So, the current investors are eyeing our investment returns on NASDAQ and want to amend the contract—the old ones, the current ones, or the future ones?" He Zhengcheng asked upon returning to Shanhai Capital, where everyone, including Xu Xin, had already gathered.
"They want to amend all of them?" Ji Jiasheng asked.
"Why?" He Zhengcheng didn't get angry. Their company had been subject to various restrictions since its inception, which was partly due to their own overambition.
They hadn't yet achieved significant success. While past performance was excellent, Peregrine had collapsed, so were these scattered individuals really more outstanding?
Therefore, although they spoke of three hundred million US dollars, almost half of it was just for show. Using the funds would involve many complications, which was why He Zhengcheng faced various difficulties when investing in Silicon Valley.
"Yes, why?" Chao Yang echoed.
"Who are the people making these demands?" Yu Dehui inquired.
"Aside from Cheung Kong, several other major investors have made such demands. However, they promised to make up for the management fees, and they can increase the management fee percentage. They will also increase the investment amount in the next round and no longer restrict our use of the funds," Ji Jiasheng explained.
"Isn't this what we deserve? Has it become their charity? Or do they think we won't find a way out if we leave Hong Kong?" He Zhengcheng retorted.
"The major families in Hong Kong are used to being powerful!" Lv Lang commented.
"I don't want to know what pressures or concerns you have. There's only one rule: I will not agree to any of their demands. For continued cooperation, everything must proceed according to our rules. Furthermore, the company's information must remain confidential from now on; we will only provide limited notifications.
Khosla of KPCB was interested in our team and mentioned a three-hundred-million-dollar fund that he could entrust to us. I didn't agree.
If Hong Kong cannot accommodate us, Wall Street also needs investors like us who focus on Daxia Country," He Zhengcheng stated. At this moment, he showed neither anger nor anxiety; capital had always been this way.
The investment returns from eBay were too substantial, and because no one was willing to invest at the time, the funds for eBay primarily came from the He Family, Cheung Kong, and a portion of the discretionary investment quota. This portion of the funds was allocated based on overall returns, meaning the final outcome at the end of the investment period.
"What if they stop investing in us?" Ji Jiasheng asked.
"eBay can be cashed out, Cerent can be cashed out. NASDAQ is too hot; a bubble has already formed. We just don't know when it will burst, so we can wait and see," He Zhengcheng replied. He had no plans to do venture capital this year anyway.
Shanhai Capital's shares in eBay were divided into two parts: half belonged to Yang Zhiyuan, the chief of Yahoo, because it was through his connections that they had the opportunity to invest in eBay. Therefore, only a small portion of these investment returns belonged to them.
The other half, approximately 1.11 million shares of eBay, belonged to Shanhai Capital. At eBay's current price of 235 US dollars, cashing out would yield 260 million US dollars. The contract they signed had a maximum investment period of three years, meaning these funds could be reinvested repeatedly within three years.
"Why aren't those who benefited helping us?" Xu Xin wanted to know Cheung Kong's stance.
"Perhaps they also want to get more," Lv Lang speculated. Cheung Kong invested 5 million US dollars in this project, and their share of the profits before distribution was 500 million Hong Kong dollars—no small sum.
"This news is really disappointing!" Yu Dehui exclaimed. After cashing out the eBay project, the six of them combined were expected to share over 1 billion Hong Kong dollars. Even with He Zhengcheng taking a larger share, each person's profit would exceed 100 million. Now, to have food snatched from their mouths, who would be willing?
He Zhengcheng was actually quite skeptical about the possibility of this happening. Those investors should have at least a decade of experience; would they be so short-sighted, disregarding the existence of contracts and credit?
But he was, after all, inexperienced and couldn't discern much. Fortunately, the Google project was in his own hands.
"Then let's refuse. Should we hold an investor meeting?" Ji Jiasheng suggested.
"And celebrate our achievements this year at the same time?" Chao Yang added.
"Yes, and we can announce our new policies for next year," He Zhengcheng agreed.
"We also need to analyze the investment environment for next year," Lv Lang stated.
"Let's follow the normal procedures!" Xu Xin said.
"The companies we invested in will all go public in the next two years. If we don't finalize things now, we might face even more complex situations then," Yu Dehui pointed out.
"Understood, we will not compromise this time," Ji Jiasheng affirmed.
After discussing business, everyone started chatting. He Zhengcheng had a lot he wanted to say to everyone, but with this situation, he lost the mood.
"Have you decided what to do about your USB drive?" Chao Yang asked. Back then, a patent lawyer from Silicon Valley came to the University of Science and Technology to handle patent applications, and Chao Yang helped a lot.
"The patent has been applied for, and it's basically confirmed that there are no similar products on the market. If I really establish a company, internationally I can use Compaq's channels, and domestically, if Lenovo helps, I can also use their channels.
The problem is that once I start a business to create an electronic product brand, there will be many difficulties, and my time will be hard to allocate," He Zhengcheng explained.
"Then sell the patent?" Yu Dehui suggested.
"My investments combined are only 4 million. What price could I sell it for? My target price is 10 million US dollars, and it would be best if it were a Daxia Country brand, but their boss might not have that kind of courage," He Zhengcheng mused.
"Ten million US dollars, which is about seventy to eighty million Daxia Country currency. To buy a patent for that much money, they really might not have the courage," Yu Dehui agreed.
"However, according to my calculations, USB drive technology is relatively simple and easily copied. This is naturally a tragedy for small businesses that lack money, but for large businesses that don't lack money but lack fame, it's the best choice.
If Lenovo buys this patent, it would be extremely cost-effective for them. If I sell it to large European and American companies, I do have the channels, but I might not get a good price, probably around five to six million US dollars," He Zhengcheng elaborated.
"This is indeed quite difficult to handle!" Lv Lang admitted.
"Forget it, if it really doesn't work out, I'll start a company myself. After building up the brand, I can always sell it off," He Zhengcheng said, half-jokingly.
"How about we pay a visit to Liu Chuanzhi?" Xu Xin proposed.
"We could, but I really don't think it's very likely," He Zhengcheng responded.
"There's no harm in meeting. Everything is negotiated!" Ji Jiasheng encouraged.
"Alright, let's see when he's available. By the way, which other companies have we invested in in Daxia Country?" He Zhengcheng asked.
"At Lenovo's introduction, we invested in Kingsoft Software," Xu Xin informed him.
"What about UTStarcom?" He Zhengcheng inquired.
"We've already made contact; many people are interested in investing," Yu Dehui said.
"So their PHS system succeeded?" He Zhengcheng asked.
"Who knew such backward technology would actually have a market!" Yu Dehui exclaimed. The legend of the PHS system was just beginning, why rush? "How is Zhonghua Net progressing?" He Zhengcheng was very curious.
"It has already been established, and user access is growing rapidly," Lv Lang replied.
Oh, so there aren't many users, he could still understand that meaning.
"Are there plans for an IPO?" He Zhengcheng asked.
"It's currently being planned…" Lv Lang responded.
It seems they still lack experience. For a company with such inherent shortcomings, going public to raise money, its subsequent development is not the concern of venture capital…