Lu An continued, “Also, if anyone doesn’t purchase the full 100,000 shares in this exercise, the remaining shares will be considered automatically forfeited. There will be no opportunity to make up for it later, unless the company launches a new round of stock option incentive plans, which is a different matter.”
Meng Qiuyan made a written memo. After a while, she looked up at Lu An and said, “What if no one is willing to exercise their options then? How will we raise funds? Have you considered this problem?”
Hearing this, Lu An said, “Of course I have, but it’s not like all 30 people will be short-sighted and lack courage, right?”
Lu An then smiled, glanced at Meng Qiuyan, and said, “If truly no one exercises their options, then you’ll bear the brunt of it, since you recruited everyone. It’s not a big problem. Even if none of them want to exercise, at worst I’ll find some good brothers to help out a bit.”
This was indeed not a major issue; Lu An had many contingency plans.
Meng Qiuyan thought for a moment and said, “Assuming a situation where no one exercises their options, we need to quickly expand our staff, marginalize these people, or even dismiss them. Otherwise, if the company’s products sell well later, and they want to exercise their options for shares, if we don’t give it to them, they might conspire to cause trouble. Without additional hires, the company won’t be able to operate normally. We need to prepare for this potential risk.”
Hearing this, Lu An said in a deep voice, “If such an extreme situation truly arises, it means they lack both vision and courage, and are extremely self-serving. Should we keep such people around for the New Year instead of clearing them out? Make a contingency plan; if this happens, immediately expand our staff and complete a major reshuffle.”
Meng Qiuyan nodded, “Understood.”
However, this should be an extremely low-probability event, unlikely to occur. Lu An also believed this situation was unlikely to happen. Nevertheless, as the helmsman of an enterprise, he needed to have a clear understanding and consider all aspects to avoid scrambling at the last minute.
The main matters were almost discussed, and Meng Qiuyan returned to her office to handle work.
The next day, around 9 AM.
Lu An arrived at the company, and the employees were all in place.
“Everyone, please put your work aside for a moment. I have something important to announce.” He said this in a loud voice in the common office area. Everyone immediately put down their work and looked at their boss.
Lu An surveyed the crowd and said in an orderly manner, “The dawn before sunrise is upon us, but the company is out of money. You are all future veterans of the company, and I will be frank. The company’s current cash balance is only seven or eight hundred thousand, which is only enough to pay everyone’s salaries for less than three months.”
“The plan to increase salaries by 50% next year relies entirely on the revenue from our first product, but now we have an urgent problem: there’s a funding gap for the materials needed for the product.”
“Last night, I thought of a solution, something Huawei once did.”
“This plan can not only solve the company’s funding shortage but also allow everyone to gain more residual value from Metaverse Intelligent Control in the future.”
The employees present listened quietly. Lu An paused for a moment, then slowly said,
“I’ve decided to value the company at 500 million yuan, with a total share capital of 100 million shares. We will take out 3 million shares as options for everyone to exercise and subscribe. The exercise price is 5 yuan per share, with a maximum of 100,000 shares per person and a minimum of 20,000 shares.”
As soon as these words came out, everyone was a little confused and immediately started whispering.
“Boss, does that mean we, the employees, are investing in the company out of our own pockets?” an employee named Li Tao immediately asked.
Lu An nodded and said, “You can understand it that way. As for whether to exercise, I’m giving everyone a week to consider. After a week, if you don’t exercise or respond, it will be considered an automatic forfeiture of this exercise qualification.”
“An exercise price of 5 yuan per share…” He Liang couldn't help but say weakly, “Boss, can it be cheaper? I don’t have that much money.”
He Liang, this employee, firmly believed that Metaverse Intelligent Control could succeed. Upon hearing that Lu An was offering stock options, he wanted to buy, even wanting to purchase the full 100,000 shares.
But buying the full amount required 500,000 yuan, and he simply couldn't come up with that much money.
He wasn’t complaining that the exercise price was too expensive, but rather that his financial resources were insufficient to purchase the full 100,000 shares.
“Just do what you can afford,” Lu An glanced at He Liang and said, then looked around at everyone and continued, “Don’t think that a company valuation of 500 million is a trap for everyone. The value of Metaverse Intelligent Control is far more than 500 million.”
“If I were talking to external VCs for funding, thinking of taking 3% of Metaverse Intelligent Control’s equity for 15 million based on a 500 million valuation, that’s completely out of the question.”
“Do you know why I’m implementing this option plan internally?”
“I said I would share the results with you, so I’m giving everyone the opportunity to exercise at a super low price.”
Lu An paused, and after a while, he said decisively, “Do you believe me when I say that Metaverse Intelligent Control will become a unicorn company in the eyes of VCs within a year?”
The employees present were all astonished.
A unicorn?
That's what companies valued over 1 billion US dollars are called.
If Metaverse Intelligent Control could become a unicorn company, and they exercised their options now at 5 yuan per share, wouldn't the value of these shares increase tenfold or more in the future?
While everyone was still in shock, Lu An continued, “You don’t have to believe it. This option plan doesn’t force anyone to exercise. If you don’t want to exercise, you can still work for me as an employee. I will pay your salary as usual, and your salary will still increase next year.”
The employees present listened silently to their boss.
Lu An said in an orderly manner, “Everything that needed to be said has been said. Whether you choose to work for me or for yourselves, weigh the pros and cons and make your own decisions. The company will give everyone a week to consider exercising or waiving the options.”
“I respect everyone’s choice. If you decide to exercise, the funds will need to be in place one month from now.”
“This decision could very well be a pivotal moment in your lives. I hope everyone considers it carefully before making a choice.”
“Alright, meeting adjourned.”
After Lu An finished speaking, the talk concluded, and he left the common office area to return to his own office.
As soon as the boss left, He Liang said to his good friend and classmate, Zhang Wenjie, “What do you think? Should we put some money into investing in the company?”
Zhang Wenjie retorted, “What about you?”
Hearing this, He Liang said without hesitation, “Me? I’m definitely going all in. I’ll figure out a way to get the money. Even if I have to take out a high-interest loan, I’m going to purchase the full 100,000 shares of options.”
Several colleagues nearby were surprised to hear this and said, “Are you that optimistic about the company?”
Zhang Wenjie said, “Brother, calm down. Don’t get carried away just because the boss says some bold words. What if the company doesn’t survive and goes bankrupt? Instead of making money, you’d lose hundreds of thousands, incurring huge debts that might take ten years to recover from.”
At this moment, He Liang pointed to the Bionic Prosthetic Limbs still in the company's office area and then said, “Seeing my relative’s reaction to this prosthetic, I believe this thing will definitely sell like hotcakes. And the boss is truly amazing; he almost single-handedly developed the technology for this prosthetic.”
“None of us contributed any technical ideas; we just followed the boss’s instructions.”
“Having the chance to work with such a giant, and not taking it? Are you crazy? Following the wrong person might lead to a few years of detours, but following the right person directly saves you a lifetime of detours.”
“This time, I’m going to make a big gamble. All in is the way to go.”
When several colleagues heard him speak so resolutely, Zhang Wenjie couldn't help but say, “You’re a ruthless person.”
…