In this Silicon Valley, which is deeply influenced by Zhou Xin, a start-up company that is good enough is not eager to obtain financing from the outside. They hope to make the company as large as possible, and then talk to venture capital institutions after it becomes bigger, so that they can get more funding. Much initiative.
Not only the initiative in valuation, but also payment methods, equity models, investor rights and so on.
Because the convenience and popularity of electronic payment have allowed Internet companies to find their own profit models and stable payment methods.
During the Internet wave in the late 1990s, there were many Internet companies that knew how to charge membership fees through differentiated services. For example, AOL thought of adopting a model similar to TV membership to provide paid services to their users, but ultimately failed. The fundamental reason for putting the idea into practice is the lack of payment methods.
Now the biggest shortcomings in the past are not only no longer shortcomings, but have become part of Amerikan's perfect financial system, which makes it easier for Internet companies in the new century to create profit models.
The profit model of Internet companies is no longer limited to advertising.
This has also formed a new result. In the original time and space, whether it is Google or Facebook, these two rapidly rising Internet companies cannot escape the intervention of venture capital institutions. It is just that their success allows them to force venture capital institutions to adopt the same shares. Different ways of entitlement.
It was also after Facebook that the A/B share structure became popular in Silicon Valley.
It is different now. The A/B share structure has been known to Wall Street financial institutions and Silicon Valley entrepreneurs since NewPay. Due to the painful memory of the bursting of the Nasdaq bubble and the artificially high valuations of Internet companies in the past, Wall Street investment institutions would rather give up more power to the founders, but also want to see a profit model with rapid development and attractive prospects.
On the flip side, companies with this kind of profit model are also not in need of venture capital.
Of course this also brings a new model:
“I think we should do equity-pledged loans, which are more in line with our current needs.
We need more liquidity so that we can place ads, buy cloud resources in different places, hire more people to iterate and upgrade our products, etc. These all require money, and we don’t want to give away more. of equity.
Well, one of the more popular methods now is equity pledge. With the development speed of Face Chat, many companies will be willing to give us loans. ” said David Ibersman.
As a former investment manager, he is proficient in various financial tricks in Silicon Valley.
The loan model of equity pledge has been around for a long time, but the gameplay of equity pledge loans that have emerged in Silicon Valley in the past two years is different from before.
That is, it is a bit similar to a gambling agreement. Bank loans have no interest or very low interest. After the one-time principal repayment is due, the bank that lends you the loan has a priority investment quota, and this quota is locked.
For example, if you release 20% of your shares in your next financing, the bank that provides you with an interest-free loan will have an investment quota of 40%, which means 8%. The bank can choose whether to follow.
Of course, it is not just banks that are qualified to do this type of business, some venture capital institutions and even individuals can also do it.
This is a loan model that is extremely beneficial to investors. There is no interest cost. It is said to be an equity pledge, but in reality it is a pure credit type. Lending institutions only have investment quotas, and subsequent participation in financing still requires real money to invest.
Why is it essentially a pure credit loan? Because if your company collapses, the equity will be worthless, and it is not a credit loan with unlimited joint and several liability.
Therefore, compared with China, Silicon Valley's financial innovation and capital costs are also a major advantage for them.
Zuckerberg and his roommates nodded frequently after listening to David's detailed introduction to this type of loan. Everyone thought there was no problem.
“I think this model can be adopted and it’s almost perfect for what we need right now.”
After Zuckerberg finished speaking, David said: "After listening to this, everyone will definitely think that this model has advantages and disadvantages for start-up companies, and the initiative is completely in their own hands.
This is also conditional. When financial institutions engage in this type of business, their requirements for start-ups will be very high. We can regard it as a kind of financing with a higher threshold than venture capital. Financial institutions that are willing to do this type of business generally have Adhering to the idea of hoping to grow together with start-ups.
I think Face Chat has this qualification. Judging from user growth, payment ratio, and development speed, there will be many investment institutions willing to help us with this business.
But we also need to pay attention to one thing, that is, we cannot go to Goldman Sachs for this loan, because Goldman Sachs has already had the nerve to negotiate for 30% of the shares. If we go to Goldman Sachs again this time, Goldman Sachs’ share ratio will be further increased in the next financing. .
My suggestion is to find other investment institutions, whether it is Morgan, Merrill Lynch or emerging investments.
If we look for emerging investments, they may provide us with some unique services. Of course, this depends on whether Face Chat can interest Newman. "
Zuckerberg asked in a low voice: "Do you mean the opportunity to have lunch with Newman?"
David nodded: "Yes, the biggest temptation for emerging investment companies in Silicon Valley has always been the opportunity to have lunch with Newman.
Newman owns many industries, including Mphone, Riot Games, WeChat, Weibo, etc. These companies have a lot of resources, control a large number of users, and can push news to a large number of users.
But emerging investments cannot affect Newman's other businesses. If you raise funds from emerging investments, then go to the Mphone App Store, WeChat, or Weibo to talk about advertising prices, or Xinyun to talk about cloud service prices, they won't offer any discounts.
The only difference between Emerging Investment and other investment institutions is Newman. If your project interests Newman, Emerging Investment will show the information to Newman. If he is willing, the founder of the company can have lunch with Newman and learn from him. Listen to some experiences.
Of course, this kind of opportunity is rare. According to news circulating in the industry, no more than five companies have received such an opportunity so far. The probability is comparable to Buffett's lunch.
I also think FaceChat has this opportunity, and Newman’s idea may be far more valuable than the loan itself. "
Newman is Zuckerberg's transcendent object. This does not mean that Zuckerberg does not recognize Zhou Xin's achievements and abilities. Zuckerberg has even read many news reports about Zhou Xin and some books on Zhou Xin's product thinking. .
The more he learned, the more Zuckerberg believed that Zhou Xin was a top genius, especially when it came to products. While other Internet founders were still focusing on the product itself, Zhou Xin had already set his sights on ecological construction.
Zuckerberg was obviously moved. He asked: "Can we get an interview with Newman even if we are just looking for emerging investments to apply for a mortgage loan?
Zuckerberg was obviously moved. He asked: "Can we get an interview with Newman even if we are just looking for emerging investments to apply for a mortgage loan?
Or do we need to wait until we raise funds and find emerging investments, and emerging investments get our shares? "
David said: “You can think of this type of equity loan as pre-investment. After the agreement is signed, the lending institution has the initiative whether to follow the investment next time.
Therefore, as long as we choose Xinxing, they will help us send the face chat information to Newman after a review. Of course, whether they are willing to see you in the end depends on Newman's intention.
It is equivalent to two rounds of interviews, one for emerging investments and the second for Newman himself. "
Edward said: "I think we can look for emerging investments. On the premise of excluding Goldman Sachs, there is essentially no difference between emerging investments and other investment institutions.
I think we can talk to a few more companies and see what conditions they offer. If the conditions are not essentially different, I think looking for emerging investments is the best choice.
Newman can provide some ideas, which may be of great help to Face Chat. "
Sean Parker said: “We need this kind of help in the early days of our business, just like Microsoft started with IBM, we can’t get rid of Newman in Silicon Valley, we need to cooperate with him.
His status in Silicon Valley can be called a king. He started his business only two years earlier than me, but his achievements far exceeded mine. Newman is the best product manager in the minds of those of us who started our business earlier. The suggestions must be valuable. "
Sean Parker is a few years older than them. He started his business in 2000, initially as a music sharing website. Unfortunately, he encountered the collapse of the Nasdaq bubble and competition from ITunes, and his business did not achieve the success he imagined.
Compared with Zuckerberg and his roommates in the ivory tower, Sean Parker understands Zhou Xin's status, energy and abilities in Silicon Valley better.
After listening, Zuckerberg said: "Okay, let's find emerging investments. Let's first understand the conditions for each company to open. If there is no essential difference, then we will find emerging investments to cooperate.
After our cash flow becomes more abundant, we need to add more people. We need a lot of people. It’s not just as simple as adding five people. This number has to be multiplied by ten. We need to advance simultaneously on other smartphone platforms.”
Zhou Xin didn’t know that he would receive an email from Emerging Investments in a few days, asking him if he wanted to meet a young man named Zuckerberg. Then the sender would describe his background and the company he founded in the email. Make a detailed introduction to the company.
While Zhou Xin was replying to emails, he was chatting with Li Jingyi: "I read the news on the WeChat public account that the number of Face Chat users has exceeded 100,000, and it is very popular in the Boston area.
I saw the Mphone application situation from the background. FaceChat is the application with the fastest growing number of downloads and weekly revenue in the Boston area. It seems that your investment has achieved the expected results. "
Li Jingyi was very happy about this: "Yes, FaceLiao's valuation has reached 20 million US dollars. My 30% equity has tripled, and depending on the growth rate, the market value will maintain a rapid growth." situation."
Zhou Xin said: "So you might as well use your own money to invest in face talk, why bother working for Goldman Sachs? No matter how successful the investment is, the money you will get is only one million US dollars, and after tax is deducted, it may only be 600,000 US dollars." about.
The cost-effectiveness of working for others is too low. "
Li Jingyi explained: "It's not the same thing. First of all, it's your money. Secondly, I need to work, whether it's working for you or working for Goldman Sachs. I want to work for myself but I don't have the capital.
I am satisfied with being able to get US$600,000 from this investment. As I slowly accumulate capital, I also want to open my own investment institution! "Li Jingyi looked confident.
After hearing this, Zhou Xin also replied to the email: "As long as you have confidence, I'm going back to China in the next two days, and it will take about a week."
Zhou Xin is going back to China for the new core lithography machine. The new core lithography machine starts from 180nm. What he purchased is Nikon's technology. Not only did he purchase Nikon's technology, he also hired some scientific researchers and researchers from Neon. Engineers arrive in Zhangjiang.
Under the leadership of Lin Benjian, and after Xinxin Technology entered the chip foundry field, the yield rate of 180nm lithography machines has grown very fast. After this year, Xinxin Technology's 180nm lithography machines have the same process as Nikon and ASML. The lithography machines have comparable yield rates.
Now he is doing research on 130nm lithography machines. When Zhou Xin was reading the half-year work report of the new core lithography machine, he was wondering whether he wanted to talk to Lin Benjian about the wet process.
The wet process refers to the immersion lithography machine technology. Compared with the previous dry process, this process adds a layer of liquid between the last lens of the lithography machine's projection objective and the photoresist. This layer of liquid allows The frequency of light waves is higher and the imaging resolution is improved.
Wet process is the key for photolithography technology to break through 65nm. Now the chip process has reached 90nm. If we want to break through, we can rely on dry process, but it will take longer.
Of course, the wet process is not as simple as adding a layer of water. There are many issues that need to be considered in the wet process, such as bubbles and contamination caused by immersion in the environment, the compatibility of the resist with the fluid or topcoat, and refraction. Fluid viscosity with an index greater than 1.65, absorption and fluid circulation requirements, etc.
This is a set of technologies. Without key figures like Lin Benjian, the development of lithography machine technology towards 65nm has been slow.
The wet process has not been researched, and the world will have to be at least two years late to enter the 65nm era. This means that the original 65nm process will be entered by the end of 2004 and will be postponed to 2006. At the same time, ASML will not be able to use this technology to achieve bending. Road overtaking.
The field of lithography machines is still in a state of competition among the best, and new core lithography machines have the opportunity to steal the market.
This is good for Xinxin lithography machines. When everyone stops moving, it will be Xinxin’s turn to catch up.
The semi-annual report of Xinxin Lithography Machine stated that they have completed the research and development of 130nm lithography machine. The follow-up will be a large number of experiments and the production process to improve the yield rate. This is all hard work.
Similarly, the chip manufacturing process cannot enter 65nm, which is not so friendly to Matrix. Mphone will not be able to achieve the evolution of computing power, and the gap between it and its friends will gradually narrow.
Once the new core lithography machine that implements the 130nm process adopts the wet process, it can cross this threshold at a very short speed and enter the 78nm process, which is equivalent to surpassing the gap of half a generation among all lithography machine manufacturers.
But once this veil is lifted, other lithography machine manufacturers will also be able to catch up quickly.
The most important purpose of Zhou Xin's return to China was to discuss this matter with Lin Benjian. The wet process was so critical that Zhou Xin didn't want to go through email or phone calls, so he could only have an interview.
(End of chapter)
