Investor That Can See The Future

Chapter 78

James had a big influence on me in making this decision. He served as CEO for several decades, enabling Golden Gate to grow into a global IB.

If you think about it, a leader doesn’t necessarily have to lead with great talent. Rather, it is more important to put the best talent in the right place.

Although he entered the automobile industry out of antipathy to the silver car, he would not have dared to do so if Karos did not have the core technology.

Karos has excellent technology in artificial intelligence, autonomous driving, and car OS. To stay ahead, Karos must lead the industry by going beyond subcontracting or collaborating.

Also, Carlos is an American company, and Daryl is an American. It would be easier to show that it is an American automobile company if it is acquired and operated by an American company, Carlos, than if OTK Company, an investment company, acquires it directly.

After hearing Daryl’s answer, I said as if I had waited.

“We will increase our Karos capital to $20 billion.”

At the time of my acquisition, Karos was worth less than $100 million. After that, thanks to the advancement of artificial intelligence for automobiles to the commercialization stage, it is now estimated at over 1 billion dollars.

However, he declared that he would increase the amount equal to 20 times that amount.

Sergei asked, confused.

“Then what is the stake?”

Management, including Daryl, owns a 14 percent stake. Everyone gathered here has a small share of Karos.

“We will guarantee a 4 percent stake for the management team.”

The capital is increased by 20 times, but the ownership ratio is reduced to less than a quarter. This meant that the actual value of the stake increased by more than five times.

Wouldn’t it make sense that a 4 percent stake in a billion company is worth more than a 14 percent stake in a billion company?

“Do you have any objections?”

No one objected.

Needless to say, the company quickly became a company worth over $20 billion, and the value of its holdings had doubled, so there is no reason to object.

I remembered Yeji I had seen before. Before investing, I predicted that Karos would become a company worth over $10 billion.

And by investing, I actually became a company of over $10 billion. It is a kind of self-fulfilling prophecy.

I looked around the executives and said.

“Everyone here will lead the American automobile industry. Please do as well as you are now. I will spare no effort to support you.”

And I added a word.

“Ah! I would like to ask you to keep it a secret for the time being that I am the CEO of OTK Company.”

* * *

The executives left, and Daryl stayed for a while.

“I didn’t know you would make such a decision.”

“Sorry. We should have discussed it beforehand.”

I reached out to him and said.

“I wish you all the best in the future.”

Daryl said with his eyes shining.

“I will definitely repay your trust.” Taek-gyu spoke in Korean.

“Aren’t the owners supposed to shoot something in this case?”

“Five!”

That’s a good idea I hadn’t thought of.

“What are you going to shoot?”

“Pizza for Americans.”

I nodded and told Daryl.

“As a token of encouragement, I would like to buy a pizza for the employees. Are there any good pizza places around here?”

Then Daryl said without hesitation.

“The best pizza in Silicon Valley is, of course, M Pizza.”

Hearing this, Taek-gyu was startled.

“It’s a company we invested in.”

“right.”

M Pizza, which started in Silicon Valley, is expanding its branches throughout California and other states.

If you come all the way here, should you try it?

Daryl immediately gathered the staff through an in-house broadcast. The employees stopped what they were doing and gathered in the lobby on the first floor.

There, Daryl recounted what had just been decided at the meeting.

“With the support of OTK Company, Karos decided to take over an automobile company and make the car himself! From now on, we will lead the global automobile industry!”

“Wow!”

At his words, the staff applauded and cheered.

I installed the app on my phone to order M Pizza. Taek-gyu said while counting the number of his employees.

“I’m going to have to make 200 copies.”

“·················ogue.”

Isn’t there a shareholder discount?

* * *

Full-scale negotiations between the OTK Company and the Michigan State Government have begun.

Naturally, the negotiation was up to Hyunjoo noona.

The older sister served as the governor while negotiating various matters with state officials.

Closed factories and ruined sites were scattered throughout the Rustbelt, so the hilt was as if it were holding it.

Hyunjoo noona made it clear before starting negotiations.

“If support is insufficient, we will make additional investments in other industrial areas around the Great Lakes, not in Detroit.”

Considering the symbolism of Detroit, the headquarters and important production base are planned to be built here, but other factories may be built in other areas of the Rustbelt.

The state of Michigan was desperate to get the most out of the deal. All kinds of support measures such as free rental of factory sites, expansion of infrastructure, and tax support were presented.

When a manufacturing plant is built, employment increases, and when employment increases, there is no need to pay unemployment benefits. When a company makes a profit, corporate tax can be collected, and income tax can be collected on wages paid by a company to its workers.

Numerous positive additional effects can be expected, such as revitalizing the local economy and rising real estate prices.

While Hyun-joo’s older sister was negotiating fiercely with the provincial government, we continued to search for acquisition targets.

There are many car companies and brands for sale.

There are several automakers in the US, but the big three are by far GM, Ford, and Chrysler. GM also has a deep relationship with Korea. This is because the company is operating a factory in Korea after acquiring Daehoo Motors, which went bankrupt during the IMF crisis.

“Isn’t it almost impossible to use power in the domestic market because of the silver car?”

“It is not.” Rumors circulated that he would withdraw from Korea. First of all, GM denies it, but considering the power that has withdrawn and shut down the Holden plant in Australia, it is not without possibility.

GM and Ford have been in contact with underselling brands and wanting to sell less productive factories.

We first focused on Chrysler.

The Chrysler Group went bankrupt during the financial crisis, but managed to survive thanks to a bailout, and later merged with Italy’s Fiat Group to form FCA Group (Fiat Chrysler Automobiles).

At the time of the merger, it was expected that a huge synergy effect would arise from the merger of a large automobile group. But there was nothing like that.

Chrysler has a history of being abandoned after being acquired by the Daimler Group, to which Mercedes-Benz belongs, and Fiat is also being pushed to the European market by German automakers.

If it was merged with companies in bad shape, wouldn’t that be the case?

However, it does not reduce costs through platform sharing like other companies, and the operating profit margin is also low.

The FCA Group’s CEO put the company on the market for sale, but three years later, it still hasn’t found a suitable buyer.

In fact, it wasn’t too bad considering the current sales alone.

However, due to the situation of being in a deficit, they had no choice but to focus on increasing sales rather than investing in the future, and as a result, almost no investment in electric vehicles and autonomous driving was made.

For this reason, GM and Eunsung Motors, which showed some interest at first, also completely abandoned the takeover. At this point, we stepped forward and expressed our intention to take over.

We looked first at the acquisition of the US-based Chrysler. Fortunately, the FCA group responded positively.

“Ask for some Maserati as a bonus.”

“·················ogue.”

I’m having a lot of fun these days, can you give it to me?

* * *

Negotiation by phone and e-mail alone has its limits.

After a certain outline was established, Hyun-joo’s older sister came to the United States directly. Ellie also accompanied him on a business trip. The two headed straight to Detroit to meet the executives.

After finishing our work in Silicon Valley, we also decided to go to Detroit to join the two of us.

“May I ask you to reserve a ticket?”

Henry shook his head at my words.

“You don’t have to.”

“why?

“We have a private plane ready for you at the nearby airport.”

Taek-gyu was surprised at that.

“Oh oh! Private plane!”

I was surprised too.

The U.S. is almost 100 times larger than Korea and has developed airplanes instead of railroad transportation networks. Perhaps that’s why most of the richest Americans own private jets.

The same goes for Ronald. As his real estate tycoon, he campaigned across America in his luxury private jet. And it’s ironic that he has the support of the workers, not the rich.

Anyway, I didn’t know that they even prepared a dedicated plane for us.

We packed our luggage at the hotel and went straight to the airport by limousine. Henry also accompanied us.

I said sorry.

“We can go alone.”

Then Henry smiled mischievously.

“no. My grandfather told me to watch and learn while we were together.”

“Ah!”

If the only purpose was to follow us, adding someone else would have been enough. It was for this reason that Golden Gate CEO’s grandson took over our training.

Taek-gyu looked at me and spoke in Korean.

“But what can we learn?” I nodded.

“That’s the problem.”

Recently, the reputation of OTK Company has increased, and I am recognized as a great investor. Even if I think about it, it is true that I made a great investment, but I think there may be something to learn because investing is almost foresight.

Wouldn’t it be better to learn under Hyunjoo noona?

When we arrived at the airport, the private plane was already ready for departure and waiting. It was a type of Gulfstream.

The interior was decorated like a conference room. In the first place, it seems that the purpose itself is for business purposes.

Taek-gyu looked around in amazement.

“How many of these?”

“I’m going to do about 50 billion.”

“Shall we pick one too?”

“It doesn’t matter, can I write something?”

If it is a large continent such as the United States, Europe, or Australia, it is not suitable for use in Korea.

It would be convenient when going to Jeju Island or Southeast Asia.

We sat facing the table. When the shaking stopped after takeoff, Henry unbuckled his belt.

“Would you like a glass of wine?”

“Is there no beer?”

At Taek-gyu’s words, Henry was delighted.

“I like beer more than wine.”

We each had a can of beer in our hands. I’ve been thinking about having a drink with Henry for a while, but it turned out well.(Read more @ wuxiax.com)

“Cheers!”

We hit the can at Taek-gyu’s cry.

I asked Henry over a beer.

“Who is your grandfather?”

Henry said proudly.

“He is a very good person. Apart from being my grandfather, I personally respect him.”

I nodded.

“So do I. It is no exaggeration to say that Golden Gate has grown so much thanks to his role.”

Henry also talked about whether he wanted to talk to us.

It is said that Henry, who grew up watching his grandfather from an early age, naturally became interested in investing. Afterwards, he graduated from Harvard University’s Department of Philosophy and completed his MBA program to follow the path of an investor.

Taek-gyu asked.

“You were interested in investing, so why did you go to the Philosophy Department?”

“My grandfather said that investing starts with understanding people. Philosophy must be the basis for that.”

The biggest reason good policies fail is that they don’t get people’s sympathy. This is also the reason why good investments fail.

The market is not driven by cold reason and judgment, but by a mixture of people’s fear and madness.

It is not easy to see the truth in the midst of it.

You must have cool reason and animal instinct at the same time, and sometimes you have to respond to changes in the market with reason and sometimes instinct.

However, in a situation where money is at stake, people do not work properly, whether rationally or emotionally. Why would a perfectly sane person bet on a gambling board without hesitation?

“Does your father also work at Golden Gate?”

Henry shook his head at my question.

“no. My grandfather said that my father had no talent for investing. My father wasn’t very interested either. He is now a professor at the university.”

“Then what about Henry?”

Henry chuckled again. “Fortunately, he said that I am qualified as an investor.”

So, are you training your successors? Maybe Henry will later become CEO of Golden Gate.

“There is one thing I want to ask you.”

“What?”

“Do you really think Ronald will be president?”

The reason I’m asking this is because I still think Diane has an advantage, right? It’s true that Diane’s approval ratings are still higher despite the reversal in Detroit.

I smiled.

“No matter what happens this year, it will be no wonder.”

All of a sudden, empty beer cans started to pile up in front of us.

While we were chatting about this and that, I could see Detroit out of the window.