A reader left a message asking the following question:

"Have you finished reading the book 'Because Unique'? What are your thoughts on the future of Labubu? I completed the book and indeed feel that Wang Ning's attitude towards his work is worth learning from, but as for the future development of this company, I sincerely can't understand it. I don't know if you can understand it... or what your thoughts are on Labubu as a whole?"

Coincidentally, I have been very interested in Pop Mart and have been observing this company for more than a year, so today I will share my thoughts on it.

I discovered Pop Mart at the end of 2024 or the beginning of 2025, but I can't remember what led me to find it.

At that time, there hadn't been a lot of online reports about Mai Gang investing in it, let alone news about Duan Yongping buying into it.

Why did I continue to pay attention to it after discovering it?

Because at first glance, I thought this company was quite strange. Can these kinds of toys really sell so well?

I was about to turn and leave, but then I recalled a significant lesson I learned from missing the opportunity to invest in Bitcoin: when encountering something new, set aside your preconceptions, look more at its positive aspects, and actively observe its strengths and differences.

From that moment on, I began to consciously follow it.

Not only did I follow it, but I also bought its trendy toys.

For example, I bought Molly (but after buying it, I realized I didn't like it that much), and later I bought the first complete set of the Labubu Forest series building blocks (though after buying them, I couldn't bear to piece them together, so they were left untouched—I can't say I have any strong feelings about them), and later bought some Labubu keychains.

To compare, I also purchased some dolls from other trendy toy brands (like Top Toy, etc.).

After comparing, I didn't think that all of Pop Mart's toys were good; I just thought Labubu was not bad.

But being not bad is one thing, and I can't say I'm so enamored that I can't put them down, let alone being obsessed with them.

So later on, I didn’t pay much attention to it anymore.

However, whenever I had the chance to pass by one of its stores, I would always go in and browse, even if I bought nothing.

Later, when news of Mai Gang investing in Pop Mart spread everywhere, I began to pay attention to it again because I was very curious:

How did he recognize this business model early on?

Was it purely luck?

Thus, I really wanted to find some books about Wang Ning or Pop Mart to read. But strangely, I forgot to search for books on Taobao and only found some snippets of Wang Ning's thoughts online.

After reading those snippets, I still didn't quite understand what Wang Ning was doing, and I questioned whether trendy toys could develop into a lasting business model.

So I once again lost interest in Pop Mart.

Later, I saw Duan Yongping repeatedly recommending everyone to read Wang Ning's 'Because Unique' in his Q&A sessions. This gave me a clue, so I immediately bought the book—finally, I found a reliable channel to understand it.

I have read this book twice so far, and I may read it a third time when I have the time.

Each time I read it, I gain different understandings and can see different perspectives, which has greatly benefited me.

Currently, most comments about Pop Mart (though I can't say "all") made by people likely haven't read 'Because Unique'.

Because the "confusion," "puzzlement," and even "absurdity" in those comments are essentially what Wang Ning considered and pondered over more than ten years ago, and after over a decade of exploration, he made choices and trade-offs that have led to where we are today.

Regarding Pop Mart, my understanding mainly consists of the following points:

1 Wang Ning is a long-distance runner; finding such entrepreneurs who can fight a "protracted war" is not easy.

So if you plan to invest in a company for the long term, this is a significant advantage for him and likely a key factor in building a competitive moat.

If you believe Wang Ning can lead Pop Mart to continue its success, you might understand why Duan Yongping says (in essence): Wang Ning is still very young and can make a lot of money.

2 Is there a threshold for Pop Mart's business model?

Wang Ning wrote his understanding of it in the book.

If you still don’t quite understand after repeatedly reading, you might want to think about how its competitors are doing.

Among foreign competitors, Wang Ning often mentions Disney and Sanrio.

However, I believe Pop Mart's business model is different from Disney's. Wang Ning has explained this point, and I think the distinction might be greater than he realizes.

As for Sanrio, I believe Pop Mart and it might not be in the same arena, although they appear similar.

So currently, none of these seem like its true competitors.

Moreover, even if foreign competitors emerge in the future, I find it hard for them to compete with Pop Mart. The reasons Wang Ning mentioned in the book are things he said many years ago. Those words have since been validated and continue to be validated, and I believe they will still be validated in the future.

So the real competitors for Wang Ning are more likely to come from within the country rather than overseas.

Among the many domestic competitors, there are quite a few, but few strong ones, with Miniso being one of them.

I think those competitors (like Miniso) are either not really in the same arena as Pop Mart or will struggle in the future if they continue on their current paths.

Because what those competitors are currently doing and their perceived business model were all attempted and decisively abandoned by Wang Ning during his early exploration—Wang Ning stated that he had encountered many pitfalls and believed those models would lead to significant troubles in the long run.

3 What is the value of trendy toys?

Wang Ning said it is called "the use of the useless." He explained what "useless" means and also clarified what "use" refers to.

He believes that the value of this "use of the useless" will grow greater as we move into the future.

At the time Wang Ning made this statement (based on the recorded interview dates in the book), there was no GPT, no AI. Now that AI has emerged, I think the value of his statement is even greater.

4 Regarding the value and price of the company.

You can look at Pop Mart's current free cash flow (net profit) and its current P/E ratio, roughly convert this P/E ratio to estimate its valuation, and then compare this valuation with the current market value to assess if it's worthwhile.

Additionally, try to understand Wang Ning's thoughts, Pop Mart's business model, and its competitive moat (which requires serious reading and repeated reflection, along with visiting its stores), to see whether you think its future free cash flow will be greater or smaller than today, and if this profitability is sustainable.

5 The potential of the Pop Mart arena.

I believe the potential of this arena is decent, but it is capped. At most, it serves a global population of 6 billion. This calculation can be reasonably estimated.

It definitely cannot compare to the AI market, where the potential seems almost limitless.

Thus, it doesn't seem like a "robust" arena.

6 Distinguishing "doing the wrong thing" from "making mistakes in the process of doing the right thing."

I think this point is very important.

If you really plan to invest in Pop Mart, understanding this will determine whether you can hold onto it during some temporary storms in the future. If you can hold it, you will enjoy long-term compounding; if you cannot hold it, you will just be a passerby.

How to distinguish whether these types of "errors" are "doing the wrong thing" or "making mistakes in the process of doing the right thing" depends on the values of the team.

And how to judge whether the team's values are "words meant to deceive" or "genuinely implemented disciplines" can be seen in Duan Yongping's Q&A.

Some time ago, Pop Mart launched the Labubu refrigerator. There was a lot of online discussion about its pros and cons, focusing on whether the refrigerator would drop below its issue price.

But I didn't pay attention to any of that, because I believe that even if this project was wrong or the refrigerator dropped below its issue price, it wouldn't significantly impact Pop Mart in the long run.

7 My biggest concern about Pop Mart.

The industry Pop Mart is in is quite unique, and in the current complex and changing environment, I believe it may face another type of special risk.

This risk, once triggered, can bring the company down in a very short period of time.

However, this risk can be completely avoided; it depends on whether the founder can realize it and take action.

I'm still uncertain whether Pop Mart will trigger this risk.

But I can't share this here.

Studying Pop Mart is quite interesting because, in my view, it is a new phenomenon with a lot of uncertainties and novel elements. To some extent, it represents a new attempt and exploration by Chinese enterprises.

No matter whether to invest in this company or not, 'Because Unique' is definitely worth reading.

This is my general understanding of Pop Mart, for reference only and not as any investment advice.

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