2003: Starting with Foreign Trade

Chapter 704 Sale and Transformation

While the supplier conference in Weilai is in full swing, the sale of Happy Farm is also nearing completion.

With the attention of the two bosses, the project progressed rapidly.

The two parties had been collaborating on this project for several years, and Huang Xitong had actually wanted to buy Happy Farm and rename it QQ Farm for a long time.

The initial estimates for Happy Farm over the years suggest it has brought at least 200 million active users to QQ Zone, and the actual value it has created is immeasurable, with revenue from in-game items alone amounting to an astronomical figure.

Half of these revenues had to be given to Kaixin001 every quarter. Tencent, or rather the QQ Space project team, had long been unhappy with Orange Technology. If it weren't for Tan Jincheng's layers of defense, Kaixin001 would have been renamed QQ Farm long ago.

Now that the other party is willing to sell, that's perfect. Although it's not as promising as Happy Farm was a few years ago, its impact on QQ Space is still quite significant in terms of overall trend.

"You guys definitely won't lose money. Anyway, when the business goes under, you'll just frantically develop new items, so you'll always be able to make it back. It's not like it's much money."

"You rascal, why are you swearing all of a sudden while we're talking?"

Cheng Hao's complaint left Huang Xitong speechless. Isn't that what everyone does?
"Haha, just kidding. Anyway, your main business isn't games. Games are just tools for attracting new users and maintaining active users. It's not like you're short of tens of millions."

After Happy Farm is sold to Tencent, it will be renamed QQ Farm. At the same time, Kaixin.com will continue to operate under the name Happy Farm. The users of these two will not conflict.

Kaixin.com's user base is primarily office workers, with 81% having a college degree or above and 64% having a middle-income (monthly income of over 4000 yuan).

Women account for 52% of these users, which means that Kaixin.com’s user base is very close to Tan Jincheng’s business development. Orange Products has gathered a large number of female online shoppers.

Middle- and high-income male users will be the main consumer group for automobiles in the future.

At this time, QQ Space's main user group was mainly students with limited spending power, so the two actually complemented each other well.

The two sides have almost finished discussing the details of the terms, and now only the final price difference of 2000 million yuan remains. Cheng Hao wants 3 million yuan, while Huang Xitong is only willing to offer 2.8 million yuan.

This disagreement is no longer a significant one, so the top officials on both sides are in a relatively relaxed position.

"Why would your boss think of selling Happy Farm at this time? Logically speaking, he could have run it himself for a while longer."

Like Cheng Hao, Huang Xitong knew that Happy Farm's growth was already limited, but he still had some questions about the timing of the sale. He didn't say anything before because he was afraid of affecting the negotiations between the two parties, but now that the negotiations were close to success, there was no need to hide it anymore.

Cheng Hao smiled and said, "Our boss has his own plans. New businesses need to be developed. Why don't we find someone to take over while you're still interested?"

Cheng Hao had his own ulterior motives and didn't object to selling Happy Farm, but like Huang Xitong, he had doubts about the timing of the sale. However, how could he possibly tell outsiders about such a thing?

Huang Xitong will definitely stand on the same side as his boss.

After understanding 9rooms' operating model, Cheng Hao actually understood what the boss was talking about. The core of Orange Technology in the future is mobile phones, not PCs. This is the real transformation the boss was talking about.

The popular iOS games like Fruit Ninja and Talking Tom that are currently trending overseas are an example of the boss's attempt at developing mobile apps.

In the future, Kaixin.com and Orange Products will shift their focus to the mobile internet.

Can Happy Farm be ported to mobile internet? Cheng Hao had also thought about this question. Technically, it wasn't difficult, but he felt that the effect might not be significant. For office workers, stealing crops on their computers at set times is a kind of fun.

But if you take out your phone every now and then, isn't that a bit too difficult, or too deliberate?

Perhaps, as the boss said, Happy Farm is a product of the PC era. It still has its place in the mobile internet era, but its significance is actually diminished. There are so many more mobile entertainment options, games, and entertainment points available.

Not many people will focus on stealing vegetables anymore, so what's the harm in selling them?

It's just a matter of how much money they make. Orange Technology has already made enough money from Happy Farm.

"Your boss must have other projects he wants to develop, otherwise he wouldn't be in such a hurry to sell. But it's okay if you don't say anything, you'll find out in a while."

Cheng Hao refused to reveal anything, and Huang Xitong didn't care. There are no secrets on the internet; even closed-system software will be known in a few months.

According to his understanding, Boss Tan usually only thinks about making money when he has some big plans, and even when transferring shares, he rarely transfers his own businesses directly.

Cheng Hao smiled but did not respond.

The boss is indeed making moves, but not in Orange Technology. Instead, it's in his project called Weilai Intelligent Driving, which is preparing to develop automotive systems and has already started recruiting.

To this, Cheng Hao could only say, "Boss, you're awesome! Making automotive systems isn't that easy."

There are many connections between Orange Cloud, Weilai Zhijia, and Orange Technology. It is highly likely that a portion of the cash generated from the sale of Happy Farm will go to Orange Cloud, which will probably also support Weilai Zhijia.

The boss really lived up to what he said: the internet is just for fun, for making money. If he felt a business was good enough, he would sell it decisively.

"Stop with the nonsense. How about we just go with the price I suggested? I've already spoken to your boss and my boss. Besides, you're already facing a lot of trouble right now, so announcing it sooner would be good for your company."

What do you mean we're in a lot of trouble?

"Heh, your company's domineering style of doing things these past two years has offended quite a few people. Although the Q coin incident last month wasn't your responsibility, your boss must still be worried, right?"

Huang Xitong was speechless for a moment. He was also one of Tencent's veterans. The Q coin issue had gotten the boss slapped a few times back then, and it was indeed a taboo topic in the company.

Internet marketing is about using one trending topic to overshadow the previous one.

"Also, isn't your QQ Doctor a counter to 360 Antivirus? Anyone with eyes can see that Zhou Hongyi is a rogue software developer. If you don't settle down now, your QQ space will lose its popularity in a while."

"Why risk missing out on the chance to please the boss and gain popularity on QQ Space for 2000 million yuan? You can easily recoup that 2000 million yuan with a simple prop."

"Also, we'll charge you extra for every extra day you delay. Think it through, otherwise the 2000 million will be no different from nothing."

Huang Xitong was speechless. What he said was indeed true. As long as a formal acquisition contract was not signed, the profits for each day before that would have to be split equally with Orange Technology. This had already dragged on for quite some time.

If it were delayed for a few more days, the price wouldn't be much cheaper.

"Alright, alright, 300 million it is. Hurry up and get the contract signed."

Cheng Hao laughed and said, "That's right. Let's finish signing quickly. I have things to do after we get back, so I can't stay here forever."

A flash game priced at 300 million is, frankly, a bit expensive. But who can blame Tencent for being rich and needing it right now? They might as well ask for as much as possible. That's the attitude of the boss and Mr. Sun.

After selling Happy Farm, Orange Technology received a lump sum of cash, but its long-term cash reserves also decreased. Previously, it could receive monthly payments from QQ Space, but that's no longer the case.

Cheng Hao needs to figure out a way to develop new open source solutions.

According to the third quarter report of 2009, Orange Technology's cumulative revenue for the first three quarters of 2009 was 306.98 billion yuan, and its annual revenue should be around 400 billion yuan.

As of the third quarter, Orange Technology's basic earnings per share were $6.4, and its net assets per share rose to $29.12.

Its operating revenue is less than one-sixth of Ali's and less than one-eighth of its profit.

The company's core business, Orange Products Club, has reached 1210 million registered users, which is quite impressive. The company's cash flow is also good, but there are many expenses.

For Orange Products alone, the planned operating costs for 2009 reached 250 billion.

You can never earn as much as you spend. According to the previous plan, Orange Technology, including Orange Products, was to achieve overall profitability in 2012, the year of its fifth anniversary and fourth anniversary of its listing.

Time is running out for Cheng Hao and Sun Tongyu.

"Perhaps it's true, as the boss said, that the mobile internet is a breakthrough point for Orange Technology and Orange Products?" But if that's the case, then we'll have to increase R&D investment again, and it looks like the losses will increase even further next year.

"By the way, have you ever thought about changing jobs?"

As Cheng Hao's thoughts wandered, he suddenly remembered another instruction from his boss: to find out Huang Xitong's attitude. The boss had always been very interested in this technical expert, but had never had the opportunity to do so.

Perhaps because they've gotten used to Tan Jincheng's way of speaking, the executives of FlashChe now prefer to get straight to the point when discussing matters. After all, they're outside Starbucks on the outskirts of Tencent, with no one around and no need to worry about being overheard.

Huang Xitong was visibly taken aback, his cigarette trembling slightly: "What do you mean?"

“What could it mean? Our boss has always admired you, you know that. Would you like to work at Orange Technology?”

Huang Xitong smiled. That was indeed the case. President Tan would always take the time to chat with him and say hello. Sometimes he would even ask him for some strange questions, such as asking him for some decoration props from QQ Space.

He's not stupid; how could he not know this kind of tactic? They just want to keep in touch with him.

"If you come, the position of Technical Director of Orange Technology will be yours."
-
Beicang.

The district government officials arrived at Tiangang Hotel, met with Changze Yu, and left after learning the purpose of his visit.

There will be a meeting between the two sides later, but that's for tomorrow.

"Nagazawa-kun, please rest for a while. I'll come find you later."

Mitsubishi intends to establish a strategic partnership with Wei Lai on parts and components. Tan Jincheng still needs to inform Zhang Yong. In addition, Nagasawa Yu also needs to make some preparations. The timing is neither right nor wrong, and it's still a bit early for dinner.

"Okay, I'll contact you again later, Mr. Tan."

Nagasawa Yu also wanted to rest for a while and sort out his thoughts, so he didn't refuse.

Back at the company, Tan Jincheng received a call from Cheng Hao. The negotiations with Huang Xitong were nearing completion, and he had agreed to the price of 300 million yuan. However, the contract still needed to be submitted for review, so it couldn't be signed for the time being.

As for the offer to poach Huang Xitong, he naturally declined.

"It's okay, we're just testing the waters. It's not that easy to undermine someone's loyalty."

Huang Xitong's situation is different from Sun Tongyu's. QQ Space is still a key project, and he is in charge of it. In addition, Tencent has been very kind to him, so he can't just leave so easily.

But all you need to do is plant a seed in his heart.

"Okay, that's good. By the way, with the New Year approaching, how are the preparations for Orange Technology's annual meeting going? Is there anything I can help you with?"

"That's right, we plan to hold this year's annual meeting after the New Year, in the new headquarters building, as a way to celebrate together."

After the New Year, we will officially move into the new office building, so we should celebrate. Since we are quite busy before the New Year, Cheng Hao simply decided to hold the annual meeting after the New Year to save on administrative expenses and make things easier.

"Oh, I see. That works too. Just let me know if you need my help."

"No problem. By the way, boss, I'd like to visit Jiujianfang to learn from them, but I'm not familiar with their boss. Could you help me get in touch with them?"

Some time ago, Cheng Hao had some disagreements with the boss over the Happy Farm project. Although he knew that the boss probably didn't take it to heart, Cheng Hao was definitely trying his best to repair the relationship.

There's nothing better than flattering the boss. Since the boss told me to learn about 9rooms and highly recommends them, why not just go and learn from them?
"Hmm? You want to go check out Jiujianfang?"

Tan Jincheng smiled and said, "Alright, I'm not familiar with their boss either, but I can help you get in touch with him."

It's good to learn a little from him; he's a future algorithm giant. Right now, Xiao Zhang is still a very green newcomer to the internet industry, and his status in the internet world isn't as high as Tan Jincheng's.

Tan Jincheng and he were only acquainted with each other, but had never met.

However, Tan Jincheng knows another person, Wang Xin, the owner of Renren.com, who is considered a veteran in the internet industry. Wang Xin has a good relationship with Zhang Yiming, so he can ask Tan Jincheng to introduce him.

With the sale of Happy Farm, subsequent changes are needed regarding Kaixin.com's authorization of Renren.com and Dianping.com, which is a good opportunity to contact him for help.

In late October last year, Renren.com held a "Renren Connect Strategy Smart Launch Conference," announcing that it would achieve comprehensive connections with excellent websites in various vertical fields through Renren Connect technology. It claimed that through this technology, it could achieve comprehensive connections with vertical websites such as Tudou, Hudong Baike, Dianping, Douban, and Kaixin.com.

Prior to this, it also provided a function for sharing resources between its products inside and outside the site, similar to the one-click forwarding of later generations. In fact, this thing is not new. Kaixin.com had it from the very beginning of its development.

You recognize each character individually, but if you put them together, do you still not understand what you're saying?

Just don’t understand it.

In Tan Jincheng's view, this whole thing was simply determined by Renren's business. Renren is mostly used by students, and its potential seems huge, but its commercial value is limited.

Students these days don't have much spending power, not to mention their biggest competitor is QQ, a behemoth whose main user group is students and young people.

To realize greater commercial value, Renren.com needs to make adjustments to its business operations.

Wang Xin is still the same Wang Xin, always quick-witted. This trick of making money using other people's information is really clever. Whether it can actually work is another matter, but it's always good to create some hype.

You can't just connect like that; it depends on whether other vertical websites are willing. For example, Kaixin.com isn't very interested in this plan unless you can offer substantial benefits.

The same applies to other vertical websites, which is why their progress is relatively slow.

However, Wang Xin didn't care. His reason for hyping it up was simply to prepare public opinion for the IPO. As long as the capital market approved, that was enough.

Wang Xin and Zhang Yiming, both from the same hometown, come from equally well-off families. They have a good relationship with this young business owner and even started a business together before. Fanfou, which closed in July 2009, was founded by them.

Aside from his work experience, this is Zhang Yiming's fourth venture into 9rooms. Whether he lost money or not is unknown, but he has certainly gained a wealth of experience.

That's what normal entrepreneurship is all about: a process of trial and error until you find your own industry.

In his previous life, Tan Jincheng also started by selling boxed lunches. After separating from Zhang Xupeng, he tried many different industries.

The main reason why ordinary people fail to succeed in business is that they don't have many opportunities to try and fail.

If you occasionally find a small business opportunity and are lucky enough to make some money, you can live a peaceful and stable life without having to go through any trouble.

After hanging up with Cheng Hao, Tan Jincheng quickly contacted Wang Xin.

"I've already spoken with Wang Xin. You know him too, and his company happens to be in Beijing. Why don't you go to his company while you're there? There are still some issues with Happy Farm that need to be addressed."

Selling Happy Farm is not that simple. Currently, besides Renren.com, there are quite a few other websites that have authorized it, such as Dianping. Cheng Hao has a lot to deal with.

If it weren't for Cheng Hao, Tan Jincheng wouldn't have thought of Zhang Yiming for a while.

After hanging up the phone, Tan Jincheng began to ponder. The automotive industry is inseparable from the media, and the competition between car manufacturers is extremely fierce. The major setback of Dizi in 2010 was largely due to their poor relationship with the media.

Almost all domestic brands started by copying others. Chery QQ was even sued by Daewoo. Although it ended in a settlement, the lawsuit lasted for three whole years.

Everyone uses tricks and plays dirty tricks, but why is Dizi the only one with the worst reputation?
The root cause is still the poor relationship with the media. Weilai Auto must avoid this problem. Currently, Tan Jincheng owns vertical websites like Kaixin.com and shares in Bitauto.

In addition, they've been spending lavishly on various websites, and their relationships are currently quite good, but that's not enough.

News of spontaneous combustion of electric vehicles and brake failures in Teslas during the new energy vehicle era is quite common, making the competition between them much fiercer than that between gasoline-powered vehicles.

(End of this chapter)