How can you become a star without money?

Chapter 175 I'd rather earn the rich's pocket money than the poor's living expenses

After three days, the first batch of Taobao Boss trainees completed their intensive training.

One-third of the students chose to work part-time in Xingdian's internship department to gain experience. Students who enrolled in the advanced training program could also apply to stay in Shanghai to work and enjoy the same benefits as regular employees, but their salary was the same as that of interns, 1000 yuan per month.

By paying the registration fee, students not only learn knowledge but also get a job, gain experience, and even earn back their tuition fees. This kind of good thing makes the students feel that Wang Yao is truly a conscientious mentor.

A quarter of them directly chose to open their stores using Taobao Girl's agency operation model, while the rest went back to consider it further.

On the last day, Wang Yao invited all the trainees to a camping salon by the river. He filmed a documentary for each trainee as a memento, telling them that one day they would become e-commerce tycoons, and that these would be valuable historical materials, just like the documentary about Ma Yun when he founded Alibaba.

His speech further ignited the crowd's passion and boosted their morale.

The emotional value is immediately maximized.
The festivities lasted most of the night, but in the end, the music ended and everyone dispersed, leaving only sorrow in the twilight. The water in front of the Zhaoqu Pavilion flowed eastward.

The Sun Also Rises.

After consulting with various parties, Wang Yao finally managed to process the 6 million yuan cash obtained from selling 20% ​​of Chengtian's shares. After paying taxes, he received less than 5 million yuan. Then, through a financial advisor, he established a family trust and lent the money to his wholly-owned company, Xinghuo Media Technology, at the maximum annual interest rate of 19%.

Then, Xingchuan pledged 65% of its shares in Mulan Street to Pufa Bank to raise 10 billion yuan, bringing its total to 15 billion yuan. After receiving the money, Xingchuan purchased another 2 square meters of shops in Thames Town at 5.5 yuan per square meter. Including the previous purchase, it now holds a total of 6 square meters of shops in the project.

The town has a total of 9 square meters of shops. Xingchuan Company owns two-thirds of them, while the rest are mostly owned by other institutions or individuals. Buying them would require a premium. Wang Yao leased them to Tianhuo Company again at a rent-to-sale ratio of 10%, doubling the original rent of 1000 yuan/square meter/year to 2000 yuan, which is almost on par with the rental prices in the city center.

Once this news gets out, other property owners in the town will naturally follow suit and raise their prices. The businesses attracted will either be either rich and foolish or truly high-quality, and as commercial rents rise, residential property prices will also increase.

Buying high and selling low is a common human trait.

He then repaid and redeemed the 1 million yuan he had borrowed by mortgaging Ms shares, and used Xingchuan Company's long-term high-premium rental contracts and real estate totaling 12 billion yuan as collateral. He also pledged his last 20.5% stake in Tianhuo shares to obtain a discounted financing of 15 billion yuan from Guo Guangchang's Minsheng Bank.

StarChuan had 18 billion yuan in available working capital. Wang Yao used 8000 million yuan of it to acquire Beijing Online Banking Co., Ltd., which is one of the few small and medium-sized third-party online payment companies currently operated by individuals.

Founder Zhao Guodong previously served as chairman of Aoma Electric Appliances. In 03, he saw the potential in the third-party payment industry and started his business with 3000 million yuan, which was one of the first companies to do third-party payment. However, he has persisted until now and is finally starting to have trouble. After all, the online payment industry is still in a downturn, and profitability is a long way off until the payment license is issued.

Even the two largest companies, Alipay and Tenpay, only managed to capture more than 70% of the market share by receiving hundreds of millions of yuan in funding from their parent companies every year. Although Netbank Online claims to be the sixth largest in the industry, it actually only has less than 5% market share, with annual revenue of less than 100 million yuan and fewer than 3 million users. Meanwhile, Alipay has already acquired 300 million users through its e-commerce closed loop.

The industry average net profit margin is around 20%, while NetEase Online's is less than 10%.

Because of the 10% discount, online banking is mainly used by B-end customers. After all, the transaction amount is large and the transaction fee is 10% cheaper than other banks, which can save a lot of money.

The consumer market is almost blank, but the payment field requires usage frequency and binding to consumption scenarios to achieve growth and user stickiness. It was because he realized this that Zhao Guodong felt there was no hope.

While the B2B market is stable, market competition will eventually lead to platforms with higher usage and greater convenience, which are simply unable to resist the overwhelming influence of the ecosystem of giant enterprises, just like third-party login.

After all, humans are inherently lazy; if a problem can be solved in one go, they don't even think about doing it a second time.

Zhao Guodong comes from a research and development background. He invests 1000 to 2000 million yuan in R&D and maintenance every year. In recent years, he has basically lost tens of millions of yuan every year. However, seeing the gap between him and other platforms widening, he began to consider giving up.

When the valuation of Kanpianer.com exceeded one billion yuan, Wang Yao began to commission headhunters to find a suitable third-party payment company to prepare for acquisition. At present, the payment license is still unclear and the industry is in a state of ambiguity, which is the time to pick up bargains.

Last month, a headhunter contacted the company. Wang Yao knew that the company had been sold to JD.com, so the probability of an acquisition was high. He talked with Zhao Guodong several times in Beijing, and both sides had a good impression of each other. The price was also fair. Given the current scale and valuation of Netbank Online, 5000 million was already the maximum. Wang Yao directly gave 8000 million, which made up for all of Zhao Guodong's losses over the past few years and left him with some hard-earned money.

After considering it for a week, Zhao Guodong finally decided to sell. He was invited by Wang Yao to continue serving as the CEO of the soon-to-be-renamed 'Spark Payment' company, as well as Wang Yao's financial advisor, and to become the CFO of Mulan Street in the future.

Zhao Guodong was willing to sell to Wang Yao because he saw the potential of Mulan Street. Although it was not an e-commerce platform, as a traffic portal, it could accumulate users more quickly. He naturally had feelings for the "child" he had raised for seven years and hoped that it could continue to grow rather than die young.

On the day the acquisition contract was signed, Wang Yao had already come up with the advertising slogan for the future: "Use Xinghuo Payment, Enjoy a Happy Life." The nickname would be "Xiao Xingfu," a homonym for "Little Happiness," and he would first target a group of women.

The contract has been signed, and Zhao Guodong has been handling the sale. Because there is no payment license, the review of such company transfers is very lenient. Basically, as long as both parties confirm the acquisition details, the equity transfer can be completed within one month. However, it will take at least one month to use the technology interface.

After the equity change, Wang Yao immediately stopped the PC-based R&D and contacted Xingyou's R&D team to focus on mobile service development. He prioritized niche platforms such as Kanpianer.com, Mulanjie, JD.com, and Vancl. It wasn't that he deliberately avoided large platforms like Taobao and Tencent Mall, because he knew he couldn't compete with them, so he simply adopted a strategy of surrounding the cities from the countryside.

Wang Yao originally didn't intend to clash with the giants in the payment field; he just wanted to have his own payment platform so that he wouldn't be restricted when doing cross-border transactions in the future. But Jack Ma just had to show up and make his presence felt, so he was forced to keep Jack Ma busy and unable to pay attention to him.

Of the remaining 17.2 billion, Wang Yao took out 5 million and injected it into Liu Haifeng's private equity fund under the guise of investment.

The 6000 million yuan invested in shorting the Li family's stock has been almost entirely spent by Liu Haifeng in the past two months through shorting Chengtian Entertainment. He has converted it into 5% of Chengtian's stock to prepare for the acquisition.

I thought the next event would be for Chengtian, but it turned out to be for Alibaba instead.

"5 million? Six times leverage, shorting Alibaba?" Liu Haifeng repeated Wang Yao's request.

"Yes, it shouldn't be a big problem," Wang Yao said with a smile.

“Alibaba’s market value is around 800 billion now, with about 160 billion shares in circulation. If you put in 30 billion, it will definitely cause a big shock. This is not comparable to Hebei’s trillion-dollar market value. Alibaba’s situation is similar to that of Alibaba, where major shareholders hold concentrated control. It is difficult to short sell quietly, let alone with such a large position,” Liu Haifeng said in a deep voice.

This time is different from before; the risk is too great. With a 6x leverage, once the bulls discover it, a few pulls and it's guaranteed to be liquidated. Especially for red-chip stocks like Alibaba with a small number of shares in circulation, they are specifically targeted. I've heard that Alibaba has around 100 billion yuan in internal liquidity to support the market at any time.

"How many days will it take for things to stabilize?" Wang Yao asked.

"Well, let's be on the safe side and wait two months. If there's bad news, it might be faster, but it's hard to guarantee that there won't be any good news in two months. The payment license issue is almost finalized recently," Liu Haifeng said in a low voice.

He suspects that Wang Yao might have been provoked after meeting Ma Yun, otherwise why would he be so crazy as to want to short Alibaba?
Alibaba is on a roll right now. It's estimated that it will achieve a new high in revenue in Q2. With the payment license being issued, it's conservatively estimated that it will rise by another 10%.

Shorting at this time is like lighting a lamp for the King of Hell—it's suicide.

Unless, Wang Yao has some favorable inside information?

Liu Haifeng's mind raced, realizing that Wang Yao was no ordinary client. "Does Mr. Wang have any more news?"

"Not really, it's just that I've noticed a lot of complaints about counterfeit goods on Taobao, and I've received several promotional offers related to exposing this issue," Wang Yao said with a smile.

"This isn't really bad news. It's widely known that Taobao sells counterfeit goods," Liu Haifeng chuckled. "Actually, I'm also optimistic about Alibaba's growth and want to take advantage of this minor negative news to accumulate some shares. After all, once Tianhuo and Meishe merge, the added value that Taobao's Taobao Girl business brings to Taobao will be obvious to everyone," Wang Yao put it another way.

“If that’s the case, then we can stop using leverage for now. 5 million is enough for me to build your position steadily. If there’s really some bad news, we can discuss it again,” Liu Haifeng compromised.

"Then I'll have to trouble you, Brother Liu," Wang Yao said with a smile.

“We’re all brothers. Thanks to you, I’ve been collecting a lot of interest lately,” Liu Haifeng said sincerely.

Before the global ban on trading, Wang Yao had hinted to him that there would be a major upheaval in the international entertainment sector. He investigated and found that there were indeed many big events, such as the bankruptcy of Hollywood's MGM, the Cannes Film Festival, and the tragic situation in Korea. Therefore, he made advance hedging in various places in batches.

Unexpectedly, the scandal involving unspoken rules in Japan erupted. After reaping huge benefits in East Asia, Fan Bingbing made a high-profile statement in Cannes, triggering a global trend of celebrities taking "rejecting unspoken rules selfies." Almost all global entertainment sectors experienced a decline, with Japan and Korea being the most extreme, some even seeing drops of over 30%, nearly triggering a market downturn.

With the help of Wang Yao's reminder, Liu Haifeng, who controls Asia's largest private equity fund, naturally made a killing.

"I heard it from someone else. I'll let you know if I have any more news later," Wang Yao said with a smile.

"Okay, there's been no movement from Chengtian lately?" Liu Haifeng asked again.

Another reason he was willing to hang out with Wang Yao was that he could torment him all day long.

"Alibaba has made a move, most likely to protect Chengtian for now. They'll probably wait until our two companies merge before taking action against Chengtian. Alibaba probably wants to dominate the entertainment industry and is starting with the safer cinema companies." Wang Yao smiled.

He had naturally considered why Alibaba didn't facilitate the merger of Meishe and Chengtian first. The reason was probably that acquiring Chengtian first would not be enough to make up for the losses, but would instead increase the cost of acquiring Tianhuo.

But if you finish eating it all in one day, it will actually be easier.

After exchanging information with Liu Haifeng, Wang Yao used the remaining 20 million yuan to acquire a 2000% stake in Zhang Hongchao's Mixue. Zhang Hongchao was unwilling to give up more shares due to concerns about control, and Wang Yao did not insist. Meanwhile, Mixue signed an annual contract with Xingchuan for 1000 million yuan per year plus a 5% commission. Xingchuan would provide Mixue with complete commercial packaging, IP creation, publicity resources, and other services.

Zhang Hongchao's eyes lit up when he saw the Snow King IP.

This little thing is so cute.

“I’m making a match-3 game. When the company becomes profitable, we can directly integrate the Snow King IP into it and spread it globally first.” Wang Yao handed him the iPad, which showed a prototype version of Match-3.

"This is similar to the match-3 game I played when I was in school. I was really addicted to it back then. This thing definitely has an impact on young people. I still remember the images and sound effects." Zhang Hongchao was overjoyed.

“That’s right. The essence of advertising is brainwashing. As long as it’s familiar enough, it will generate trust. Brand IP creation should revolve around consumer emotions. Cultural and creative products are the best medium for communication. In the future, it can also be integrated into various popular animated films, such as collaborations with ‘Pleasant Goat and Big Big Wolf’ and ‘Rainbow Cat’,” Wang Yao said with a smile.

"Mr. Wang is indeed born to make big money; he doesn't even let go of children's New Year's money," Zhang Hongchao joked.

“Drinking our pure, freshly squeezed tea is better than mixing it with other drinks, right?” Wang Yao smiled. “This is where your conscience will be tested, Mr. Zhang.”

"Don't worry, Mr. Wang, I've inquired about it. The initial budget of 2000 million for the central factory is enough to supply raw materials to fewer than 2000 franchise stores. Once we expand to over 1000 stores, the cash flow will be able to roll over and expand rapidly. Moreover, the supply chain cost can be reduced by up to 30%!" Zhang Hongchao's eyes flashed with a cold light.

This investment by Wang Yao not only enhanced his brand image but also provided him with comprehensive financial and legal counsel, and most importantly, boosted his confidence.

Because of his background, he naturally felt unfamiliar with and resistant to financing. However, Wang Yao's investment not only proved Mixue's value but also made him realize that even though they sell cheap tea drinks, they are still eligible for financing.

“1000 stores? That’ll be quick. Don’t worry about money. As long as you manage the production and sales well, leave all the financial matters to me. Oh, and I’ve prepared a new franchise plan for you.” Wang Yao handed over a folder.

Zhang Hongchao was stunned after taking it.

The plan raises the franchise fee threshold to 1 yuan per year!
In the beginning, in order to expand his business quickly, Zhang Hongchao offered franchises with zero barriers to entry. He mainly relied on bulk sales of ice cream machines and other equipment and raw material supplies to recoup his funds, and at most collected a deposit of 0 yuan.

However, in Wang Yao's plan, in addition to the franchise fee being a mandatory requirement, there is also a requirement to purchase 10 yuan worth of equipment and raw materials.

Most importantly, even the shop decoration must be done according to the company's design at a standard of 1500 yuan per square meter. The company is responsible for providing the design drawings and coordinating with the construction unit.

Normally, Mixue franchisees have spaces of 30 to 50 square meters. If Wang Yao's requirements are followed, the franchise threshold will suddenly increase from 5 to at least 15 to 20 yuan to become a franchisee.

In 2010, there aren't many people who can come up with so much money all at once.

“Mr. Wang, I think this rigid franchise threshold is a bit too high. In the past, a franchisee could open a store with about 5 yuan, but now it’s at least 15 yuan, which may affect the speed of franchising,” Zhang Hongchao said with a frown.

"High barriers to entry mean manageable risks. Do you know why your previous franchisees had so many serious hygiene and quality control problems? It's because your franchisees were doing business like street vendors, working hard."

"This business is for people who have spare cash but don't want to put it in the bank to earn interest. They want a stable investment that they don't have to worry about, and whose profits just need to outpace the interest." Wang Yao laughed.

Franchising is for people who don't lack money.
"Franchise? Is that so?" Zhang Hongchao raised an eyebrow slightly upon hearing this, looking astonished as if he had suddenly understood something.

"Based on your previous daily revenue of 500, that's about 1.6 million a year, with a gross profit margin of about 45%, which means your net income for the year might be 60,000. That's better than working a regular job, right? But you also face the risk of poor management."

"Two franchisees, one a hardworking recent college graduate running his own business, the other a middle-aged person with a stable job and some family savings who hires others to run the business. Which one do you think is the more valuable franchisee?" Wang Yao countered.

"It's more likely the latter, because the latter won't try to cut costs just because they're not making money, while the former, because they can't guarantee profits, can only prioritize profitability, so they'll use other methods to increase profits." Zhang Hongchao understands human nature well and gets it right away.

"That's right. If you want to open a few hundred stores, low barriers to entry are an advantage. But if you want to open tens of thousands of stores, you need high barriers to entry and must first select suitable, high-quality franchisees."

"Because once they make a profit from the first store, they'll immediately open a second one, and even bring along their relatives to dominate the local market. This gives them a certain advantage in terms of customer acquisition costs," Wang Yao explained.

"I get it. Thinking about it, we really do need to find franchisees who have plenty of money." Zhang Hongchao scratched his head.

"I'd rather earn the pocket money of the rich than the living expenses of the poor. Franchising still carries certain risks. Based on the principle of being responsible for both of us, it's not a good business for people who want to make Mixue their main job to support their families," Wang Yao said with a smile.

Zhang Hongchao pondered Wang Yao's words for a moment, seemingly gaining some insight.

(End of this chapter)