomi progresses step-by-step on the right path.

Finally, clarify logic and guard against preconceptions. Most online discourse about Xiaomi—like whether it should make cars or has core tech—is preconceived. Once biased, people cherry-pick supporting evidence while ignoring counterpoints. This leads to poor decisions and rejects constructive criticism. Drop preconceptions; view Xiaomi anew, and you might be surprised.

To close, on courage, here are two quotes I love:

When asked what he learned from philosophy, Diogenes replied: "To be prepared for every fortune."

When asked about the highest human virtue, Luo Xiang said: "Courage. When fate pushes you toward a moment requiring bravery, may you be as brave as you imagined."

Grain Factory Researcher Will

July 21, 2024, on a flight from Beijing to Hong Kong