A century-old wealthy family that rose from Shanghai

Manhattan, New York.

Chen Wenhua sat in an office with a window overlooking Wall Street, a prime location.

At that moment, he was writing 'A Letter to Shareholders: A Season of Harvest'.

“In the past 1970s, Union Madison’s market value rose from a low of $12 million in June to $50 million by the end of the year, an increase of 300%.”

"I think the profits mainly came from two sources: First, in early May, United Madison began buying 'Nifty Fifty' stocks, during which time the average Dow Jones index was below 700, with an investment of $50 million over the period of May to June; starting in July, the Dow Jones index began to rebound, and by the end of the year, the Dow Jones had risen to 840, and we made a paper profit of $15 million."

"Secondly, we have partnered with United Madison's Tyson to acquire a 20-year patent for Post-it Notes. Post-it Notes are very popular in the United States, and some predicted that they would bring substantial profits to United Madison. This has indeed been the case. Our next step will be the global development of Post-it Notes and the protection of our legitimate patent rights."

29-year-old Chen Wenhua possesses both composure and youthful passion, and at this moment, he is filled with excitement.

Although he only owns 46% of United Madison, a company with a total market value of just over $5000 million, which is only a portion of his personal wealth, it is a business and the foundation upon which he stands on Wall Street.

"Employ one business and run the other finance," that's what his father told him.

In 1967, Chen Wenhua acquired United Madison, which was then a small publicly traded company with a market capitalization of $500 million. He then quickly expanded his business by acquiring life insurance companies and Taiyang, and invested heavily in the stock market.

By early 1969, United Madison's market value had exceeded $1600 million; more importantly, he had successfully cashed out his shares in the early part of the year.

His strategy of buying low and selling high allowed him to begin to make a name for himself on Wall Street, becoming the second-generation Chinese-American "stock god" after Cai Zhiyong.

Of course, with the success of the "sticky note," Wall Street discovered that Chen Wenhua was not only a stock market guru, but also a master investor. Unlike those who only knew about financial investments, the success of the sticky note gave him a solid foundation.

Meanwhile, at 3M's headquarters in St. Paul, Minnesota, CEO Bill McKnight was frowning as he looked at a market report.

The report shows that Taiyang's Post-it notes captured 10% of the US office supplies market within just one year of their launch, and the growth rate is still accelerating. The core technology of this "blockbuster product" is remarkably similar to a research achievement by 3M six years ago.

“Call a management meeting and have Dr. Spencer come too.” Bill put down the report, his tone filled with undisguised regret.

In 1967, Dr. Spencer Silver, a 3M R&D engineer, accidentally discovered a type of adhesive that was "not very sticky but could be repeatedly pasted" while researching high-strength adhesives. However, at the time, 3M was focused on industrial high-strength adhesives, and no one realized the value of this seemingly useless adhesive, nor did they even apply for a patent. Today, Tyson Technology has not only developed Post-it notes using the same adhesive but has also monopolized the market through patent strategy, leaving Bill Gates feeling both guilty and regretful.

The atmosphere in the conference room was extremely heavy. Bill was the first to stand up and bow deeply to everyone: "I want to apologize to everyone. Six years ago, Dr. Spencer developed a reusable adhesive, but we failed to pay attention to it and did not apply for a patent. Now, Taiyang Company has seized the opportunity and we have missed out on a product with unlimited potential."

As soon as he finished speaking, someone quickly comforted him: "Bill, this is not your fault. Who would have thought that this kind of 'weak' glue could be made into office supplies? Taiyang succeeded because their Chinese CEO conducted targeted research and development; we just lacked such an opportunity."

Dr. Spencer nodded in agreement: "That's right, I didn't think of any applications for this glue at the time either, and it's no one's fault."

Listening to everyone's comforting words, Bill gradually calmed down, but his eyes remained firm: "Tayyang is just a small company. It doesn't have a global sales network or production capacity, and its brand recognition is far inferior to ours. I will personally go to New York to discuss licensing cooperation for the sticky notes with them—even if we can't regain control, we must make up for this mistake through cooperation and not let our competitors seize the initiative."

This decision immediately received unanimous support from management. In their view, 3M's global network of factories and distributors was an advantage that Taiyang could not match; as long as they could obtain authorization, they could leverage 3M's distribution capabilities to make Post-it notes a global product and even surpass Taiyang's market share.

When Bill and his team headed to New York, Chen Wenhua had just finished finalizing his letter to shareholders. Upon learning that 3M was interested in collaborating, a smile crept onto his face—this was exactly the situation he had hoped for. "Tell Mr. Bill I'm waiting for him in my office at 40 Wall Street," Chen Wenhua told his assistant, his fingertips lightly tapping a sticky note on the table.

“3M’s distribution channels can help us promote Post-it notes globally; and our patents can help 3M make up for its shortcomings. It’s a win-win negotiation.”

Chen Wenhua is no longer the "Chinese newcomer" who just entered Wall Street a few years ago. The soaring market value of United Madison has given him enough influence in the financial world; Taiyang's sticky note patent has added to his bargaining power in industrial negotiations.

He knew that the partnership with 3M would not only allow Post-it notes to quickly capture the global market, but also leverage 3M's industry position to enhance United Madison's brand recognition in the industrial sector.

Meanwhile, Bill sat on a flight to New York, repeatedly reviewing the documents of Taiyan Company.

He knew that the core of this negotiation was "licensing fees" and "market share"—3M needed global production and sales rights, while Taiyang hoped to retain patent dominance and obtain a reasonable share of the profits. But he didn't expect that this young Chinese-American CEO would propose a cooperation plan at the negotiating table that far exceeded his expectations.

In early 1971 in New York, a business negotiation surrounding Post-it Notes was about to begin. On one side was Chen Wenhua, a rising star with patents in hand, and on the other was 3M, a company with a deep foundation and eager to make up for its shortcomings.

The outcome of this negotiation will not only determine the global fate of Post-it notes, but will also be a significant chapter in Chen Wenhua's "finance + industry" strategy.

It’s Spring Again (1971).

After reaching a cooperation agreement with 3M, Chen Wenhua visited Taiyang Company and convened a meeting with management and engineers.

"I hope we can emulate excellent companies like 3M, encouraging employees to think and invent. In terms of organizational structure, Taiyang adopts a decentralized operating model that continuously branches out into new divisions, organizing new business development teams or project teams. Personnel come from various professions and are all volunteers, provided with operational guarantees and compensation for innovation. Anyone with a new business can seek funding from any division within the company. Developing a new product not only brings salary but also promotions. For example, someone who starts innovation as a basic engineer becomes a product engineer when their product enters the market. But when product sales reach $100 million, their title and salary change. When sales reach $2000 million, they become a product series engineering manager; and when they reach $5000 million, an independent product department is established."

These words were met with thunderous applause, with many engineers clapping along.

Of course, everyone understands that the success of the sticky notes is not primarily their responsibility, but rather the inspiration that came from the Chinese-American owner.

On the other hand, everyone's salaries have indeed increased.

CEO Warren then said, "With the success of our Post-it notes, we have at least hundreds of millions of dollars in profits in the future, which is key to supporting Taiyang's transformation into a comprehensive innovative company. And the person who brought this inspiration is Mr. Blues, and we applaud him!"

Those present applauded again; they admired the strong.

Next, Chen Wenhua said with a smile, "There are many inspirations in life, but the key lies in the hard work of engineers. The success of this sticky note is largely thanks to Dr. Kyle's team, so Dr. Kyle will lead the establishment of a 'sticky note' product department. We can enter the lipstick glue industry, which is also an excellent product like the sticky note."

It's also Chen Guangliang's fault for not remembering, otherwise this lipstick glue (solid glue) would have been Taiyang's.

Dr. Kyle said happily, "Okay, thank you for your trust, Mr. Blues."

After the meeting, Chen Wenhua privately approached Warren, the president of Taiyang. He said, "When I went to the hospital last time I was sick, I noticed something. The nurse put an IV in my hand, and she wrapped it in gauze. This made it impossible for me to see what was inside, whether there was backflow of blood or infection. Therefore, Taiyang needs to establish a medical department to combine adhesive and film technologies to invent transparent dressings. This would solve a major medical problem."

Warren's eyes lit up, and he said, "Mr. Blues shouldn't be a stock market guru on Wall Street, but an inventor. That's a great idea."

Chen Wenhua waved his hand modestly and said, "What kind of inventor am I? You should know that such technology seems simple, but it is actually very difficult. We don't have enough technology like 3M. Just this bonding and film technology, those are 3M's advantages."

Warren immediately said, "We can get licenses, just like they pay us patent fees, we can also pay them patent fees, and invent faster."

"Okay, you can take care of this!"

The two exchanged many details and became friends, rather than in a superior-subordinate relationship.

Taiyang may not become as outstanding as 3M, but it will have its own development and will certainly become a great company in the future.

Chen Wenhua's investment in Taiyang is partly aimed at transforming his company, United Madison, into a large investment holding company.

In spring, Discovery Bay on the north shore of Lantau Island in Hong Kong is surrounded by green hills and sparkling blue sea.

The golf club and yacht marina developed by Hong Kong Resorts International, a subsidiary of CK Asset Holdings, officially opened. Invited Hong Kong tycoons and celebrities gathered on yachts to witness the debut of this "city within a city on an offshore island" amidst the sea breeze and greenery.

At 10 a.m., a champagne tower and floral arrangements complemented each other in the plaza in front of the golf club, while staff members in smart uniforms greeted guests.

The clubhouse features off-white stone and floor-to-ceiling windows, combining European elegance with modern openness. It also boasts an 18-hole international standard golf course—the fairways wind along the mountainside, with sea views on one side and greenery on the other, offering scenic views at every turn.

"Mr. Chan has a truly discerning eye!" Lee Shau-kee of Henderson Land Development exclaimed. Only the Chan family has the vision to build a top-tier luxury residential area away from the city center.

Cheng Yu-tung of New World Development said, "It is said that the initial investment is as high as 300 million, and this is an investment that will not be realized until the money is seen, which is infrastructure construction."

Several emerging real estate developers couldn't help but marvel, and secretly rejoiced—if these funds were used to develop Hong Kong residential properties, where would they get a share of the pie?

Stepping into the clubhouse, the banquet hall on the first floor can accommodate 200 people for dining, with crystal chandeliers and silver tableware exuding luxury.

The Discovery Bay Golf Club has extremely high membership requirements, which can only be described as stringent. Even so, many wealthy individuals expressed their desire to join on the spot: "Not only is the environment top-notch, but it is also a top-notch social venue for networking."

Not far away at the marina, hundreds of Hong Kong-branded yachts are docked. Hong Kong Resorts International arranges sightseeing boats to take guests on coastal tours, where white dolphins occasionally leap out of the water, eliciting gasps of amazement. "From now on, coming here for a weekend boat trip is much quieter than Victoria Harbour," said a shipping tycoon.

Halfway through the celebration, guests took a ride in a vintage sightseeing vehicle to tour the attractions.

As the car drove to the west side of the clubhouse, dozens of low-density villas were under construction, with gray roofs, light-colored exterior walls, and each villa had its own courtyard. The houses were spaced far apart, creating a stark contrast to the "pigeon coop" apartments in the city.

“These low-density villas are located right next to the golf course. Each villa is two stories high and has a floor area of ​​more than 5000 square feet,” the project manager explained.

There was a lot of discussion in the carriage:
"Such a big house, I wonder how much it costs?"

"It won't be expensive, will it? The only way to get to Central from here is via the pier, and transportation is a major drawback."

As the sightseeing bus travels to the foot of the mountain on the east side of the stadium, six modern minimalist style detached villas are nestled among the greenery. Each villa is equipped with an infinity pool and a viewing terrace, offering panoramic views of the entire Discovery Bay.

"These are properties owned by Hong Kong Resorts International, primarily for rental purposes."

As soon as the person in charge finished speaking, the guests were secretly astonished—it seemed that the Chen family had reserved the best plot of land for their own use, further highlighting Discovery Bay's top-tier positioning.

At the end of the celebration, the General Manager of Hong Kong Resorts International delivered a speech: "We aim to create residences for the elite that are 'secluded yet connected to the city,' not pursuing high density, but preserving the natural landscape."

That evening, the clubhouse hosted a grand banquet, with lights illuminating the night sky above the stadium. Guests raised their glasses and chatted, full of praise for Discovery Bay and anticipation for the villas.

The opening in 1971 not only added a top-tier social venue to Hong Kong's wealthy circle, but also marked the beginning of the Chan family's creation of a "world-class luxury residential area"—this secluded mountain and sea paradise has since become a legendary beginning in Hong Kong's real estate history.

In March (1971), Hong Kong’s third stock exchange, the Gold and Silver Exchange, was established.

Chen Guangliang smiled after reading the news.

He hoped the Hong Kong stock market would be as hot as possible, so that he could plunder a large amount of wealth in this wave. For example, in 1970, the stock market turnover was only HK$78 billion, so the vast capital of the Chen Guangliang family could easily have an impact.

But Chen Guangliang knew that the annual stock market turnover would increase exponentially in the coming years; for example, the turnover in 1972 in his previous life was 455 billion, while in this life it might reach more than 50 billion, because Hong Kong's wealth had increased compared to his previous life.

In the first quarter of 1973, the transaction volume reached over 150 billion.

With such a high trading volume, the Chen Guangliang family profited HK$5 million, which is enough to prevent a collapse.

As for how to make money, it's actually very simple – every time a company goes public, the 'Chen Guangliang Family Office' will buy a certain amount of shares in that company, and then sell them off when the Ping An Index reaches a certain level.

The timing for selling is actually quite easy to grasp. It's simply a matter of when the Ping An Index reaches above 1200, at which point you can continue to cash out; or, when Hong Kong stock speculation has reached a frenzied level and ordinary people are following suit, that's roughly the time to cash out.

No matter how history changes, many patterns remain unchanged.

Currently, the Chen family's investments in the Hong Kong stock market are divided into two parts: Ping An Investment and the Chen Guangliang family office. Chen Guangliang has allocated these two parts carefully, and the investments do not overlap. (End of Chapter)