Finally, Lin Bin agreed to Chen Pingjiang's invitation.
It wasn't because Chen Pingjiang promised him a 5% stake, nor was it due to the rosy prospects Chen Pingjiang painted for him.
Instead, it was a particular statement that moved Lin Bin:
"All chip-level hardware is in the United States, with one PC operating system, two mobile operating systems, and even server systems all originating from there. Database systems, encoding and compilation systems are no exception, along with a series of design software. I believe we should also have our own; they might not be the best, but they would be enough to boost our confidence."
Some things Chen Pingjiang didn't say, Lin Bin would know when the time came.
After persuading Lin Bin to join, Chen Pingjiang only needed to find someone to handle mobile hardware.
The chosen candidate was ultimately Zhou Guangping.
Currently, Zhou Guangping serves as a Senior Engineer at Motorola.
It took Chen Pingjiang a considerable amount of time and effort to secure Zhou Guangping.
After the discussion, Chen Pingjiang couldn't wait to rush back to Dongjiang.
Upon meeting the Dongjiang leaders, Chen Pingjiang stated directly,
"I want to make mobile phones."
For the Dongjiang leaders, was there any sweeter sound to be heard?
Before long, both sides finalized a series of land and tax preferential policies.
Once Lin Bin and Zhou Guangping finish their resignation procedures and arrive in Dongjiang, the mobile phone project will officially commence.
When he wasn't making mobile phones, Chen Pingjiang felt quite rich.
But when he truly wanted to make mobile phones, he realized that his current funds were really not enough.
To be honest, factory buildings, machinery, equipment, and labor costs were all minor expenses in comparison.
Subsequent supplier stocking, patent authorization, or acquisition would be the major costs.
Meizu and HTC are both examples of failure.
Especially HTC.
Since its brand's inception, HTC's primary market focus has consistently been overseas, with relatively fewer adjustments made for the domestic market.
This led to a series of issues in the domestic market, and comparisons of HTC's domestic and international pricing and after-sales service have always been quite controversial.
However, HTC seemed not to take these much to heart, failing to implement continuous, stable improvement efforts and continuing to invest the vast majority of its energy and capital into promoting overseas markets.
Unfortunately, HTC lost in Apple's patent infringement lawsuits in 2010-2011, and a large portion of its best-selling models were banned from sale in the U.S.
The severe setback in overseas markets directly led HTC to suffer four consecutive quarters of losses.
And when HTC sought to shift its market focus back home, most users, completely disillusioned with HTC, had already moved to purchasing other mobile phone brands.
The young HTC was like a comet, quickly sinking.
It was fiercely battered by a sea of patents from its rivals in that tech war.
Foreign companies are most adept at this.
If you don't have patents and I do, either I fleece you and you pay up, or I sue you until your products are banned.
If I have patents and you also have patents, then we'll conduct fair transactions first.
If fair transactions can't eliminate you, then I'll lobby congressmen to suppress you.
After returning to the company.
The team from the US side had already arrived, and the first phase of preparatory work was to deal with the American team's review.
The US underwriters' lawyers, Renrenwang's US lawyers, and US auditors are the most important roles among them.
IPO due diligence, led by US underwriters' lawyers, is aimed at preparing the IPO application form, with lawyers handling the entire process of professional document submission and review.
Drafting application materials, which include the prospectus, Form F-1, Form 20-F, and other documents under Regulation S-K, with the prospectus being the most critical to draft.
Cooperating with auditors to complete the annual audit, and passing it to obtain a standard opinion audit report, significantly increases the success rate of the IPO.
At this stage, internal and external communication and coordination, as well as team execution, are most important, which also reflect the expertise of an excellent financial advisory team.
The entire process takes approximately one month.
Once this step is completed, the IPO application can be submitted.
...
"Xiao Chen, the city's document has been issued to Wujiang District, requesting our full cooperation with your company's factory establishment and production."
Yan Liming had quite a bit to drink; he was happy today, his face flushed.
District Chief Yan is currently very popular in Dongjiang City, especially with rumors that Chen Pingjiang plans to make mobile phones, which has garnered special attention from higher authorities.
Such high-tech companies have a significant stimulating effect on the local economy, capable of maximizing employment rates and even helping Dongjiang develop a mobile phone supporting industry.
Chen Pingjiang nodded,
"The CEO of the mobile phone company I found will come to Dongjiang in half a month. I'll have him coordinate with your side then."
The decision not to choose contract manufacturing but instead to build his own factory was also made by Chen Pingjiang after careful consideration.
This means Chen Pingjiang and Lei Jun's Xiaomi have taken two different paths.
The latter adopted an asset-light business model, defining himself as a service provider; opening his own factory does not fit his model, and his own set of principles does not allow him to open a factory.
Xiaomi phones' most adept marketing model should be "hunger marketing."
Each new product launch involves pre-sales, similar to Apple phones, with limited quantities.
If you can't grab one in the first wave, you have to wait a while before you can buy it again.
Xiaomi's hunger marketing is not independent; it's inextricably linked to its production and procurement.
Xiaomi typically seeks out contract manufacturers with excess capacity or waits for factories to finish orders for other manufacturers when there are no new orders to accept, which allows them to drive down prices significantly, though this method results in relatively low production capacity.
Therefore, Xiaomi building its own factory would not be in its own interest and would instead lower its profit margin.
But Chen Pingjiang believed that having his own factory could maximize the guarantee of product quality and production pace.
Most critically, as a newcomer to the mobile phone industry, with small production volumes, contract manufacturers would either demand high prices or push his orders to the back, making production capacity impossible to guarantee.
Li Yuhua just saw that there weren't many dishes left on the table, so she ran to the kitchen to make a smashed cucumber dish, bringing it to the table now, while grumbling,
"This Yan Yan has been talking about starting a business lately; I think she's gone crazy. She rarely comes home. Look, Xiao Chen is here, and she doesn't even know to come back and keep him company."
Speaking of his daughter, Yan Liming also frowned,
"I heard you invested ten million in her? Isn't that just foolishness? She studied journalism, does she think she can start a business after interning at Renrenwang for a few days? You're spoiling her too much."
Yan Liming thought very clearly.
Chen Pingjiang is already so busy; if he marries a wife who is even busier than him, and the couple are so busy they don't see each other for months, how will their relationship be maintained then?
In his view, once they marry, with Chen Pingjiang providing for the family, they won't have to worry about food and clothing for generations.
Yan Yan should focus more on taking care of the family and children.
This is not male chauvinism.
Rather, it's a choice and compromise that must be made for family harmony.
One internal, one external is best.
Li Yuhua also chimed in,
"Ten million yuan, your Uncle Yan and I would have to work for almost a hundred years without eating or drinking to earn that. If she loses it, I won't be able to sleep at night."
Chen Pingjiang chuckled,
"It won't come to that. There are also a few employees from my side over there, and they'll report any issues to me. Since she wants to start a business, just let her try. Don't you know her personality? She gets bored easily. Having something to focus her energy on is also good."
"If you're worried about her being too busy, I can find a professional manager to run it for her then, or simply acquire her company directly."
After eating, Chen Pingjiang and Yan Liming hid on the balcony, puffing on smoke and drinking tea, enjoying themselves leisurely.
Yan Liming sighed,
"Regarding Yan Yan starting a business, I actually talked to her about it. Although she doesn't say it, I know she's doing this because she wants to keep up with you. But if we insist, she would definitely give up her own ideas."
"Uncle Yan, I didn't overthink it, otherwise I wouldn't have supported her so much. After all, she's still young; it's good for her to try things out."
...
Half a month later, Chen Pingjiang finally met with Lin Bin and Zhou Guangping in Dongjiang.
Chen Pingjiang led the way, taking the two to visit his various business groups.
After the tour, Lin Bin remarked with considerable emotion,
"I originally thought Renrenwang was only strong in social networking, but I didn't expect it to be so powerful in other aspects as well."
Zhou Guangping also nodded,
"The data center, talent cultivation, and that Renren Iron Army training camp all shocked me."
Chen Pingjiang also spoke candidly,
"Both of you are my seniors. I previously discussed my vision for mobile phones and the ecosystem with you in BJ, but today I'd also like to talk to you about my thoughts on the company itself."
"?"
"In the future, the mobile phone company should not pursue an IPO, because I will focus on R&D, which requires substantial capital investment, rather than just thinking about producing assembled products and relying on operators for profits. Shareholders would not approve of such large capital investments after an IPO."
Lin Bin nodded in agreement,
"I have no problem with that. Since I came here, it wasn't just for money. Everyone knows the disadvantages of going public now; shareholders only focus on short-term profits and have low willingness for long-term investment. Actually, I guessed this when you planned to build your own factory. It's good not to be constrained by capital interests."
Chen Pingjiang turned his gaze to Zhou Guangping, wanting to hear his thoughts.
Zhou Guang smiled and said,
"Don't look at me, I'm over fifty and will retire in a few years. If I can make a good mobile phone before retirement, I'll be satisfied. If we truly focus on R&D, then going public isn't very suitable, as it allows us to maintain technological independence and avoid external interference."
Lin Bin then asked,
"But if we don't go public, it means you, Mr. Chen, will have to continuously 'transfuse blood' until the mobile phone company can be self-sufficient. Are you ready for that?"
"Haha, I'm certainly ready. Renrenwang was already valued at 3.5-4 billion USD during its B-round financing, and this IPO should at least double that. Renren Shopping will also go public in the future, and I am willing to continuously 'transfuse blood' into the mobile phone company."
From the moment he decided to make mobile phones, Chen Pingjiang had no intention of accepting a single penny from other venture capital firms; the money from the IPOs of his internet and catering companies would be enough for him to spend.
(End of Chapter)