2003: Starting with Foreign Trade

Chapter 392 "Getting Little Ma's Guys to Make Money for Me"

What do big shots talk about in private?
It wasn't all about business. During the short time they waited for Qiming Venture Partners' investors, the two bigwigs in the office didn't talk about business or their views on the future.

Instead, they started talking about family.

Ma's family rarely appears in front of the camera, and Shen Nanpeng is even less so; there is almost no information about their families on the internet.

As they chatted, the conversation drifted to Tan Jincheng.

"It's quite rare to see a partnership like that of President Tan and President Gu. President Tan is in charge of manufacturing, while President Gu is in charge of the internet industry. Both of them are celebrities, and they can also travel together on business trips. It seems to be quite good so far."

It's hard to balance business and life. Once the business grows big, it becomes difficult to take care of the family. Even if the wife is a full-time housewife, there aren't many days when they can spend time together regularly.

This is especially true for Shen Nanpeng, whose work requires him to travel all over the world, and the feeling of home has almost become unfamiliar to him.

He actually envied Tan Jincheng's life of traveling on business together with someone else.

In fact, the wives of entrepreneurs who have built up large businesses are rarely full-time housewives. For example, the wives of the owners of the leading electric vehicle manufacturers that Tan Jincheng has been in contact with a lot all have their own businesses.

Even for small business owners like Zhang Haiping and Zhang Mingcan, their wives are busy working in the factory. Zhang Haiping's wife is responsible for managing the workshop and paying wages, while Zhang Mingcan's wife even works as the company's cashier.

The idea of ​​men staying home to earn money while women stay home to take care of children is difficult even for ordinary people, let alone businesses.

There's a saying in Tan Jincheng's hometown about marital relationships, which translates to: "You can't have two different personalities in one bed."

It describes the personality traits; people with incompatible hobbies and temperaments are unlikely to end up together.

It's a bit biased, but not without reason. Men with strong career ambitions also find it hard to accept that their partner is too mediocre, and women, encouraged by their partners, can also develop a certain level of career ambition.

This is probably Tan Jincheng's understanding of the law of the jungle.

About fifteen minutes after the agreed time, Kuang Ping and his assistant rushed in, each carrying a public transport bag.

As soon as he entered the office, Kuang Ping apologized repeatedly. His car had broken down on the road, and he had been caught in the morning rush hour. Luckily, he had left an hour early, or he would have been terribly embarrassed.

It's really inappropriate to be late for such an important meeting, but he genuinely didn't have time to make it yesterday.

"I understand, Mr. Kuang, please have a seat. We all just arrived." Little Ma, the host, helped Kuang Ping out of the awkward situation.

Once you're in the circle, it's actually quite small. Everyone knows each other and is busy, so there's not much to say in small talk. The meeting then officially begins.

Tan Jincheng gestured to Gu Qingqing. He was the actual controller of Orange Technology, but he was also an investor. He was indeed the one who created the PPT for the Orange Products Club project, but Gu Qingqing also contributed a lot of ideas.

The introduction was naturally given to the investors by the CEO of Orange Technology.

"Good morning, everyone. I will now give a brief introduction to the business plan of Orange Technology's new project, Orange Products Club."

Today, Gu Qingqing is wearing a pink long-sleeved shirt, paired with dark straight-leg jeans and sneakers. Her hair is still tied in a ponytail, making her look mature yet still youthful and energetic for her age.

While giving her presentation, she rolled up her long-sleeved shirt, revealing her fair arms and the matching watch on her left wrist that she wore with Tan Jincheng.

"Chengpin Hui is a vertical e-commerce website that focuses on clothing flash sales. Its main business includes brand discount products, and it plans to cover major sectors such as apparel, shoes and bags, beauty, and home furnishings."

"In the early stages of the website's operation, we will launch a lifestyle services option, integrating the fruits and vegetables that Happy Farm currently offers to users into Orange Products Club to drive traffic to it."

"The unique features of Orange Products Club are brand discounts, limited-time flash sales, and guarantees of genuine products. You can think of it as an online outlet mall."

At this point, Tan Jincheng interjected, "By the way, speaking of outlets, Flash Group will contact outlet brands through our trading partners in the United States to try to secure the domestic operating rights. At that time, we can form an online and offline combination with Orange Products to further strengthen the special sales system."

Outlets haven't been introduced to China yet. It's a brand of Apple, and its original English meaning in retail refers specifically to the sale of out-of-season, discontinued, and discontinued products.

Kuang Ping and Shen Nanpeng both had experience with outlet malls, and Xiao Ma is also knowledgeable. They all know about outlet malls, and the model doesn't need special explanation.

This description is very concise and makes it easier to understand Orange Products' positioning, although their business scope is somewhat different.

If Orange Products can secure the domestic operating rights for outlet malls, it could even achieve "zero inventory," significantly reducing the company's burden and increasing the probability of rapid profitability.

"The purpose of this round of financing is mainly for platform development, expanding production lines, and improving supply chain and logistics capabilities, so as to further promote the development of Orange Technology."

Gu Qingqing spoke for nearly 20 minutes, explaining Orange Products' business scope, core competitiveness, and financing needs. There was no fluff; the PPT was prepared by Tan Jincheng, who disliked excessive boasting. A truly successful business doesn't need to use PowerPoint presentations to deceive people like a fake accountant.

Orange Products Club is a viable long-term business. The investment from Tencent is also aimed at enabling it to access WeChat's promotional interface and, like Jingdong, enjoy the traffic benefits brought by WeChat users.

Many companies' DNA determines their attributes. WeChat had many competitors in its early days, such as Fetion and MiTalk, especially MiTalk, which almost overthrew WeChat. Even Ali also created a social interface.

The social networking gene was truly enhanced by Tencent's QQ platform. Tan Jincheng could create a simple social networking website and accumulate a certain number of users, but if he wanted to build an industry chain for social circles, that would be much more difficult.

Even in e-commerce, Tan Jincheng didn't dare to directly compete with Ali and Jingdong, so he could only find another way by focusing on vertical e-commerce.

Those who are reborn know the general course of history and what things will become popular, but there is no need for them to do everything themselves; doing so would only exhaust them.

Even without WeChat, Tencent will still have QQ, and they'll still have to fight tooth and nail with it. Besides, without QQ's user base, WeChat wouldn't have gotten off to a fast start in the early stages.

Instead of doing that, we might as well take advantage of the situation.

The greatest advantage of a reborn individual is not to control information asymmetry and monopolize all businesses, but rather to leverage known information asymmetry, learn to capitalize on it, and use these asymmetries to develop their career with minimal cost.

Cultivate as many partners and friends as possible, and minimize competitors. Utilize these partnerships to make money.

Simply put, it's about getting people like Pony Ma to make money for you, which is much easier than making money yourself.

As long as there is no conflict of core interests, Tencent is actually a very good partner. In addition, Orange Technology, which pursues a small and beautiful business model, can better hide itself when the situation in the Internet industry changes.

Orange Technology can effectively avoid its own problems by doing just two things: first, by not competing with ordinary people for business; and second, by not getting involved in internet finance.

If they don't pursue these two ventures, but instead focus on selling clothes and cosmetics, making money off women, and then combine that with agricultural assistance projects, Orange Technology could practically be invincible.

"So how much money are you two planning to invest in Orange Technology? How many shares do you want?"

After Gu Qingqing finished her explanation and returned to her seat, Tan Jincheng took over the conversation, smiling as he asked Xiao Ma and Shen Nanpeng.

Shen Nanpeng and Xiao Ma exchanged a glance, and Xiao Ma gestured with his hand.

Both companies are well-funded, so there's no difference between lead investor and follow-on investor. Tencent can contribute as much as Shen Nan and Peng can contribute.

Shen Nanpeng didn't mince words, responding assertively, "How many does your company need?"

“We need $20 million to build the platform and streamline the supply chain,” Gu Qingqing replied.

This figure was calculated by the finance teams of Orange Technology and Qiming Venture Partners. In this round of financing, Qiming Venture Partners and Orange Technology are on the same side.

The RMB to USD exchange rate this year is no longer 8; the annual average is around 7.6, which is a very rapid decline. 2000 million USD is equivalent to about 1.5 million RMB, which should be enough for Orange Technology to burn through cash for one or two years.

As for what to do if the company runs out of money and still isn't profitable after two years, well, we'll talk about that in two years. If all else fails, we can do another Series C funding round. It's not like we're definitely not going to do that; it's just one of Tan Jincheng's ideas.

"No problem. How many shares does President Tan plan to give to President Ma and me?"

The figure of 2000 million made not only Shen Nanpeng laugh, but even Ma Ge laughed. They had actually seen the initial version of the plan before, and through calculations, they could estimate the approximate number of Orange Products would succeed.

Asking for less money means that no matter how well-made the plan is, it's just nonsense. It shows that the difficulties were not anticipated and that without sufficient funds, nothing can be accomplished.

I'm not afraid that Orange Technology will give up money; I'm afraid that they won't give up money.

When it came to the topic of allocating more shares to Sequoia Capital and Tencent, Kuang Ping relaxed his shoulders. It was his turn to step forward, as this had been discussed by both parties beforehand.

Internet valuations are a very mysterious thing. It's common for valuations to increase three or four times when moving from Series A to Series B. This is what Kuang Ping said.

Tan Jincheng had no idea how they calculated it; it really felt like they were just arbitrarily setting prices, just like the three Asian travel agencies.

Kuang Ping's idea is to give each company 10% of the shares, with a maximum of no more than 12%. If calculated this way, Orange Technology's valuation will reach 7.6 million!
They really were calling for a price increase of three to four times.

"It's 20% in total. How Red Shirt and Tencent split it is up to you."

(End of this chapter)