Chapter 116: Ma Huateng Lights a Cigarette for Lang Ge
After Gu Keqing swiped her card to pay at the hotel reception, she walked towards her lover Lin Lang, seeing Ma Huateng eloquently explaining the selling points of Penguin QQ instant messaging software to Lin Lang.
“A Lang, are they your friends?”
Ma Qiang was startled to see another top beauty appear beside Lin Lang, and couldn't help but think, “Mr. Lin is truly surrounded by beauties!”
“Last time at the sales office, Motorcycle Goddess Zhou Mengyao was by his side, and this time another stunning beauty has appeared. Mr. Lin truly has good fortune with women!”
Before Ma Qiang could think more,
He heard Lin Lang reply, “I'm discussing some business here, which might take some time. Keqing, please wait for me in the car.”
“Okay.”
Gu Keqing smiled slightly, then obediently left.
In the noisy hotel lobby,
Ma Huateng continued to promote the Penguin QQ instant messaging software but was interrupted by Lin Lang. Since it was an acquisition negotiation, one needed shrewdness and skill.
“Uh…”
Ma Huateng gave an awkward laugh and tentatively asked, “Mr. Lin, by not listening to me finish explaining QQ's future development prospects, are you not interested in the QQ instant messaging software product?”
Lin Lang deliberately showed disinterest and replied, “Little Ma, forgive my bluntness, but your Penguin Company's QQ instant messaging software is free to download and use online. It doesn't seem to have any good profit points!”
Ma Huateng explained, “That's right, Mr. Lin. Although the positioning of Penguin QQ instant messaging software is permanent free use, once the active registered users are sufficiently large, we can launch paid Attach services and profit from them.”
“Although our Penguin Company hasn't thought of any paid Attach services for QQ as profit points yet, QQ has only been online for just over a year, and its registered users have grown geometrically, already reaching over 30 million users.”
“I believe that by this time next year, QQ's registered users can break through 100 million, or even surpass 200 million or 300 million in the future, becoming the PC application software with the most users in China's social networking domain.”
Lin Lang listened and then said, “It's precisely because QQ's user base is growing too fast, and the enormous cost of increasing servers, that you, Little Ma, are overwhelmed, constantly adding investments until your capital chain breaks and you can't attract venture capital, which is why you're reluctantly considering selling QQ, isn't it?”
“Uh…”
Ma Huateng frowned and said, “I didn't expect Mr. Lin, despite his youth, to be such an experienced venture capitalist. After a simple understanding, he has seen through the predicament our Penguin Company is facing and discovered the crux of QQ's inability to continue its money-losing research and development and operations due to continuous additional investment.”
“It's undeniable that QQ is currently in the money-burning stage of laying out the social software market and developing to acquire users.”
“However, QQ's free download will accelerate the process of acquiring users and market share. As a new thing, instant messaging software temporarily lacks a mature profit model. Continuous losses and money burning have precisely given QQ the opportunity for rapid user growth.”
Lin Lang listened and shrugged, saying, “Little Ma, what you're talking about are all market expectations and outlooks. No venture capitalist will pay for your ideal venture.”
“Return on investment.”
“What we angel investors need to see is expected returns. Your company's QQ instant messaging software, precisely in terms of its profit model, is very vague and lacks a clear profit point.”
Ma Huateng's forehead was sweating after hearing this, mistakenly thinking that he would also hit a wall with Lin Lang.
Ma Qiang, who was standing by, couldn't speak and quickly handed over a napkin. Ma Huateng took the napkin and wiped his sweat.
“Mr. Lin, once our QQ achieves a monopolistic position in customer channels and completes its market layout in the social software domain, it should be very easy to profit and recover initial investments, whether through advertising revenue or QQ membership level fees.”
Lin Lang listened and laughed, “Little Ma, you speak lightly. To complete the massive QQ user base layout you mentioned, how much venture capital needs to be added, and how many huge sums of money need to be continuously burned? You should have an idea, right?”
“Uh…”
Ma Huateng was a bit flustered and quickly tactically pulled out a cigarette, diligently lighting it for Lin Lang with a fawning smile, saying, “Mr. Lin, please smoke. Let's sit down and talk slowly.”
Lin Lang took a puff of the cigarette and lightly patted Ma Huateng's hand, which was holding the lighter to light his cigarette, with the hand holding the cigarette. This was the etiquette for lighting a cigarette.
Ma Qiang, who was standing by, quickly pulled out a chair and respectfully said, “Mr. Lin, please sit. It's business, so you and my cousin can talk slowly, no need to rush a decision, let's chat more!”
After Lin Lang sat down, he politely said, “Little Ma, you sit too.”
“Good, good, good!”
Ma Huateng sat down, wiping sweat and awkwardly laughing, “Shanghai seems to be hotter than Shenzhen City.”
Lin Lang knew very well that Ma Huateng was anxious to attract venture capital for QQ, so anxious that he was sweating.
Therefore, Lin Lang deliberately put pressure on him, saying, “Little Ma, if business doesn't work out, friendship remains. Even if this project doesn't work out, there will still be opportunities to make money together in the future.”
Ma Huateng felt even more uncertain after hearing this and weakly said, “Mr. Lin, I still hope you can seriously consider investing in our Penguin Company. QQ instant messaging software has huge market prospects.”
Lin Lang exhaled smoke and asked, “Little Ma, how about this: I'll listen first. If I invest in and acquire your Penguin Internet Company, what is your company's estimated sale price?”
Ma Huateng gritted his teeth and replied, “Our Penguin Internet Company is valued at 92 million chinese yuan.”
Lin Lang frowned after hearing this and pressed, “Little Ma, your Penguin Company is obscure, and its QQ instant messaging software is still only in the money-losing, research and development iteration, and promotion stage. How can it be valued at nearly 100 million?”
Ma Huateng replied, “Because our QQ R&D team has poured their heart and soul into developing and promoting QQ for nearly two years, with over 30 million registered users. The initial investment in purchasing servers and other equipment was huge, plus QQ instant messaging software has enormous commercial development prospects in the future.”
Lin Lang continued to ask, “Then, Little Ma, what percentage of your company's shares do you plan to sell?”
Ma Huateng pushed up his glasses and replied, “I don't want to lose control of Penguin Internet Company, so I only plan to sell less than 40% of the shares.”
“QQ instant messaging software is like my child. Our core R&D team is reluctant to give up the right to develop QQ. We hope to develop and promote this QQ product to ultimate success.”
Lin Lang took two puffs of his cigarette and replied, “Little Ma, I can understand your feelings. QQ is like a child you raised yourself, and now you're reluctant to sell QQ and lose absolute control of your company.”
“But unfortunately, given your company's current difficult situation, trying to sell only 40% of the shares to survive, in exchange for 36.8 million chinese yuan in venture capital, it's almost impossible for any venture capital firm or internet company to invest in your QQ instant messaging software.”
Ma Huateng's heart tightened after hearing this, and he tentatively asked, “Mr. Lin seems interested in investing in our Penguin Company. What percentage of shares do you want to acquire?”
Lin Lang knew very well that if he wanted to acquire 100% of Penguin Company's shares, Ma Huateng would never sell. That would only force Ma Huateng to turn around and look for other companies to attract venture capital.
Moreover, Ma Huateng does not solely own the shares of Penguin Company; other Penguin founding team members also hold shares.
If Lin Lang does not leave a certain percentage of shares for the QQ founding R&D team, even if he acquires 100% of Penguin Company, Lin Lang, as someone who studied finance, does not understand software development at all. Re-establishing a team to continue developing QQ would undoubtedly be difficult and require immense effort.
The most important thing is that even if he were greedy enough to acquire 100% of Penguin Company, they wouldn't sell.
Lang Ge's precious time is meant for enjoying life to the fullest; where would he find the time to personally develop and promote QQ!
Besides, there will be countless high-return companies that can be invested in in the future, such as Taobao, Pinduoduo, JD.com…
If he were to acquire 100% of every company and personally manage, operate, and develop them, wouldn't that exhaust Lang Ge to death?!
Therefore, Lang Ge's bottom line is that for every company he invests in and acquires, his shareholding must reach absolute control, having absolute control over the company is enough.
So, Lin Lang falsely claimed, “Little Ma, actually, I'm not that interested in investing in your Penguin Company. I just really appreciate your personal talent.”
Ma Huateng replied with a fawning smile, “Thank you for your high regard, Mr. Lin!”
Lin Lang continued, “Lin Lang intends to be your patron, but for me to invest in your Penguin Company and help you start your business, there are two conditions.”
Ma Huateng's eyes lit up after hearing this, and he quickly asked, “Mr. Lin, please speak freely. I'm all ears.”
Lin Lang took a puff of his cigarette and replied, “The first condition is that the headquarters of Penguin Company must move from Shenzhen City to Shanghai.”
Ma Huateng replied, “This condition is easy to meet. The lease for the Shenzhen Penguin headquarters office building happens to expire next month, and it's also possible to set up the company headquarters in Shanghai.”
“Mr. Lin, please continue with the second condition.”
Lin Lang replied, “The second condition is that if you want me to invest in your Penguin Company, the percentage of shares I acquire must exceed 60%. If the company needs additional investment for development later, I can increase my investment proportionally, but my equity percentage cannot be diluted.”
“To put it bluntly, I want to have absolute control over Penguin Company.”
(As Penguin Company grows and develops, there will be rounds of financing. Lin Lang's subsequent additional investment can further increase his shareholding percentage. Like slicing a sausage, gradually holding more Penguin shares.)
Ma Huateng wiped cold sweat after hearing this and weakly said, “Mr. Lin, do you want to serve as the company's chairman and CEO, personally managing and developing and promoting QQ instant messaging software?”
Lin Lang replied, “Not so.”
“I will serve as the chairman of Penguin Company, but the CEO will still be you, Little Ma. The company's operational management rights and the research and development and promotion of the company's products will still all be decided by you, Little Ma.”
“Of course, I will grasp the general direction of the company's development and offer some reasonable suggestions, such as enriching QQ's functional development, developing QQ's industrial chain across all channels, making QQ profitable quickly, expanding QQ's derivative products, and even financing and listing, etc.”
Ma Huateng was astonished after hearing this, exclaiming, “Mr. Lin, you are truly talented!”
“To complete the QQ-related industry layout you just mentioned, it would require at least hundreds of millions of chinese yuan in additional investment, and possibly even continuous venture investment of over a billion chinese yuan.”
“Mr. Lin, are you truly willing to invest so heavily and continuously in our Penguin Company, continuously burning money without reservation, to support the layout, operation, and development of QQ instant messaging software?”
Lin Lang extinguished the cigarette butt between his fingers and self-deprecatingly said, “In China, there probably aren't any other angel investors as foolish and wealthy as me, willing to burn money and invest in your Penguin QQ, right?”
Ma Huateng pushed up his glasses and replied happily, “Mr. Lin, you're right. An angel investor as generous as you is hard to find even with a lantern.”
Ma Qiang, who was sitting by, quickly reminded him, “Cousin, Mr. Lin's venture capital acquisition of 60% of your company's shares is 55.2 million chinese yuan!”
“Your QQ founding R&D team's 40% share is also not small. With this 55.2 million chinese yuan venture capital, your Penguin Internet Company will gain vitality.”
Ma Huateng quickly pulled out his phone after hearing this and said, “Mr. Lin, I'll go outside to make a call and discuss with the company team members, then I'll reply to you whether we agree to sell 60% of our company's shares.”
Lin Lang replied indifferently, “Please do.”