What's wrong with me being a rich man?

Chapter 279 Bottom Line (5k)

The mountain peak appeared.

This time it is still accompanied by - deception of eternity.

Following China Forest Holdings, it once again raised questions about the two companies. Surprisingly, this time in addition to the China Company, there was also an American company that was not listed but was highly favored by Wall Street.

As a short seller who has been very active and has a distinguished record in the past two years, as soon as Guo Shanfeng revealed the abnormal data of a listed company, major financial media reprinted the relevant news and launched detailed research on the target.

China High Speed ​​Channel.

An advertising company that was listed on the OTCBB through a backdoor listing and just transferred to the Nasdaq in June this year.

And this isn't the first time it's been questioned this year.

As early as August, the US short-selling agency Citron had already begun to doubt it, which at one point caused the stock price to fall from US$8 to US$12.

However, China High Speed ​​Channel quickly fought back and held an investor conference at the Shangri-La Hotel in Mindu, inviting representatives from CCTV Investigation Company and the bus company to testify to the existence of the company's business and operating entities.

In the end, Citron's doubts came to nothing.

More than three months later, Guo Shanfeng set his sights on it, and this time the doubts were more specific about business comparisons and data issues.

Guo Shanfeng made a financial comparison with companies in the industry.

华夏高速频道宣布自己有5.5万块左右的广告屏幕，公布的Q2营收是5300万美元，而业内另一家拥有12万块屏幕的华视传媒在Q2只拿到3100万美元。

At the same time, China Media Group’s screens are located in high-value areas in major cities such as Beijing. According to market conditions, they should have higher unit revenue than bus advertisements covering second- and third-tier markets.

The gross profit margin announced by China High Speed ​​Channel is as high as 73%, which is not only much higher than the industry average, but even higher than the leading Fenzhong Media, which only achieved a Q67 gross profit margin of 2% through its business model and economies of scale.

The contradiction revealed by data such as revenue, gross profit margin, and operating scale is difficult to explain.

In addition, Guo Shanfeng provided testimony from the front line, and obtained the sales quotation sheet of Huaxia Expressway Channel by pretending to be a customer, which clearly stated that the company's advertising network had 1.25 vehicles available.

However, the figure in the financial statements of Huaxia Expressway Channel is 2.72 vehicles, which is 2.176 times the actual number.

In addition to the data, Guoshanfeng also showed inquiries to Huaxia High-Speed ​​Channel's partners. It claimed to cooperate with 13 vehicle operators, but when inquired by phone, only half of them admitted it, and the number of vehicles they actually operated was far less than the number claimed by Huaxia High-Speed ​​Channel.

At the end of this questioning, Guo Shanfeng took the opportunity to ask Deloitte, one of the world's four largest accounting firms, and asked it to be responsible for the relevant audits. It was because of Deloitte's positive opinion on the financial report that China High Speed ​​Channel was able to successfully transfer to Nasdaq.

Different from Citron's last move, this time it questioned China High Speed ​​Channel's specific business, financial reports, and industry standards from all aspects.

Similarly, unlike Citron, Guoshanfeng is a successful short seller so far.

About 80% of the research report issued by Guo Shanfeng this time questioned the China High Speed ​​Channel, and the remaining 20% ​​was left to Theranos, a blood testing company founded by "Female Steve Jobs" Holmes. The company claimed to be able to subvert traditional blood tests. It only needs to collect one or two drops of blood from the finger to detect a series of diseases from cholesterol to cancer, and the price is only one-tenth of the traditional price.

Guo Shanfeng did not talk about Holmes's imitation of Jobs' words and deeds. What he provided to the outside world were several anonymous statements marked as company employees, claiming that the company can now only perform a dozen blood tests using its own equipment, and the remaining tests use cracked versions of Siemens instruments.

Also, the unanimous understanding among employees about founder Holmes is that she has a religious-like belief in the innovation of blood testing, but her knowledge base in science and medicine is quite weak.

At the end of this research report, medical experts in the industry were quoted as saying that they do not believe that current science and technology can achieve the innovation of detecting various diseases with just a few drops of blood.

Guo Shanfeng gave his own evaluation of this project: This is another bubble that looks perfect, but it is no different from the myths we have dismantled in the past. After peeling off the layers of packaging, there is only blasphemy against science and mockery of investors.

One is a Chinese listed company with a current market value of US$6 million, and the other is a star startup project that is highly regarded by Wall Street.

Without waiting for the parties involved to respond or for regulators to launch an investigation, many media outlets have already made judgments about both parties, stating that China High Speed ​​Channel and Theranos must have committed fraud!
Why are you so sure...

The data seems reasonable. The former has front-line sales figures, which are obviously inconsistent with the financial report, and the latter has revelations from internal employees. Since they are brought out, they will not be aimless.

The most important thing is that the market value of China High Speed ​​Channel is only 6 million US dollars!
Look at the targets that people have attacked before. All of them were worth billions of dollars. Even the last time, China Forest Holdings had more than one billion dollars. Now look at these two...

One has only $6 million, and the other has not yet been listed.

Is it necessary to lie for such a small thing?

As "Deception Is Forever" spread again, the trust tone of Chinese and foreign media was similar, and some foreign media even called Deloitte directly, hoping to get an explanation from this well-known auditing agency and asking it to respond to Shanfeng's questions.

However, Deloitte remained silent and was unwilling to respond to relevant questions.

This attitude of not even providing the most basic support was interpreted by the media as, "Deloitte probably knows what they have done" or "Deloitte may believe in Guo Shanfeng more than Guo Shanfeng himself."

Audits have fallen silent, regulators have not taken any action, but the secondary market is voting violently with its feet.

Just the day after Guo Shanfeng appeared, the stock price of China High Speed ​​Channel was halved, and its market value evaporated by US$3 million, which became another footnote to the value of Guo Shanfeng.

At the same time, because of this influence, many media have called "Guo Shanfeng" a "well-known short seller."

The title that Penguin gave to this operation over the mountain is - Fatal attack by a well-known short seller.

Yu Xing saw this report from Penguin and found the content quite positive.

Domestic media mainly reported and paid attention to the Hua Xia High Speed ​​Channel that was exposed this time, while a considerable number of foreign media were more interested in Holmes, the "dropout, subversive, entrepreneurial goddess, female Steve Jobs, and the next Bill Gates."

Many Wall Street media have reported on her company and projects before, and many bigwigs have endorsed her, but this time she encountered a peak...

Holmes's reaction was faster than that of China High Speed ​​Channel. She accepted a telephone interview with the media and claimed that "the research conducted by Guoshanfeng was untrue, one-sided and irresponsible", but at the same time, she also admitted that "scientific and technological innovation requires time and tolerance."

The news about this person will probably continue to struggle in public opinion for a while.

However, she was just an add-on to Guoshanfeng's current round of actions, something she did out of the blue and would not generate any benefit. No matter how she tried to explain herself later, Guoshanfeng would not pay any attention to her.

On December 12, just as WeChat was about to launch a new round of financing, Yu Xing received a call from Zhang Suyang after get off work.

As usual, Zhang Suyang praised the recent work of WeChat Company, talked about the expansion of the user group's positioning, and finally mentioned the revenue issue with some hesitation.

"Mr. Yu, WeChat's revenue is a long-term goal. This will indeed create competitive pressure for the company, and the mood of institutions is relatively low right now..."

Yu Xing was mentally prepared when he answered the call. Hearing this, he said, "Mr. Zhang, you can be frank. No matter what new decision IDG makes, I can understand it. Of course, I still believe that the equity of WeChat has value."

"Today Capital's exit, well, this is mixed with Mr. Xu's emotions. Frankly speaking, Mr. Yu was able to fill the gap with traffic from different companies, which exceeded my expectations." Zhang Suyang was more straightforward, "Qiming Venture Capital is now unwilling to follow this round because the development of WeChat Company is becoming more and more risky."

The user scale of WeChat was close to the target agreed in the last round of financing, but the withdrawal of Capital Today and Qiming Venture Partners has changed things a lot.

Yu Xing said: "Mr. Zhang, if it is simply because of the vacancy left by Qiming Venture Partners, Red Falcon Capital will fill it."

Zhang Suyang didn't expect Hongshun to be so determined, and swallowed back what he wanted to say. Yu Xing waited for a few seconds, but didn't hear anything from the other side, so he continued, "Hongshun got $1000 million from Capital Today before, which is enough to make up for the withdrawal of Qiming Venture Partners."

Zhang Suyang couldn't help but laugh when he heard about the source of funds: "Boss Xu also left a gift."

He sighed, and after a moment's silence, he said, "Well, Mr. Xiong will contact you later."

Yu Xing felt a little depressed. This didn't sound like a good word.

He stopped his plan to drive to Xiaoying's place, bought a pack of cigarettes, and walked around the community while smoking, thinking about the gap that would be left after IDG also withdrew.

According to initial estimates, this was a round of financing of approximately US$3600 million, and the traffic value obtained last month was calculated to be US$1700 million. On paper, it is slightly more than the US$1200 million from Today Capital, but due to the premium factor, it is actually not much more.

Qiming Venture Partners' exit was made up by Red Falcon, and behind it was Guo Shanfeng's surprise fundraising for China High Speed ​​Channel. If IDG also withdraws, even if Guo Shanfeng still has a "Journey World" that also has fraudulent transfer and numerous loopholes, it will be difficult to follow up because it still needs to maintain a short position on Penguin.

WeChat company is already doing its best, and Guo Shanfeng’s chips are almost exhausted.

Yu Xing smoked slowly. It was about to rain. At this point, if IDG also withdrew, there was no way to stop it. Guo Shanfeng could only adjust the portfolio as much as possible. Unfortunately, in addition to the losses of its own, the fraudulent companies with higher certainty would not be able to fully realize their profitability, which was also a huge loss.

If you can wait until this round of fighting with the Penguin is over and have more capital in your hands, then you can get the greatest profit by continuing to short sell.

Similarly, if shorting Penguin fails, leaving behind "Journey World" will also provide a bargaining chip for a comeback.

Yu Xing frowned and smoked while waiting for the call.

At 7:30 in the evening, a call came in from Xiong Xiaoge.

"Mr. Yu, what do you mean?" Xiong Xiaoge asked as soon as he came up.

Yu Xing was stunned: "Boss Xiong, I'm waiting for your decision."

"It's a bit difficult." Xiong Xiaoge said quickly, "Can we still fight? Is there still hope?"

Yu Xing is a person who likes to communicate directly. Hearing the other party's attitude at this moment, he gave a cautious answer: "Hope is shrinking. Penguin's determination and resources are greater than initially imagined, but WeChat is still worth investing in."

"From the current situation, WeChat should have developed quietly at the beginning, but this is all hindsight. Without seeing the actual response from Penguin, we could not have accurately predicted it. This time, both Pony and Penguin responded and adjusted very quickly." Xiong Xiaoge said bluntly, "The withdrawal of Capital Today and Qiming Venture Partners both agree with the judgment of the mainstream opinion. WeChat has no chance."

Yu Xing was turning his thoughts.

Xiong Xiaoge did not stop and continued: "I have considered a disposal method before, which is to reverse inject into the listed company, but this attempt is basically hopeless. The main reason is the value recognition of WeChat. However, I talked to Robin from Baidu last week and talked to him about the development of mobile Internet."

Yu Xing was surprised and asked, "Did he talk to Li Yanhong? I also went to Baidu last month, but I didn't see him. Baidu is also unwilling to invest in WeChat traffic."

"Yes, we invested in Baidu in the early years, so we can still talk." Xiong Xiaoge briefly mentioned their past relationship. "He basically agrees with my judgment on the importance of mobile Internet, and also agrees that WeChat is a rare threat to Penguin. So, now there is good news and bad news. Which one do you want to hear first?"

Yu Xing pondered for three seconds and said, "Good news."

"The good news is that Baidu recognizes the value of WeChat. The bad news is that Baidu strongly recognizes the value of WeChat, so if it wants it, it will want it all." Xiong Xiaoge made things clear.

Yu Xing pondered: "You want all of them? Does that mean Baidu wants to acquire them?"

"Robin's original words were, since WeChat is very important to us at Baidu, if we want to buy it, we should just buy it all," Xiong Xiaoge explained. "He is not willing to invest, but is willing to buy it at a good price when WeChat needs to be sold in the end."

Yu Xing understood what he meant: "Baidu is willing to acquire it at a discount."

"Robin thinks it's dangerous to compete with Penguin for instant messaging. You should also be able to feel Pony's reputation. No matter how people talk about Penguin, Penguin's current business achievements are there. So, when Pony came out to emphasize the competition with WeChat, WeChat's external financing cooled down." Xiong Xiaoge added, "Also, although Baidu is unwilling to invest in WeChat, it recognizes you. If you are willing to go to Baidu, you will still be one of the persons in charge of WeChat business."

Yu Xing didn't know whether to laugh or cry: "Baidu still wants me?"

"Pony has his reputation." Xiong Xiaoge laughed, "You have the reputation to fight against him. If you go out and look around, you will get a lot of traffic. Everyone has seen how WeChat has grown from nothing to what it is today."

Yu Xing sighed: "Really?"

Xiong Xiaoge said more seriously: "Yes, by the way, I have a message for you in advance. The Internet Summit Forum will be held in Pengcheng in March next year. You will also be one of the guests. Um, the founder of the third largest instant messaging company in China."

He didn't hear the voice on the phone, and smiled again: "You see, it is more or less prestigious, right? You were a listener last year, when Tang Jun was involved."

Yu Xing had almost forgotten about this matter, but upon hearing this, it was true. Last year he was an audience member at the summit forum, but next year he was invited to be a guest.

He didn't feel much comfort, but just said, "I don't want to go to Baidu."

"I guess you don't want to go either. I just tell you that WeChat company does still have value. We can ask Baidu to make the final disposal. If you are not reconciled to the competition in this area at that time, you can change your mind and go to Baidu." Xiong Xiaoge said.

Yu Xing said with certainty: "I won't go to Baidu."

"If WeChat fails completely..." Xiong Xiaoge paused, "I know you still have Bai Xiaosheng, but Bai Xiaosheng must go through the listing process this year. We can't wait any longer."

Yu Xing asked: "Why?"

"Recently, Guo Shanfeng, who has been eyeing Chinese concept stocks, has successfully shorted a domestic company again, which has affected the reputation of Chinese concept stocks. In addition, there is a dispute between China and the United States over cross-border audits, and both sides want to discuss audit working papers. This is not a good sign." Xiong Xiaoge said seriously, "If it is not listed soon, it may encounter very complex system problems later, which may be difficult."

Yu Xing was surprised and sighed: "Ah? Why is it so bad to cross the mountain?"

"The embarrassing thing is that the targets we found all had problems." Xiong Xiaoge didn't want to talk about the short seller any more, and finally said, "IDG will still invest this time, and Baidu's support should be fine, but because of the changes in the current situation, WeChat's valuation will be reduced by 20%. Mr. Yu, this may be our last support."

Yu Xing only said: "Boss Xiong, thank you very much."

"Starting a business is never smooth sailing. It's rare that WeChat has come this far," Xiong Xiaoge consoled him. "Up to now, WeChat is still lagging behind. If WeChat can continue to expand its user base, it may not be a loss to sell it to Baidu in the end."

Yu Xing then asked, "Boss Xiong, can you talk to Ali?"

Xiong Xiaoge laughed and said, "Do you think I didn't look for him? Ma Dian is not interested in this. He is busy with Yahoo's affairs. He is also responsible for this round of problems of Chinese concept stocks. Alipay has caused overseas distrust of the VIE structure."

"Well, Mr. Xiong..." Yu Xing thought, "I can operate it."

Xiong Xiaoge agreed, "WeChat is already operating very well. Mr. Yu, don't feel too much pressure. WeChat's value will not go away. I will talk to Capital Today and Qiming Venture Partners again. Penguin wants to buy it, but I don't think it will pay a high price. It's better to sell it to Baidu."

Yu Xing sighed, "Okay, Mr. Xiong, I won't go to Baidu. WeChat can still operate. At least it can empty the magazine and increase its value accordingly."

The magazine was empty, and the situation completely changed from long to short, forcing the Penguin into a protracted competition.

WeChat doesn’t have payment, but Alipay is another level of competitor.

The penguin wants to end the battle quickly, so give its strategy a small shake.

(End of this chapter)