Return to 1958 and build a century-old giant

Chapter 956 Investing in Dell
That afternoon, Li Aikeka urgently convened a high-level meeting and notified many senior executives of the matter.
Many senior executives were also very surprised when they heard this. They did not expect that Yang Wendong, who had once invested in Chrysler, would want to cash out and leave at the height of Chrysler's success.

More importantly, Yang Wendong is a very well-known figure in the American investment community. The news that he cashed out Chrysler stock will inevitably cause the stock price to plummet, and some investment institutions may even lower their ratings on the company's stock.

But what's done is done, and there's nothing they can do about it;
As for the company-level stock buyback, the management had no objection. For them, this was the safest measure. Otherwise, if these shares flowed into the market and ended up in the hands of an American or a large capital institution, it could really interfere with the company's daily management.

Besides, Lee Iacocca saved Chrysler and can be considered Chrysler's god now. As long as his opinions are not too outrageous, no one will disagree with them.
Thus, the management team successfully passed the resolution;
Yang Wendong was satisfied when he found out, but there was still a board meeting to attend, which would take some time to prepare. After all, the directors might be located in other parts of the world, unlike the management team who could be gathered quickly, and the company did not have much power to enforce against the directors.
Yang Wendong wasn't in a hurry; it was only a few days. He also took the opportunity to tour the Chrysler factory a few more times, with Li Aikeka accompanying him.

"Eric, this Dodge Carinnet is the world's first MPV, and it's the model that allowed Chrysler to successfully turn things around. What do you think?" Eric asked with a smile as they approached a car.

Looking at the MPV in front of him, Yang Wendong nodded in praise: "Very good, Eckka. I have to say, I really admire you. In the economic environment that Chrysler was in a few years ago, you still insisted on doing new research and development, and it was an unprecedented model. You are really amazing."

Chrysler's success was by no means solely due to the improved economic environment and the drop in oil prices;

Li Aikeka's contribution is indispensable;

In the same environment, GM and Ford had far less serious debt problems than Chrysler in previous years, but their performance last year was not as good as Chrysler's.

The most fundamental reason for this is that when Chrysler was in a hurry to sell its headquarters building, Lee Iacocca insisted on investing heavily in research and development and created the world's first MPV model.

If it weren't for the subsequent deterioration of relations with mainland China, which prevented Chrysler from entering the mainland market, the Buick GL8 in its previous life would never have been able to rise to prominence in the mainland. The market for this model would most likely still be controlled by Chrysler, the founder of the brand.

Of course, Chrysler also gradually became obsolete, for various reasons.

“Yes, those were really tough times. I often couldn’t sleep at night, which caused my blood pressure to become quite high,” Li Aicoka said with a smile. “Now it’s finally back to normal.”

Yang Wendong looked at the car in front of him and suddenly said, "Aikeka, how about we cooperate? I want to buy some of the patents for this MPV."

“This is not for sale. Business is business. Even if you are still a Chrysler shareholder, this will not be sold to outsiders,” Li Aikeka said, refusing to comment.

Yang Wendong said: "A car model cannot become a patent. Even if you create the MPV model, you cannot prevent other companies from entering this market."

General Motors, Ford, and even European and Japanese automakers will also conduct research and development in this area, and they will naturally bypass the technology and design patents you apply for.

Instead of doing that, why don't we cooperate? I'll pay a sum of money to buy some of the patents, which will save me time.

Regarding competition, I can promise not to enter the US market for ten years. My core objective is the Asian market, where Chrysler doesn't have much market share, right?

MPVs are a new type of vehicle. Although their market is not large, they have few competitors in many markets, such as mainland China.
Now that the Santana has started production, it has had a significant impact on the Mini. Fortunately, the two are positioned differently in terms of price, but official purchases are basically Santana.

It's too difficult to compete with top automotive giants in the traditional sedan or SUV market.
However, the MPV market in mainland China is also blank. In fact, Volkswagen's MPVs were not very good in the past. It was only after the 90s that Buick brought MPVs into the market.

If we could launch an MPV model in mainland China in the late 80s or early 90s, it would be very likely that we could dominate the market, just like the GL8.
Even a small fly is still meat; if a company can capture the MPV market, it can become a second-tier car company on its own.

“The Asian market? I need to think about it.” After a moment of thought, Lee Iacocca said, “Also, speaking of which, if you are no longer a shareholder of Chrysler in the future, I still hope that your car dealerships will continue to support Chrysler’s models.”

"That's easy to say." Yang Wendong didn't give a direct answer.
This kind of thing is hard to explain, and there's no way to put it in writing. It's not like it's your own car, so it's most likely that you'll have to follow the rules.
If you sell well, then I will naturally recommend you to my customers. If you don't sell well, then you can go away and stay out of the way.

Unless there is an exchange of other benefits;

By controlling nearly 2000 car dealerships worldwide, he had the capital to negotiate with top automotive giants.

“Okay, let’s discuss it later.” Li Aike also knew that this kind of thing wouldn’t be decided immediately;

A few days later, the Chrysler board of directors met and ultimately agreed to Chrysler's repurchase of the shares held by Yang Wendong.

Disagreeing is useless; Yang Wendong can still easily make moves in the capital market, which may ultimately affect the board's structure.

The news impacted the entire US financial market, with Chrysler's stock falling by 3%. Many media outlets began to speculate that Yang Wendong, the investment guru, was not optimistic about Chrysler's stock.

Yang Wendong didn't care about this; it was an inevitable result.
Who can blame them when Chrysler has already reached its peak, just like when he cashed out his Apple stock a few years ago;
After cashing out, he would have nothing to do with Chrysler's future affairs.

Subsequently, Yang Wendong and Li Aicoka signed the contract in the presence of the board of directors and with the confirmation of their respective legal representatives.

However, because the amount of money involved is so large, 30% of the money will be credited to the account first, and the remaining 35% will be credited to the account in two installments, three months and six months later.

By this point, Yang Wendong had cashed out nearly one billion US dollars and completely cleared out his Chrysler stock.

Many media outlets in Detroit and even on Wall Street in New York wanted to interview Yang Wendong, but he refused them all.
The day after signing with Chrysler, Yang Wendong quietly left Detroit and went to a city in Texas called Round Rock.

Here, there is a future top company;

Accompanying them was Rosen, who had come from New York. Rosen was a vice president of Changxing Financial Group's New York branch, responsible for the group's small and medium-sized investments in the United States.

"How's the negotiation with Cisco going?" Yang Wendong asked; 1984 was a magical year;
In mainland China, many future business giants have emerged or have transitioned from state-owned enterprises to reforms.

The same was true in the United States. Several giants were founded in 1984, including Cisco. However, Yang Wendong was unaware of such a small company in the early days and had to spend considerable time and effort to find out about it.

Rosen replied, "Mr. Yang, Cisco mainly focuses on signal processing, and their founding team is quite resistant to capital from outside the United States. At the same time, some other American capital firms are also willing to invest, which makes our chances slim."

“Yes, it involves signals, which is indeed troublesome. Even if I succeed in investing today, I won’t be able to hold a lot of shares in the future.” Yang Wendong nodded and said, “How about this, notify Sequoia Capital and let our funds indirectly hold Cisco shares through them, just say that I am optimistic about Cisco.”

Sequoia Capital was not invested in by Yang Wendong. Such investment institutions generally do not accept investment but rather assist in investment.

Rosen agreed, "Okay."

Yang Wendong then asked, "How are the negotiations with Dell going?"

Rosen replied, "The talks are almost done. Michael Dell is willing to sell 20% of the shares for $100 million, but he wants to meet with you first before making the deal."

"Okay, let's make the arrangements then," Yang Wendong nodded.

In the 80s, the United States saw the emergence of many self-made top billionaires, such as Bill Gates, Steve Jobs, and Ericsson, who were quite famous.

But there are also some who don't appear in the media spotlight much, such as Michael Dell, the founder of Dell.

After learning of Dell's appearance, Yang Wendong arranged for his people in the United States to contact him, and after several months of talks, they were basically on track.

“Okay, he's meeting me at a coffee shop tomorrow morning at nine,” Rosen said.

“Okay.” Yang Wendong nodded, then thought of something: “By the way, could you help me look up some well-known coffee chains in the United States?”

Speaking of coffee, he naturally thought of Starbucks, a company that was probably founded in the 80s.
Having traveled back in time for over 20 years, many of my past memories are not easily recalled unless triggered by a certain event.

"Yes, Mr. Yang," Rosen quickly replied.

The next day, Yang Wendong met the young Michael Dell at a local coffee shop;
"Mr. Yang, it's a great honor to meet you," Dell said, shaking hands.
"Hello," Yang Wendong said. "Mr. Dell, it's rare to see a student who starts a business like Steve Jobs did back then."

"I was also influenced by Mr. Jobs, which is why I dropped out of school to start my own business," Dell said with a smile.

Yang Wendong laughed and said, "When I have time, I'll take you to meet Steve Jobs, but you have to achieve something first, otherwise his personality isn't so easy to deal with."

Dell nodded and said, "I understand. I also look forward to meeting Mr. Jobs."

"I believe that with your abilities, this day will come sooner or later," Yang Wendong continued.

Michael Dell was already quite legendary when he was a child;
When he was 10 years old, he discovered through the newspaper that the price of some rare stamps was rising, so he hoarded stamps and by the time he was 14, he had earned $2000.

In the 70s, $2000 was a considerable sum of money in the United States, equivalent to two or three months' salary for many people.
He then used the money to buy an Apple computer, disassembled it, and learned how it worked.

In high school, he discovered a new business opportunity: collecting information on engaged couples from newspapers, inputting it into a computer, and then sending out mail to help the newspaper company find new clients. He eventually earned $1.8 in profit from the newspaper company.
After that, he dropped out of school to start his own business, founding Dell Computer Company.
Dell asked, "Mr. Yang, my company, Dell, operates on a direct sales model, contacting customers directly. It should be considered a competitor of your Best Buy. Why would you invest in my company?"

“Any business model, as long as it exists, is reasonable and will inevitably have its own market,” Yang Wendong said. “Even if it conflicts with my existing business interests, I will not refuse, but accept it.”

Many companies fail or decline because they refuse to accept new business models or new business technologies.
For example, future Kodak, Nokia, and Baidu, etc.;

Dell’s business model is to directly accept customer demand, then manufacture computers themselves and ship them to customers, bypassing the traditional distribution model.

In fact, this is very similar to the Internet model ten years later. It can only be said that Dell is a genius. He thought of the Internet business model when there was no Internet.

Of course, direct selling does exist in this era, such as the well-known Amway, but it has significant problems and has never become a traditional mainstream practice.
But Dell went on to grow into a major player, and for a time in its history, it was the world's largest computer company.

"I see," Dell nodded.
Yang Wendong said, "Mr. Dell, although your main business is direct sales, if our cooperation is successful, Best Buy would be happy to open a certain number of stores for you."

"No need. If we take both paths, the cost difference will be too great, which will inevitably lead to different prices for our customers. Since we've chosen this path, I'll try to go down it first," Dell said, shaking his head in refusal.

Yang Wendong was somewhat surprised and laughed, "Interesting. You're the first IT company to refuse to cooperate with Best Buy."

It's important to know that Best Buy is a giant that monopolizes the sales of home appliances, computers, and other products in many American cities. Even IBM relies heavily on Best Buy.

“Different business models naturally lead to different choices,” Dell continued. “However, Best Buy is not an option for cooperation. I hope to cooperate with Best Buy on after-sales service.”

“Okay, no problem,” Yang Wendong agreed.
In fact, once the internet emerges and online shopping rises, it will inevitably impact Best Buy's normal business.
However, after-sales service is irreplaceable, which is one of Best Buy's biggest strengths for the future.

(End of this chapter)