Reinventing the Millennium.

Chapter 279 One Money, Two Uses (Two in One)

The five venture capitalists confirmed their intention to invest in Yike's A round, and the most important thing was resolved.

With regard to the amount of shares to be released and the standards for company valuation, these are small details of confrontation and discussion, which cannot be settled in one case, but they are not the main contradiction.

After the angel round and the PreA round of financing, Yike’s shareholding structure is 57.5% by Fang Zhuo, 12.5% ​​by Yu Suzhou’s three senior executives, 13% by IDG Huaxia, 9% by Capital Today, and 8% by Shenxin Kechuang.

According to Fang Zhuo's original plan for this round, 20% will be released, while IDG America said a year ago that it would be 30%. There is a big difference in the opinions of the two parties.

Now with the launch of the software iMusic, with the initial praise from users, and with the real practice of software and hardware integration, IDG America has made concessions, otherwise the newly introduced Xiangjiang Huanyu will not be able to take its share and provide sufficient of funds.

According to the financing of most companies, the situation of the A round generally needs to verify the business model and profit method, but the situation of Yike is special, no matter whether it is domestic or foreign, there is no competitor for the time being, which makes its hardware products have entered the profit stage.

However, the digital new media proposed by Fang Zhuo belongs to a new business model, which needs to accumulate users to obtain copyright authorization and then verify it, which is more in line with the A round of financing in the conventional sense.

In other words, Yi Ke is now a bit between A and B.

"Actually, if it wasn't for the software ecosystem, we would have sufficient funds. The money raised in this round is mainly used to deal with music companies."

"You should also be aware that the copyright cooperation of music companies is difficult to sign year by year."

"It's not that I want money, and I don't cash out."

"This is because Yike needs money. It needs money to solve the problems it faces at this stage. If money is not enough to solve the problem, what's the point of asking for money?"

The president of Yike expressed his views on the use of funds, while the five institutions were involved in some debates on how to value the company, whether to use P/S, EV/EBIT or PB to judge the value of Yike.

As of the PreA round of financing, the market value of Yike was estimated at about 3000 million U.S. dollars. However, with the sale of the M1, Sony offered a purchase price of 5000 million U.S. dollars.

Now, the sales and channels of music players are much stronger than at that time, and there is feedback from the launch of iMusic, the price is no longer the same.

A meeting did not resolve the issue of VCs' valuation of Yike.

Two meetings, still unresolved.

But Fang Zhuo is not worried about this. As he said, as long as the funds can cover the copyright authorization of the company and the music company, the temporary amount is not the most important issue.

In this way, two more meetings were held, and the venture capital institution asked the president of Yike who had not expressed much opinion on valuation.

"Doubling is a little bit, and you are not happy to double."

"Everyone is optimistic about the development of Yike. It just so happens that Mr. Miller understands Chinese culture. How about this? Let me say a number. Everyone should study and study, whether it is valuation according to your procedures, or whatever."

"8888 million, how about making it auspicious?"

Unlike the tirade at the first meeting, Fang Zhuo simply gave his own opinion, doubling is 6000 million, quadrupling is 4 million, this 1.2 million is basically three times the middle number .

Except for Miller, everyone else looked at each other in blank dismay.

In Miller's perception, this is a kind of oriental belief. He thinks it is an acceptable value. After these four days of discussion and debate, there should be a compromise between each other. It just so happens that the number mentioned by the founder contains a kind of Oriental mystery.

He said directly: "This number is slightly higher than the valuation of the EV/S indicator, but it is also within my acceptable range. Bear, I think it is okay, what do you think?"

It is not Xiangjiang Huanyu who insists on high valuation these days, but Xiong Xiaoge of IDG Huaxia, because he already holds 13% of the shares in his hands.

Xiong Xiaoge did not give an answer immediately. He discussed with his team for a while before agreeing to the valuation figure.

The two most controversial IDGs reached a consensus, and the work of this step will proceed.

Soon, the investment amount and equity distribution plan will be fully released.

IDG America invested US$1600 million to hold 18% of the shares, while Xiangjiang Huanyu invested US$500 million to hold 5.3% of the shares.

IDG华夏追投170万美元由13%削减至11%，今日资本追投80万美元由9%削减至7.3%，申新科创追投50万美元由8%削减至6.4%。

Fang Zhuo's shareholding was reduced to 40.25%, Yu Hong and Su Wei's shareholding was reduced to 3.85% each, and Zhou Xin's shareholding was reduced to 1.05%.

In addition, set up a 3% option pool.

That is to say, IDG USA became the second largest shareholder of Yike Company.

Considering that the two IDGs only accounted for 29% of the total shares, which did not reach the minimum line of veto by one vote, this made Fang Zhuo quite satisfied, and this round of external financing totaling 2400 million US dollars can also make Yike full of strength. forward momentum.

"Fang, in the next 12 months, we will face all kinds of challenges. How likely do you think we will fail?" Miller mentioned the issue of risk expectations after finishing the investment subject and leaving only details.

Fang Zhuo said to both Miller and everyone present: "I think in the next 12 months, what we need to consider is success or more success."

Miller grins. He likes founders who are confident.

Xiong Xiaoge and Fang Zhuo had known each other for a long time, and they were already somewhat immune to his aura, so they pulled the corners of their mouths reluctantly to save face.

Pan Ben was the one who admired the boss the most, not only because he went to the warehouse to carry the goods in sweat, but also because he followed Fang Zhuo all the way to watch him operate.

Hearing this, he guessed that the atmosphere was appropriate, and applauded first.

Immediately there was applause in the conference room, and those present were those who hoped that the company would be more successful.

如此，申城易科科技于2002年4月5号完成A轮融资意向，由海内外5家投资机构合计2400万美元认领27%的股权。

In other words, Yike completed the company's valuation increase from the PreA round of US$3000 million to the A round of US$8888 million.

The third round of financing ended without champagne and a celebration dinner.

The contract needs to be reviewed and approved according to the law, because Shencheng Yike actually adopts the VIE structure to hold shares, and when it comes to compliance with the legal provisions of the two countries, professionals must study repeatedly to avoid any mistakes.

At the end of the fifth financing meeting, Fang Zhuo invited IDG Huaxia and Xiangjiang Huanyu to have a meal before they returned to China.

During the meeting, he didn't talk about the iMusic digital new media that he had talked about before, and he didn't talk about music copyright authorization. He talked about hardware cost reduction and channel construction throughout the whole process.

Liang Qihua from Xiangjiang Huanyu listened cheerfully at first, but then he asked a little puzzled: "Mr. Fang, what are your plans for iMusic in the near future?"

"Oh, don't worry about that." Fang Zhuo said casually after drinking half a glass of beer.

Liang Qihua became anxious: "Why don't you worry? Didn't you keep talking about this in the meeting?"

Fang Zhuo nodded: "Yes, foreigners like to hear this."

Just as Liang Qihua was about to explode, he suddenly saw that Xiong Xiaoge was very calm, and turned his head to see what he meant.

Xiong Xiaoge summed it up leisurely: "Hardware is the present, and iMusic is the future. If the hardware is not good enough, what are you talking about about iMusic? Mr. Fang's focus is fine."

Liang Qihua's mood eased a little.

Fang Zhuo corrected: "iMusic is not the future. The combination of hardware and iMusic is the future. The profit of hardware products is very considerable. Mr. Liang, don't follow the advice of foreigners. He may not know as much as you."

Liang Qihua: "..."

Mr. Fang seems to be praising himself, right?right?probably?
He caught a glimpse of Xiong Xiaoge where the old god was present, and he didn't know if this person had communicated with Fang Zhuo in private or if he was really astute.

"Don't worry, Mr. Liang, I am the person in the world who most wants to do a good job in Yike, and I know it well." Fang Zhuo said with a smile.

Xiong Xiaoge raised the wine glass in his hand and said loudly, "Come on, let's drink to Mr. Fang's understanding."

Liang Qihua then raised his wine glass, but felt that the toast contained a gun and a stick was a bit strange.

Fang Zhuo drank a glass indifferently, and after everyone's glasses were filled, he said loudly, "Come on, let's drink to change the world!"

Liang Qihua toasted again, a little amused in his heart, is it okay to change the world?

However, this toast was a little more comfortable.

After the meal, Xiangjiang Huanyu went back home, while Xiong Xiaoge stayed in New York for one more day. He spent half a day simply strolling around the Kroger supermarket in this international metropolis, and spent half a day talking with Fang Zhuo. Had a business discussion.

Xiong Xiaoge also found the way of channel sinking quite new, but from Fang Zhuo's mouth, he heard a more profound analysis.

"Channel sinking is not a short-term strategy, but a medium and long-term strategy."

"It's already April, and I heard that Apple will hold a product launch event early next month. If the forecast is good, they will definitely support Microsoft's Windows this time, and the M1 will not be so comfortable at that time."

"However, no matter whether it is iTunes or iMusic, music licensing is not easy to achieve in the short term. Music companies will not be easily shaken until they see the accumulated user volume. This is a process."

"What Yike and Apple have to do is to continue to increase their stake in the market. From this point of view, the two companies can be said to be horns of each other."

Although Xiong Xiaoge couldn't understand some of Fang Zhuo's behaviors, he always admired his views on combining the industry and was always moved by them.

It was very late that day, and it was so easy to send the president of IDG Huaxia away. Fang Zhuo looked at his phone and it was already 11:30. Called the sleepy Kong Yu over.

"Recently, you don't have to follow Mr. Yu anymore, I'll take your place."

Kong Yu's sleepiness was half gone, and he speculated about the boss's arrangement in his heart.

"Recently, you secretly searched for a bank in the United States that can pledge equity, and pledged all the equity in Yike in my hand."

At this moment, Kong Yu lost all sleepiness. He was dazed for a while, and asked, "Fang, Mr. Fang, are you going to pledge all of this just after financing?"

"Yes, all of them. The price is negotiable." Fang Zhuo said lightly, "The money can just be used to operate the shares of Sina, and the money can be used for two purposes to maximize the use."

Nothing impassioned, nothing gnashing of teeth.

But Kong Yu immediately felt the boss's determination and murderous intent towards Sina's hostile takeover.

He swallowed involuntarily, and the five points of doubt in his heart that the boss wanted to cash out and leave the scene were reduced to one point.

Kong Yu pondered for a while, and reminded: "Mr. Fang, since Yike has not yet been listed, the equity liquidity is not high, and it has just completed the A round of financing. The price may be lower than ordinary equity pledges."

Normally, equity pledged funds can get 3% to 6% off the original value depending on the situation. However, the value determination of non-listed companies is not clear enough, the market transparency is not high, and there are relatively few buyers, so the price will be low.

"It's okay to be lower, the most important thing is to keep it secret." Fang Zhuo glanced at Kong Yu.

Kong Yu was swept away by this glance, as if gasoline was poured on his body again, and his scalp was numb.

He knows the importance of this secrecy. If those VCs who have just invested hear about this, it must be a big disturbance.

"Understood, Mr. Fang." Kong Yu took a deep breath and realized that this was a challenge in his work. Unlike in China, where the former vice president can easily find a relationship, it is necessary to find a bank that can provide funds in the United States. Avoid IDGs.

This involves the confirmation of equity, and a small part of it that has been pledged in China.

Originally thought that as one of the directors of the MIGA Fund, he would help Mr. Yu do some Yike work in his spare time, but unexpectedly, a heavy burden was suddenly thrown over him unexpectedly.

The salary is really not that good.

"Remember, it must be kept secret, and the price should be as high as possible. The shipment volume of our products in the market is constantly increasing, and the book funds are also abundant." Fang Zhuo pondered, "You can also talk about our domestic products. blank market."

Kong Yu nodded.

He briefly confirmed a few items with the boss before getting up and leaving the room.

At the moment when the door was closed, a thought suddenly popped up in Kong Yu's mind, if this matter was leaked, would he still be able to return to China?

In the past two days, the black chamber of commerce in Chinatown has come to find the boss, but they haven't talked much because they have been busy with financing.

Kong Yu rubbed his face and walked back. If there is any difficulty, he must go up, if there is no difficulty, he must go up if there is no difficulty. The boss just finished the A round, and in a blink of an eye he prepared money to go to Sina. If he didn't know the situation clearly, he would have thought that the The founder of Sina, Wang Zhidong, is a relative of the boss.

In the early hours of the morning, Kong Yu didn't feel sleepy at all, thinking about the implementation of the new job.

In the morning of the next day, after Xiangjiang Huanyu left New York, the IDG Huaxia team also left the country with Xiong Xiaoge. Overseas Yike continued to work as if nothing had changed.

In the afternoon, Yike President Fang Zhuo held a video conference with overseas departments and personally described the work goals for the entire April.

"This month, we are doing channels, stabilizing supply, and receiving iMusic user feedback, and we don't need to talk about anything else."

"In March, our sales in the United States were close to 3 units, and the M5 and P1 were almost evenly split. This month, we strive to double this volume."

"There will be team performance bonuses for different goals, everyone should work harder."

"Also, there will be some new colleagues starting this month, so be careful to bring them with you."

When Fang Zhuo talked to his employees, he didn't talk about ecology or ecology.

At the end of the meeting, Yu Hong asked Fang Zhuo a question: "What's the situation with Kong Yu? I called him and said he was sent away by you?"

"Oh, he has other things. I'll take his place. I can't just say no. Recently, I followed Mr. Yu to see the construction of our channel. Is there any problem?" Fang Zhuo replied casually.

Yu Hong was a little surprised, nodded and smiled and said, "Okay, then I will also set the performance for the CEO."

　I also went shopping, and read movies and novels. This holiday is not bad, and the accounts are cleared, and there are still 3 chapters left.

　　
　
(End of this chapter)