Rebirth 2010: I taught Mr. Lei how to make a mobile phone

Chapter 921 Boiling Ants

The following day, several foreign media outlets suddenly launched an attack, exaggerating that the goal of producing 5000 Model 3s per week had become a pipe dream, and even questioning whether its production data was fabricated.

The report repeatedly emphasized Tesla's "cash burn" rate of over $6500 per minute, predicting that if it cannot achieve positive cash flow, it will inevitably launch a new round of emergency financing, leading to a significant dilution of its equity.

Under the barrage of negative media coverage, Tesla's stock price fluctuated wildly and declined, with a single-day drop of over 12%, setting a record for double-digit declines.

In the following days, the stock price continued to fall below key support levels, triggering algorithmic trading sell orders and panic selling by retail investors, forming a vicious cycle of "falling-selling-further falling".

The already pressured stock price was hit by a massive short-selling attack, resulting in a precipitous drop.

The sharp drop in stock price and the collapse of market confidence have completely blocked Tesla's path to financing through issuing new shares.

Musk responded fiercely on Twitter, even using profanity to denounce short-selling institutions as "robbers and bandits," but this move was interpreted as a sign of desperation, further exacerbating the stock price decline.

In just one week, Tesla's market value evaporated by about $83 billion, plummeting from $500 billion to just over $400 billion, with one-sixth of its market value vanishing.

Domestic and international media outlets have been reporting extensively on Tesla's massive losses, production delays, and stock price collapse, portraying it as a typical "high-risk, unstable" company.

Seeing that the time was ripe, Chen Mo, carrying the "Strategic Plan for the Development of China's Independent Intelligent Electric Vehicle Industry," led a delegation of more than ten people from local emerging forces to relevant departments to discuss cooperation on building a factory.

However, the negotiations between the two sides stalled and progressed slowly over the following week.

Even though Chen Mo proposed that the traditional model of "exchanging market for technology" is outdated and we should shift to a new paradigm of "cultivating technology through market"—leaving core market resources to "local forces" that are deeply tied to China, rather than overseas giants that may create a technology black hole and cause profits to flow out.

Some even questioned whether the data security risks associated with Tesla's Autopilot system could jeopardize national information security.
The other party, however, kept dodging the issue, responding with generic phrases like "let's study it further," "let's discuss it further," and "we need to communicate with other departments."

The attitude wasn't exactly impolite, but Chen Mo vaguely sensed the other party's perfunctory attitude and arrogance. He knew that no one in the capital would dare to treat him like that.

Ultimately, both parties ostensibly agreed to "discuss further later," but the meeting ended on bad terms.

However, the negotiations were not entirely fruitless: although Tesla did not budge on the land plots for cooperation, Chen Mo still managed to secure more generous local subsidies, loans, and land resources for "Wei Xiaoli" as consolation.

Although this effort did not achieve all its goals, it allowed Chen Mo to build positive relationships and accumulate a deep network of connections in the field of new energy vehicles.

The newly established industry alliance can also form an innovative cooperation model: the other side provides intelligent technology (AI, autonomous driving, intelligent cockpit) and funds, traditional car companies provide manufacturing capabilities and supply chains, and battery companies are responsible for the three-electric technologies.

Chen Mo views the development of "Wei Xiaoli" as a "breeding" exploration—maintaining healthy competition through collaboration and accumulating the first batch of car manufacturing experience for Chinese new energy vehicle companies.

In the future, whether it's the other side or Xiaomi that enters the car manufacturing industry, it will become a valuable asset, allowing us to learn from 'WeiXiaoLi' and cross the river!
Back at the headquarters in the capital, Chen Mo reported the situation to the "Tianji Pavilion".

The analysis report was quickly submitted, pointing out that "if a matter is not lacking in people or money, but is not progressing smoothly, there are often other reasons behind it."

The report's conclusions largely coincided with Chen Mo's guesses:
"There are factions everywhere. Even small companies bear the imprint of their region. For example, although Biyuan has a branch in Shanghai, it is still a Beijing company."

This experience made Chen Mo fully realize what 'xenophobia' truly means!
No wonder after a week of communication, I felt like I was an outsider in Tesla's eyes.
Thinking about how some of the city's future actions would indeed be quite "magical," he felt relieved, as it aligned with his consistent perception of the city.

This incident actually caused Chen Mo's attitude toward 'whether or not to manufacture cars' to change somewhat, as he had previously leaned towards not manufacturing cars.

"Why not just get involved ourselves, build cars, crush Tesla, and slap some people in the face while we're at it?"

"No, no, you absolutely can't get involved. It's safer and more profitable to stay in the background and sell shovels. Have you forgotten how you started out? This is your original profession!"

"By the time Xiaomi starts making cars, it'll be too late. Lei Jun is consolidating his empire. With you around, it's uncertain whether they'll even make cars this time."

"Personally getting involved, just think about what Lei Jun has experienced since he started making cars. Apart from his white hair, everything else about him is black from head to toe—all mudslinging from competitors. Isn't that upsetting enough?"

Two voices argued endlessly in his mind, evenly matched.
Entering May, Chen Mo had no time to dwell on the car manufacturing controversy anymore—news came that Ant Group's pre-IPO round of financing was in its final stages and would be officially announced soon.

What's coming will eventually happen, and a tough battle is inevitable.

Generally speaking, a company seeking to go public will go through multiple rounds of financing, from angel rounds to A, B, C, and D rounds. Depending on the specific circumstances, there may be even more financing rounds involved.

But once it reaches the pre-IPO stage, the listing process becomes the most crucial step.

The overall process involves pre-IPO preparation, initiation and execution, review and inquiry, and once these are completed, the final issuance and listing can take place.

In terms of timeline, pre-IPO preparation requires a significant amount of effort in internal organization and team building. This stage is a period of self-reflection and preparation for the company, forming the foundation for a successful listing. Generally, it takes 6 to 12 months. Chen Mo looked at the timeline of Ant Financial's last Series D financing, which was a full 18 months ago. This unusual timing, coupled with Jack Ma's recent low-key behavior, made him feel that Ant Financial might be quietly accomplishing something big.

It's important to understand that the key aspects of the PI (Pre-IPO) preparation stage are introducing strategic investors and conducting Pre-IPO round financing.

The purpose is to replenish capital, optimize shareholder background, and introduce well-known institutions to boost market confidence and ultimately increase the company's valuation.

If the story is told well enough that enough people believe it, a high valuation can have a positive impact on the market value after listing.

However, this is a double-edged sword. Financing usually comes with performance-based agreements (such as performance commitments and listing time commitments), and if the listing fails, it may trigger repurchase clauses.

It seems that Lao Ma and his team are well-prepared this time.

Chen Mo retrieved the "Ma Yijinfu" plan from the core internal system of the other shore, which was synchronized with the latest progress in real time.

Submitting a warning plan has clearly become ineffective, or at least temporarily ineffective.

However, other plans are proceeding in an orderly manner.

For example, there are alliances and strategic maneuvers among allies. After all, Ant Financial's IPO will inevitably lead to a situation where one company dominates the market. Whether they are on the other side of the strait or other companies such as Tencent, Baidu, and JD.com, they all have financial businesses and share a common interest in "containing Ant Financial," which is a situation that no one wants to see.

Therefore, by utilizing the resources of various platforms and putting in a little effort, you can achieve very good results.

For example, in Baidu search results for keywords such as "Ant Financial IPO" and "Is Huabei safe?", the ranking weight of articles with related questions can be slightly adjusted.

Of course, all the materials on the other side of the strait have already been prepared.

Then the online public opinion battlefield was divided into two parts, advancing at the 'elite' and 'mass' levels.

There are also missions being launched offline as part of a full-scale attack.

This plan has been in preparation for over six months since its inception, much like a financial war, with the other side meticulously preparing for it, treating it as a crucial battle.
The list of investors behind Ant Group is also available, but it's an older version. After more than a year of iterations, the other party will definitely have a much larger lineup.

So now is not the time to act prematurely.
Chen Mo wanted to see what kind of shady characters were in the opposing camp before making a move.

How many surprises, or rather astonishments, will Lao Ma bring him after holding back for more than a year?

He was looking forward to it.
Meanwhile, at Alibaba's headquarters in Hangzhou, a thousand kilometers away, a tense atmosphere was already brewing, as if a storm was brewing.

Back in April 2016, Ant Group completed its Series B financing round, with an overall valuation of approximately US$60 billion and a financing amount of US$45 billion. Major investors included China Investment Corporation Overseas, CCB Trust, CDB Capital, and China Post Capital.

This round of financing solidified Ant Group's unicorn status and introduced state-owned capital.

In June 2017, just one year and two months later, Ant Group completed its Series C funding round. This time, the scale was even larger, with its valuation soaring three times to $180 billion and the funding amount reaching $16 billion.

This time, the investors are mostly top global institutions (GIC, Temasek, Warburg Pincus, CPPIB, etc.) and existing shareholders, making it the world's largest unicorn and paving the way for international IPOs and subsequent international IPOs.

This last-minute financing before the IPO has fueled the imaginations of countless investors and Ant Group employees.

Most Ant Group employees generally believe that their company is the 'center of the universe' this year and the absolute leader in fintech.

The company's business growth rate, technological strength, and market position are impeccable. The only drawback is that WeChat Pay remains a challenge.

This IPO campaign is seen as a natural and decisive milestone, a chance to reap the glory and rewards it deserves.

Ant Group's stock options/RSUs (Restricted Stock Units) are the hardest "hard currency" on the market.

Almost all employees, especially the long-term employees, were silently calculating their net worth after the company went public.

In the break room, cafeteria, and at workstations, "financial freedom," "where to buy a house," "what car to get," and "when to travel to Europe" have become popular topics, half-joking and half-serious.

Unlike the employees who have achieved financial freedom, the focus of discussion among Ant Group's senior management is more on "where to list" (A+H shares?) and "what the valuation is" (2000 billion? 3000 billion USD? 5000 billion USD?), rather than "whether it can be listed."

Because almost no one doubts that Ant Group cannot go public, given its past record of having a star-studded and impressive portfolio of investments.

(End of this chapter)