Reborn, back to a small county town to become a wealthy family

Chapter 749 Dominance

Later that evening, Luo Yang and Song Wan met Han Dongming's childhood friend.

This guy isn't very tall, he's a little chubby, and he has a very friendly smile.

“My childhood friend, Cao Shuyu.”

Han Dongming explained, "We grew up in the same courtyard. When he went abroad to study, his family was transferred to work in Shanghai, so they moved here too. Now he's practically a local Shanghainese."

Judging from his introduction, it seems that Cao Shuyu's family has considerable influence.

"These two must be President Luo and President Song, right?"

Before Han Dongming could even speak, Cao Shuyu warmly extended his hand: "I've wanted to visit you both for a long time, but I've only recently been transferred back to China and haven't quite settled into my work yet, so I didn't want to bother you so abruptly."

Don't take polite words too seriously, but you should still respond.

Luo Yang and Song Wan exchanged a few pleasantries with him with smiles, making the atmosphere in the private room more harmonious.

It's impossible to start talking business right away after meeting.

"When I reviewed the company's research reports before, I only saw that President Luo was young and promising in the documents."

After everyone sat down, Cao Shuyu took the lead and began to speak: "Now that I've met you in person, I even have a feeling that I'm getting old. You're just like the entrepreneurial groups I've seen in Silicon Valley, all of you are incredibly young."

"Young people are quicker to accept new things and are more sensitive to technological changes."

Luo Yang replied with a smile: "Zuckerberg and his Harvard roommates founded Facebook on campus, and it went public in May this year with a market value of 100 billion US dollars. There are many young people like this in Silicon Valley. What is my achievement compared to that?"

This wasn't him being modest.

When Facebook went public, founder Mark Zuckerberg held a 34% stake, and based on the stock price and market value, his personal net worth reached 340 billion US dollars.

Even if the local currency and the US dollar were exchanged at a 1:1 ratio, his current net worth still wouldn't be comparable to this guy's.

"Mr. Luo is too modest. Some differences are due to special reasons and do not prove that those people are much better than you."

The opportunity to get to the point suddenly arose.

Cao Shuyu seized the opportunity and said, "The United States is the center of global capital. A company of the same type might only have a market value of 1000 billion yuan in China, but if it appears on the US market, its market value might increase by ten or even dozens of times."

He wasn't exaggerating.

Over the next ten years, the combined market capitalization of these seven tech companies—Apple, Microsoft, Google, Amazon, Meta, Nvidia, and Tesla—will be staggering.

At its peak, Nvidia's market capitalization exceeded 4 trillion US dollars, surpassing the GDP of Japan and India, and roughly equivalent to one-third of China's A-shares.

It has been joked that the combined market capitalization of seven or eight large state-owned enterprises that control the lifelines of China's energy and transportation sectors is only equal to that of Nvidia alone.

But if it really came down to changing it, even a fool wouldn't agree.

This time it was Han Dongming's turn to cooperate.

As soon as Cao Shuyu finished speaking, he chimed in, "Yes, for example, projects like bike-sharing companies. This second round of financing has valued them at around 200 to 300 million local currency. If they were to raise funds in the US, the valuation would be at least 200 to 300 million US dollars."

The two sides use different currencies for pricing.

Even with the same assessment, the difference is more than six times.

"As of the first half of this year, the number of Chinese companies listed in the US has reached 154."

Cao Shuyu continued, "Especially many innovative technology companies are flocking to ring the bell. Even a behemoth like Alibaba is seeking to list in the US. We should see results within a year or two."

The two described the prosperity of the US market in a call-and-response style.

Does Luo Yang know all this?
Having experienced the era of advanced self-media, he does indeed know a thing or two.

It must be acknowledged that the United States has a long history, a large scale, a sound regulatory system, and strong market liquidity. These characteristics provide domestic companies with a favorable financing environment and broad development space.

The US capital market provides greater support to innovative and technology companies, offering more opportunities and space for domestic innovative and technology companies seeking overseas expansion.

If the goal is to list on the US stock market, it's for a higher valuation and better financing results.

The US capital market values ​​companies more market-orientedly, focusing more on company performance and future growth potential.

At the same time, US investors are more rational and long-term in their investments in companies, which enables companies to obtain more financial support and development opportunities during the financing process.

Another point that must be mentioned is avoiding policy risks and market risks.

As is well known, China's capital market regulatory policies are relatively strict, and the listing requirements and regulatory standards for companies are also relatively high.

The US capital market has relatively relaxed regulations, and the listing requirements and regulatory standards for companies are relatively low, which provides more listing opportunities and market space for domestic companies.

It's important to note that the US uses a registration system; as long as the conditions of a stock exchange are met, an application can be submitted for listing. In contrast, China uses an approval system, which makes listing much slower. Take Jiang Yuanshan's Yuanfan Electric Vehicles as an example: it's been over a year since they started seeking a listing, and they still can't be certain of success.

According to Lao Jiang, it might take another year or more.

It's worth noting that when Yuanfan Electric Vehicles was launched, Jiang Yuanshan hired the best auxiliary institutions in China.

This is one of the reasons why many domestic companies later flocked to list on US stock exchanges.

Another aspect is to enhance brand awareness and international influence.

The United States has one of the most important capital markets in the world, with a large investor base and a globalized market environment.

After a domestic company lists on the US stock market, it can enhance its brand awareness and international influence through interaction and cooperation with international capital.

Finally, there is one particularly special point: the advantages of the dual-class share structure.

Some innovative technology companies receive institutional investment in their early stages. By the time they go public, many founders may only have a few percent or even twenty percent of the equity left, which, according to conventional thinking, is insufficient to control the company's operation and management.

Fortunately, the US securities market allows companies with dual-class share structures (A and B shares) to list or list depositary receipts, which helps founders better control the company's future development. This is especially important for innovative technology companies.

Han Dongming and Cao Shuyu didn't finish their relay until the hot dishes were served.

"Let me bring you a glass of wine."

We can't let them get ahead of themselves. Luo Yang picked up his glass and said with a smile, "First of all, I want to thank President Han for visiting Shanghai. I'd like to take this opportunity to express my hospitality as the host."

Han Dongming repeatedly expressed his politeness and raised his glass in response.

Since she was going to disrupt their rhythm, Song Wan cooperated by offering a second toast, ostensibly to thank Han Dongming for helping bicycles get into universities in the capital.

When Luo Yang picked up his third glass of wine, he brought Cao Shuyu inside.

After a few rounds of drinks and some hot dishes, the conversation returned to the main topic. "Mr. Cao, we talked about this this afternoon when I was having coffee with Mr. Han. He said that you suggested we replicate the bike-sharing project in the US and European markets, and he mentioned the intention to cooperate."

This time, Luo Yang took the initiative: "The key is what kind of relationship President Cao has with IDG headquarters, and to what extent can he influence their decision-making level?"

This is the most practical problem.

No matter how well you describe it now, or how eloquently you speak, the US company headquarters will not be interested in the cooperation at all, and all your previous enthusiasm will be wasted.

"Since President Luo has already discussed this topic with Dongming, I'll get straight to the point."

Cao Shuyu is also a straightforward person: "Although I am currently only a senior manager in IDG Greater China, not a high-level executive, let alone a position at headquarters, I served as an assistant to Executive Vice President Kelvin Martin for two years before returning to China. My assignment to IDG Greater China this time was thanks to Kelvin's help."

Don't assume that foreigners don't follow factions.

According to Cao Shuyu, he belongs to the same faction as Executive Vice President Kelvin.

In addition to serving as executive vice president, Kelvin Martin is also a major shareholder of IDG, making him a highly influential executive who can significantly impact the company's decision-making.

"Not only that."

Cao Shuyu continued, "Just last week, I reorganized the research report on the shared bicycle project and sent a copy to Vice President Kelvin via email. I also communicated some ideas with him and received his partial approval."

There was talk about this around this time last week.

Song Wan also went to the capital last week and reported back to me the cooperation intentions expressed by Han Dongming.

Cao Shuyu also communicated with IDG headquarters last week.

Which one comes first?
If Cao Shuyu had Han Dongming contact Song Wan before communicating with headquarters, then the cooperation would still only be his personal idea.

If Han Dongming's proposed cooperation came after discussions with headquarters, then it had a probing element to it.

Luo Yang leans towards the former.

The reason for the judgment was Han Dongming's phone call.

Cao Shuyu received feedback from headquarters, which led Han Dongming to contact Luo Yang and ask him to come to Shanghai in person to discuss cooperation.

"According to Mr. Cao, how should we cooperate?"

Since Cao Shuyu indicated that he also had the support of senior management at headquarters, Luo Yang opened up: "How about registering a company directly in the United States, making appropriate adjustments based on the actual situation of the local market, and finally transferring the model there?"

"Mr. Luo, the company's operations are your responsibility."

Upon hearing Luo Yang's explanation of the specifics, Cao Shuyu immediately replied, "The cooperation I'm referring to is between President Luo and IDG. There isn't a single powerful local American company protecting them. It just means that it will be quite difficult for you to operate there."

This statement is tantamount to telling Luo Yang that without IDG's cooperation, the biggest problem for a company that is 100% controlled by a domestic company to operate in the United States is not the difficulty itself, but whether it can operate smoothly at all.

"That's no problem. I originally planned to bring in overseas capital when the company was first established."

Luo Yang smiled and said, "And it's not just IDG."

Even without mentioning a name, Cao Shuyu blurted out, "Is the other one Sequoia Capital?"

"Yes, Sequoia Capital!"

Luo Yang nodded frankly and said, "I met with Shen Nanpeng yesterday afternoon and we reached a preliminary agreement."

Cao Shuyu fell silent immediately.

"Mr. Cao, IDG wouldn't want to monopolize the market, would it?"

Just as the room fell silent, Luo Yang spoke up: "In the United States, there are so many innovative technology companies, and everyone shares the pie. There's no one trying to take all the profits. What I'm doing is simply following the rules of the American market. Is that so wrong?"

"Mr. Luo, IDG does not intend to dominate the market, nor does it have such a thought."

Cao Shuyu could no longer remain silent and quickly explained, "What I meant was that in the initial stage, the company will only receive investment from IDG and your company. When the subsequent financing stage begins, other investment institutions can be introduced."

"With two internationally renowned investment institutions showing optimism about bike-sharing in the initial stages, wouldn't this give the project a greater advantage for its future development?"

Luo Yang looked at Cao Shuyu with a smile: "Don't you want the domestic portion of the shares?"

"what?"

"what?"

Cao Shuyu and Han Dongming both expressed their surprise and doubt at almost the same time.

"If it were just about cooperation in overseas markets, I would have reached an agreement with Sequoia Capital yesterday. We wouldn't be having this conversation here now."

Luo Yang smiled and said, "If Sequoia Capital wants to get initial shares in the company registered in the United States, it has to give up a portion of its second round of financing subscription equity to another overseas investment institution. That's what I discussed with Shen Nanpeng in private."

Cao Shuyu's breathing suddenly became heavy.

While I am optimistic about the sharing economy concept in the European and American markets, we haven't tried it yet, and there is a possibility of failure.

However, the situation is different in China. Judging from the current market conditions, the company is developing very healthily. The next step is to move out of the campus and into the city. As long as this step goes smoothly, success is a sure thing.

Securing a second round of funding is undoubtedly a pleasant surprise.

Getting on this wealth express train is a good thing for both IDG Greater China and Cao Shuyu's personal performance.

"So this is your way of showing sincerity to IDG?"

"It is indeed a gesture of goodwill, but it may not necessarily be for IDG."

Luo Yang smiled and corrected Cao Shuyu, saying, "We're showing our sincerity through domestic projects, selecting partners who are genuinely interested in cooperation. It could be IDG, Hillhouse Capital, or Sequoia Capital's US branch."

Cao Shuyu fell silent after hearing Luo Yang's words.

Yes, he has the initiative. He can choose the best partner, so why does it have to be IDG?
"It's just a competition of who offers better terms for cooperation!"

Sensing the tense atmosphere, Han Dongming spoke up: "In any case, at least Lao Cao, representing IDG, was the first to propose a cooperation to jointly explore overseas markets. Regardless, let's talk about it first, and then let President Luo compare the options himself under the same conditions. He will definitely give priority to his friends."

That's the difference between the two.

Cao Shuyu went abroad to study after high school and stayed abroad to work after graduating from university. His business thinking is more Westernized.

Han Dongming has lived in China since childhood, and whether it's dealing with people or doing business, he always uses the Chinese way of doing things.

It's all about a relationship.

But Luo Yang actually fell for his act.
(End of this chapter)