Starting out as a drug dealer in 1988

"Mr. Zhao, this is Mr. Doug, President of Goldman Sachs Asia."

"Welcome, Mr. Doug, I am honored to have you visit Hengyuan Electronics!"

"Mr. Zhao, you're welcome. Hengyuan Electronics is becoming increasingly powerful in the mainland market. We at Goldman Sachs have always been very interested in your company!"

"Everyone, please take a seat. Lu Han, please help me get out my good tea. I want to entertain our distinguished guests!"

……

A week later, Song Weixuan arrived as promised.

The difference is that this time he not only came in person, but also brought Mr. Doug, President of Goldman Sachs Asia.

If Hengyuan Electronics had not attracted Goldman Sachs's attention in the past, now Hengyuan Electronics, with its large-scale store layout and the upcoming development of the TV market, has finally earned the right to be taken seriously by them.

As of May 46 this year, Hengyuan Electronics' revenue had reached billion yuan.

And this year, it's only been four months.

According to previous estimates, Hengyuan Electronics' revenue this year will definitely exceed 140 billion yuan.

But don't forget that Hengyuan Electronics will begin expanding its TV business in July, which will undoubtedly significantly boost the company's overall revenue.

Therefore, the company has made a preliminary calculation that in 1996, Hengyuan Electronics' overall revenue will definitely exceed 160 billion, or even more.

"Mr. Zhao, I need to clarify something with you. I have resigned from Goldman Sachs and have taken over most of the business of Meifeng Group. Therefore, I am here to represent Meifeng Group."

After both parties sat down, Song Weixuan stated his position first.

"Oh? I see." Zhao Wenhao was a little surprised, but not too surprised.

Obviously, Song Weixuan joined Goldman Sachs because his family wanted him to join in the interest of gaining experience.

After all, as the future successor of Meifeng Group, we are quite dedicated in training him.

Now, after several years, it was impossible for Song Weixuan to continue working as a senior executive at Goldman Sachs. Hence, the introduction just now came about.

Doug's arrival naturally also means that he hopes the previous cooperation can continue.

"Mr. Zhao, I think your company should be able to proceed with its second round of financing. Asian finance is experiencing unprecedented prosperity right now. If your company wants to go public, it's best to expedite the process."

Doug didn't exchange too many pleasantries and went straight to the point of his visit today.

In fact, everyone knows it tacitly.

According to normal procedures, Hengyuan Electronics should have completed its second round of financing as early as the end of last year.

But Zhao Wenhao is waiting for the further expansion of the store chain, and the TV business is ready to go online.

As a result, Hengyuan Electronics' valuation will inevitably increase significantly compared to the end of last year.

In fact, this is exactly the case, which can be seen from the revenue.

"Mr. Doug's words hit the nail on the head. I'm meeting with you all because I hope to complete the second round of financing as soon as possible and begin preparations for going public."

Zhao Wenhao didn't take it lightly and replied without thinking.

We have already cooperated before, and the other party is a shareholder of Hengyuan Electronics, each holding a 5% stake.

Therefore, they are quite clear about the current situation of Hengyuan Electronics.

Doug and Song Weixuan were indeed extremely surprised by Zhao Wenhao's sudden and straightforward answer.

They originally thought that Zhao Wenhao would definitely set up certain obstacles for them in order to gain more bargaining chips.

But what was unexpected was that Zhao Wenhao agreed immediately.

This made them feel a little unreal.

"So, how many shares does Mr. Zhao plan to sell this time?" Doug asked tentatively.

Zhao Wenhao didn't think too much about it and said directly: "20%. This is also the largest share that Hengyuan Electronics can offer."

Doug and Song Weixuan looked at each other and their brows lit up with joy.

20% is already a very high share.

Adding this to the previous 10% stake, the two companies now control 30% of Hengyuan Electronics' shares.

"Gentlemen, I need to clarify that this 20% stake is all I can offer. However, last week, Citibank, Sequoia Capital, and other investment firms made appointments with me to meet this week for detailed discussions.

Therefore, I cannot guarantee who will ultimately receive this 20% stake. It all depends on your skills and the leverage you can offer."

Zhao Wenhao smiled slightly and poured a basin of cold water over him.

Sure enough, Doug and Song Weixuan were both visibly stunned. They knew there would be competition, but seeing so many investment companies flocking to the West still caught them off guard.

They both thought they were very quick, but they didn't expect that the others were also quick.

Looking at the two men's expressions, Zhao Wenhao coughed deliberately. "Don't worry, you two. We had an agreement before. Under the same conditions, you two will have priority. I haven't forgotten this."

Doug and Song Weixuan felt a little helpless, as they certainly knew they had this right.

But with so many competitors, if someone deliberately raises the price, won’t they have to keep following suit?

If someone really offers a high price, wouldn’t the profits they can obtain in the future be significantly discounted?

"Mr. Zhao, I've reviewed your company's financial statements for last year and the first four months of this year. We at Goldman Sachs have conducted an analysis and estimate that your company's revenue this year will reach 160 billion yuan.

However, we have also analyzed your company's input and output this year. We are somewhat concerned that your company's net profit this year will not be very high."

Doug starts playing his cards.

"Necessary investment is the only way for the company to develop. Since the second half of last year, our company has been expanding its store chain nationwide. We currently have more than 300 directly-operated stores.

Taking these investments into account will inevitably lower the company's profit ratio. There is no doubt about this.

But you only see the profit margin, but don’t carefully study the input-output ratio.

I have some data here, you two can take a look at it.

In first- and second-tier cities, the funds required to open each store chain, including rent, personnel, publicity and other expenses, are about 100 million yuan.

However, almost all stores have monthly sales of more than 60 or even more.

Even if we calculate based on a 15% net profit margin, we can recover all our initial investment in less than a year."

Zhao Wenhao asked Lu Han to hand over a report that he had prepared long ago.

Doug and Song Weixuan's expressions froze as they took the report and began to read it carefully.

Only core members of Hengyuan Electronics were qualified to see such data reports. Therefore, the two of them were naturally unaware of this.