What's wrong with me being a rich man?

Chapter 438 Seeking Truth
The seminar between the Silicon Carbon Group's Materials Laboratory and Carbon Power Company was very well conducted, with both sides expressing optimism about the prospects for the implementation of integrated die casting.

According to Du Yaojie, the introduction of the equipment will be completed before Q2 of 2014.

This was done earlier than when the R&D budget was requested, which naturally reflects the strong support from President Yu's keen insight.

Xiong Xiaoge could tell that General Manager Du was exaggerating, but he was also delighted that the Silicon Carbon Group had completed an important technological innovation.

However, when the meeting ended, he noticed that President Yu's expression was still quite serious, and he felt strange: "President Yu, wasn't today's meeting supposed to be good news? Why don't you seem happy?"

"No, no, I'm quite happy." Yu Xing pulled himself out of his thoughts and said to Xiong Xiaoge with a smile, "I just hope that every time we hear good news like this, you shareholders can catch up with it, then there won't be any problem with the next round of financing."

Xiong Xiaoge, unaware of what President Yu was thinking, followed up by saying, "IDG's financing in this round should be fine, but Today Capital and others may not be able to continue. If there are any issues, then we'll take the lead in finding another group of institutions. As things stand, the assets are all in Lingang."

Today Capital may not lack confidence, but as the scale of financing for Silicon Carbon Group grows larger and larger, the internet, especially the mobile internet, seems more cost-effective compared to continuing to invest in such asset-heavy projects.

IDG has already made some preparations in this regard and is naturally aware of the considerations of its peers.

Yu Xing thanked President Xiong for his efforts, but also gave a clear statement: "President Xiong, the next round of financing for the Silicon Carbon Group is not in a hurry. It may be the last round of financing before our models are launched on the market. The company will consider this matter carefully."

Xiong Xiaoge pondered President Yu's words, offering his blessings to the Silicon Carbon Group as it ventured into the market.

He then accompanied General Manager Yu on a tour of the factory, concluding IDG's pre-Lunar New Year inspection of the Lingang project. However, he also resolved to discuss investment opportunities here with his friends at Facebook in the United States.

After seeing General Manager Xiong off, Yu Xing turned around and went back to his office to conduct a rudimentary study of Kobe Steel in Japan.

Mitsubishi's fraud has been exposed, Renault's fraud, which is allied with Nissan, has been verified, and Takata, a company that makes airbags in Japan, has frequently been the subject of negative public opinion in recent years.

Yu Xing was probably aware of Japan's transformation from artisans to craftsmen, and firmly believed that there were still many problems in Japanese companies. He had been closely monitoring the situation of Japanese suppliers in the silicon carbon group's supply chain, but had not received any feedback.

However, this is normal.

Just like with Kobe Steel this time, if Yu Xing hadn't pressed for details after seeing the documents, the matter would have been simply let go.

The supply chain has different levels. LK Group directly supplies products to Silicon Carbon Group, while Kobe Steel is a supplier of LK Group. This creates a layer between them, which naturally makes it more discreet.

Moreover, Kobe Steel is a century-old company that has long supplied top global companies such as Toyota and Boeing, and has accumulated enough reputation to make downstream companies lower their guard, or even... actively filter out negative information.

After the meeting, Yu Xing casually asked Du Yaojie how to handle the situation now that Kobe Steel had encountered problems.

Du Yaojie responded, "We have had a cooperative relationship for many years. This time it may be a batch problem, or... well, it shouldn't have a big impact on our cooperation. I have already informed the company about the situation, and I believe Kobe Steel will give us a reasonable answer."

He assumed Mr. Yu was worried about the die-casting machine, so he added, "The materials for the die-casting machine are tested repeatedly. I think maybe our strength estimates were a bit insufficient. The Kobe Steel machine is stuck on the production line."

The ultra-large die-casting machine itself represents an improvement over past processes, which in turn requires improvements in material properties.

Because of his trust in Kobe Steel, Du Yaojie subconsciously considered the possible oversights in this area within his own company.

Yu Xing is different.

He doesn't rely on preconceived trust, and he's also wary of this unusual behavior.

Take Takata Corporation as an example again. Its airbags are also supplied to many top-tier car brands around the world, including Volkswagen, Mercedes-Benz, and BMW. Before the incident, its business scale and industry reputation were excellent.

Logically, a top-tier global reputation would inevitably incur heavy penalties and enormous costs if something went wrong, making everyone feel that it's completely unnecessary and not worth it at all. However, on the other hand, perhaps they are using this mentality to reduce costs on one hand and increase profits on the other.

Yu Xing briefly summarized the information about Kobe Steel, pointed out the problems encountered by LK Group, and listed the situation of suppliers similar to Takata airbags. He then handed it to Guo Shanfeng that evening.

Liu Wanying quickly scanned the documents, her first reaction being absurdity—not at Kobe Steel, but at the problems encountered in this particular cycle.

She demanded, "What's going on in your car industry? Engine fraud, emissions fraud, oh, airbag fraud, and now aluminum alloy fraud... What's going on with you all?"

Yu Xing shrugged, speechless.

Liu Wanying looked at it twice more and shook her head, saying, "Verification won't be too difficult. Let's purchase a few batches of raw materials, focusing on the 6000 series aluminum that Lijin used. We'll know if there's a problem once we test it."

She thought for a moment and then asked, "This kind of testing equipment shouldn't be too expensive, right?"

"I asked briefly what kind of tensile testing machine I needed. The whole set would probably cost a few million at most, but I don't need to bother with that. There are many testing institutions both domestically and internationally. Just pay attention to the channels for submitting the samples. You can still do mixed testing. You can mix materials from different suppliers and send them to different testing institutions." Yu Xing had even considered the process on his way home.

Liu Wanying nodded, and the question returned to the topic of the industry: "Just how many shady dealings are still going on in your car industry?"

“There are too many suppliers, and sometimes it’s hard to resolve problems. If my die-casting machine breaks down, I’ll only contact Lijin. Lijin has to investigate, and that can take a long time,” Yu Xing explained. “They can also shift the blame to the processing department, and then it might just be dropped.”

He then recalled the air suspension issue and said, "Last time, our air suspension in Germany also had a problem with a second-tier supplier. Just one plastic ring caused the impact test to fail. I asked the engineers from Germany, but they wouldn't tell me which supplier it was."

This could be to protect suppliers, or it could be a habitual way of handling things internally. In any case, they will deal with it, and small customers don't need to ask how they will handle it.

This die-casting machine is different. The two sides established a joint venture and had senior executives face to face, which brought Kobe Steel, which was suspected of having problems, to the surface.

Liu Wanying scoffed, "This transfer of trust, Kobe Steel might even be a green channel for many companies."

Yu Xing felt that this was indeed possible.

“If Kobe Steel really has problems, and if Guoshanfeng makes a successful sale next year, I think 2014 could be named the year of ‘chaos in the automotive industry,’” Liu Wanying said leisurely. “The value of Silicon Carbon Group’s ‘honest car manufacturing’ is really rising.”

She thought for a moment, then laughed and said, "Silicate Carbon Group is honestly manufacturing cars, so how come they can find out that other companies are not being honest?"

“The Silicon Carbon Group is pragmatic,” Yu Xing said. “Overcoming obstacles is about seeking truth, and that’s how we caught up.”

Liu Wanying blinked: "I'll hang the words 'Seeking Truth' in the office of Red Falcon Capital later."

She said with a smile, "To be honest, sometimes sneaking around on the mountain peaks really feels like wearing fine clothes in the dark." Yu Xing shook his head: "That saves too much trouble."

Liu Wanying nodded, put away the complaint documents, and planned to resolve the material testing issue with Kobe Steel before the end of the year.

To date, among all the scams she has handled, large and small, almost none can withstand the scrutiny of the phrase "seeking truth and being pragmatic." The truth or falsehood, the quality or inferiority, can be easily determined with a test and an investigation.

The most perplexing issues are the emissions problems of Volkswagen and Renault. Based on the current situation, it is estimated that these two companies have similar methods of falsification, which is to integrate the means of detecting parameters such as steering wheel angle, vehicle speed, and air pressure into the engine.

Yu Xing even thought there might be a signal location feature to determine which emission standard market area it was in.

If we follow conventional testing methods, it is indeed quite difficult to detect the fraud by the two car companies. However, if we find the right approach, it can be just as easy to detect.

From the earliest Finntron to the current Kobe Steel...

For a time, Liu Wanying worried that the mountain peaks didn't have suitable targets, but now she increasingly feels that if the mountain peaks continue to operate like this, they may truly be able to prosper for a long time.

……

After intermittent operation over the mountain peak, it fell silent.

Yu Xing was only able to inform Lu Haiying about the Facebook board of directors that Xiong Zong had mentioned after Xiao Ying took over the work.

Directors, capital.

Lu Haiying's eyes lit up when she extracted the keywords.

"Senior, this kind of board member must have a good influence on Facebook."

“Mus is going to need funding anyway, so we can bring in their money and then see how things go. If things go well and the timing is right, Carbon Silicon Data can just take full control of Mus.”

“If carbon silicon data is used for financing, I don’t think it’s worthwhile.”

There is considerable room for maneuver here.

Yu Xing asked, "Do you think it's okay to let Jim know that we're the ones making Mus?"

It's very difficult for a startup to get funding normally, and it's even more difficult to target Jim's company.

If you want to connect with Jim, you'll probably still need to gain his trust. Moreover, the latest trending topic's overseas expansion model may not have deceived Xiong Xiaoge; it is indeed one of the company's considerations.

“Mus is a vertically segmented app that combines music and short videos,” Lu Haiying said thoughtfully. “Facebook is the social media ceiling overseas, and vertical segmentation is our differentiated competition, as well as a good camouflage.”

A suitable vertical segmentation is about finding a space to play in, but it's not easy to expand upwards further.

Lu Haiying continued, "Simply making Mus successful, I don't think we'll face targeted competition from Facebook. We might even attract their interest in acquiring us, unless we transform Mus into a short video app across all categories and do it well. Then they might consider full-scale competition."

Mus is currently focused on creating lip-sync music, following a similar approach to Silicon Carbide Data, where they first accumulate traffic and then use this content to refine their algorithm technology.

According to Yu Xing and Lü Haiying's plan, once the traffic and technology mature, it can be seamlessly transformed into a full-category short video project.

However, that was the time when Mus returned to the carbon silicon data.

Yu Xing grunted, "I'll think about it some more. We can also wait until Mus produces results in the first quarter before pushing this forward."

Lu Haiying nodded: "There is contact with front-line sales staff, as well as influence from board members. Mus will need to divide the data into different countries, and the part that requires connecting with Facebook, I think, should be slightly concealed."

Looking at Xiaoying's serious expression, Yu Xing laughed and said, "We've actually imagined such a huge giant here. If Mus doesn't do well in the first quarter, we'll have to find another way to make a fool of ourselves."

"Senior brother!" Lu Haiying said earnestly, "We placed the logo in the part that couldn't be cut off, and the conversion rate is already quite good. Differentiation and vertical segmentation can definitely pave a way out!"

This is the initial confidence brought about by Mus's cold start performance since its launch.

Yu Xing smiled and suddenly remembered Xing Hongyu, who had already joined the Silicon Carbon Group: "That Xing Hongyu from Tencent, observe him again before and after the New Year, and then you can send him to work for you in Singapore."

Lu Haiying hummed in agreement, her mind still preoccupied with the potential opportunities that a Facebook board seat might present.

However, when she went to the cafeteria for lunch, she actually saw Xing Hongyu. He seemed to be discussing work with his colleagues while eating.

Lu Haiying walked around halfway, passing by Xing Hongyu, and asked in surprise, "Mr. Xing, you've come to Silicon Carbon? How are you settling in?"

Xing Hongyu was caught off guard when he saw Lü Haiying. He thought that she was probably still researching short videos and the Internet in the carbon silicon data room next door, while he could only follow along to study the vehicle system. He couldn't help but feel a little embarrassed.

"Uh, yeah, yes, I'm getting used to it. The food in the cafeteria is pretty good. Uh, everything's fine."

Lu Haiying smiled at him and said, "The conditions here might be a bit tough, Mr. Xing, good luck!"

She picked up her tray and turned to leave.

Xing Hongyu silently watched the man's retreating figure, sighed without a sound, and began to doubt whether his choice was right or wrong. Two years is not a short time.

Two years is indeed a long time; it's enough for a company to thrive in the mobile internet field.

As an investor in this company, Xiong Xiaoge introduced the carbon silicon data company to his friend Jim in this way. It was less than three years since Mr. Yu came to Hong Kong to work on carbon silicon, just two weeks before 2014.

During this period, Carbon Silicon Data Company has broken through the business model that Huaxia Internet could not rely on for revenue based on advertising, and will continue to promote the development of this model in the future.

Xiong Xiaoge's concise and to-the-point remarks quickly piqued Jim's interest.

(End of this chapter)