[Chapter 15: Gathering of Titans]
After finishing the meeting, everyone got themselves ready and finished lunch. The Yahoo! garage was unusually quiet; obviously, everyone at the company understood the significance of the upcoming negotiation.
Jerry Yang and the others felt a bit nervous, including John. After all, in his previous life he was just an ordinary guy. Now, they were all about to face some heavyweight players in the business world. If John could remain calm through it all, that would've been surprising.
Likewise, Jerry and the others, who were students just two months ago, were bound to feel the pressure going up against such business elites.
In fact, this round of financing discussions had caught the attention of the entire venture capital community, and Silicon Valley as a whole. Since announcing their intent to accept venture capital, Yahoo! had become the buzzword of the Valley.
Their recent performance was simply outstanding. Yahoo! had become a benchmark on the internet -- almost everyone who went online visited Yahoo!. Membership had already surpassed 2 million, with close to ten million page views daily.
Their competitors were left completely powerless. It was worth remembering that before the revamp, Yahoo! faced many rivals online. But ever since launching their redesigned portal, traffic to many competitors had sharply declined.
Yahoo!'s progress, fueled by John's early involvement, had surpassed last life's performance by a mile -- advancing development by at least a year, possibly more. This was definitely the biggest impact John, like a butterfly in this world, had stirred so far.
Just a few days ago, Yahoo! had put forward a valuation of $500 million, a number that spread shockwaves through the venture capital and Silicon Valley circles. Many said Jerry Yang and the team had lost their minds.
How could anyone put forward such a crazy valuation?
In fact, many publicly traded companies didn't even have a market cap of $500 million. Thinking about it, people could easily see how insane Yahoo!'s valuation looked from an outsider's perspective.
And at this point, Yahoo! was still less than 20 people strong, cramped into a modest 1,100-square-foot garage office. The official founding of Yahoo! was barely two months old -- making all of this truly unbelievable.
Because of this, all of Silicon Valley was watching the first round of Yahoo!'s financing talks today. Many were actually waiting to see Yahoo! fail spectacularly.
---
At 1:30 p.m., as multiple cars pulled up in front of the Yahoo! garage, a stir ran through the company -- it was clear the venture capital representatives had arrived.
The original plan was to hold the meeting at a hotel, but the VCs insisted on conducting negotiations right at Yahoo!, wanting to see how this internet sensation operated firsthand.
Jerry Yang arranged for the necessary staff and led the group to the garage entrance to greet the investors.
John followed Jerry out the door and immediately spotted several people getting out of their cars -- including Michael Moritz from Sequoia Capital, whom they'd met just a few days before.
Jerry stepped forward toward the group, followed by everyone else exchanging greetings and introductions. John's presence, at only 15 years old, certainly turned heads -- he looked out of place among such figures.
The venture capital reps were all big shots. They stunned everyone at Yahoo!.
For example: Sequoia Capital's founder Don Valentine and second-generation leader Michael Moritz; John Doerr, founder of Kleiner Perkins Caufield & Byers; Steve Case, chairman of America Online (AOL); Tim Draper, founder of Draper Fisher Jurvetson; John McGovern, chairman of International Data Group (IDG Capital's parent); and Andy Grove, president of Intel and Intel Capital, all had shown up.
They also had a posse of assistants in tow. Today's gathering at Yahoo! was seemingly the most heavyweight assembly in the history of American business.
...
Having so many giants at Yahoo! was unprecedented. Normally, ordinary venture capital couldn't gather these leaders, no matter how high the investment.
But Yahoo! had broken new ground, introducing an internet profit model that captured their interest -- and that was key.
These big shots were all world-class business leaders, who saw the unparalleled potential in Yahoo!'s free "content + traffic + advertising" business model. That was the primary reason for their visit.
Realizing the vast future ahead for the internet, naturally sparked their curiosity about the company that had first proposed such an approach. That's why all these powerhouses had gathered.
It was also a major reason why these capital giants didn't immediately reject Yahoo!'s $500 million valuation, but decided to sit down and talk it out.
---
As introductions wound down, everyone at Yahoo! was left dumbfounded.
It made sense though - -these leaders were global business icons. But their sudden intense interest in Yahoo! stunned even the company, and John, too.
"Wow, even Your Highness is impressed?" Michael Moritz joked as he walked up to John.
Michael's playful comment brought John back to his senses.
"Michael, what's with all these big shots showing up? Are we really that important?" John asked.
Michael laughed. "Nothing special, just a lot of curiosity about Yahoo!. So by chance, they all came. Believe me, I was surprised too when I first saw it."
In truth, John had underestimated Yahoo!. Looking ahead, even after going public, Yahoo!'s stock rose despite massive losses.
Though the dot-com bubble was part of it, this showed how much people valued Yahoo! -- the pioneer of an internet profit model.
VCs appreciated disruptive companies. For example, Apple: founder of personal computing.
Yahoo! was the pioneer of entry-level internet sites: a portal site. The originator of the internet's free "content + traffic + advertising" revenue model, opening the door to internet profitability, setting history.
...
John exchanged glances with Jerry Yang, David Filo, and Tim. Then he stepped aside as the three gathered around.
"Everyone, looks like we underestimated our own Yahoo!. We've been doubting our influence. So, for the next talks, we have to hold firm on that $500 million valuation. Even if we have to compromise, not by much," John said firmly.
Right as he finished, their eyes lit up -- exactly! If Yahoo! wasn't valuable, those giants wouldn't be here.
The four shared a knowing smile and nodded. Then they stood ready to accompany the VIPs inside.
*****
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