Reinventing the Millennium

Regarding Yike Technology’s Series A financing, this was Fang Zhuo’s first priority after arriving in New York.

Market development takes time, and litigation and counter-litigation require processes. Therefore, the A-round financing, which was contacted a few years ago and returned to China to find new investors, became an urgent matter to be finalized.

IDG America, IDG China, and Xiangjiang Huanyu, these three institutions will become the main investors of the Series A financing. Capital Today and Shenxin Technology, which have successively invested in Angel Round and PreA, will also make a small amount of follow-up investment.

At the same time, taking into account the health of the equity structure, this round of financing will also set up an option pool to reward executive talents.

Originally, Fang Zhuo did not plan to set up an option pool in the A round, but he only decided to join a Xiangjiang venture capital. Even though Xiong Xiaoge repeatedly guaranteed the independence of IDG China, he was still willing to let the valuation of his shares be reduced in disguise. IDG's shareholding ratio was also weakened.

The option pool is set up for the most reasonable reasons, but it has additional uses here.

Before Fang Zhuo went abroad, he had notified Xiong Xiaoge and Huanyu Liang Qihua that their schedule was scheduled for three days later. As for Capital Today and Shenxin Science and Technology, they said they only needed to attend the meeting by phone. After all, they didn’t have much money to pay. Everyone joins in the fun.

In order to confirm that the arrangement was correct, Fang Zhuo made a courtesy call to Miller of IDG America to remind him of the agreed time for financing negotiations.

However, before the people from China arrived in New York, Miller personally visited Fang Zhuo in the afternoon after the phone call to discuss his investment intentions.

I don't know if it was an illusion, but Fang Zhuo felt that this time Miller, who was backed by IDG, was still reserved, but there seemed to be more enthusiasm behind it.

He thought about it while communicating, and felt that it didn't seem to be a change caused by performance, so he simply took it for granted and asked the other party before they were leaving.

"Mr. Miller, I feel like you are more optimistic about Yike than before. Why?"

Miller did not hide his reasons: "RIAA is suing Yike, and SESAC is said to be sending you a lawyer's letter. I think companies including Sony Music may also initiate lawsuits against Yike."

Fang Zhuo frowned slightly, this sounded like a price reduction before the A round.

"Just like Apple, which has received many infringement lawsuits, the more people want to sue Yike, the more it shows that Yike's growth is very threatened." Miller laughed, "How could IDG miss this kind of growth? Fang, the old music forces are already trying to prevent the arrival of the new era."

Fang Zhuo got goosebumps.

He didn't know if he had this tone when he encouraged others, but hearing this guy say this was really... not very touching.

The young president just nodded and said: "Yes, this is good for Yike."

Miller nodded with deep understanding, shook hands and said goodbye: "I am very pleased to see the release of iMusic. This is exactly the scene value you mentioned for the first time. It will form a closed loop of hardware and software and create a new industry ecology.”

Fang Zhuo shook hands with the IDG executive with a smile, oh no, this is not called a handshake, this is called venture capital institutions empowering entrepreneurs, and everyone will reach a closed loop with far-reaching impact on capital flow.

When the door of the conference room was pushed open, Miller left Yike with his assistants. Yu Hong, Kong Yu and others who were waiting for this closed-door negotiation gathered around him.

"Mr. Fang, how was the discussion?" Yu Hong asked with concern.

Fang Zhuo refined the central idea: "IDG mainly expresses one idea. The more lawsuits Yike files, the more excited they will be."

Kong Yu, who returned to New York early after the Spring Festival, has been helping Yu Hong recently. All he is doing is related to Yike. He was the first to react: "Will IDG America actively participate in the A round? Will they invest? "

"It should be. Miller and I had a very pleasant chat." Fang Zhuo nodded, "In this case, it will be easier to convince Xiangjiang Huanyu."

Liang Qihua of Xiangjiang Huanyu was quite optimistic about Yike when they first contacted him in Beijing. However, there was a twist in the process. When they were investigating Yike's situation in the United States, they learned that the RIAA had filed an infringement lawsuit, which made them retreat.

Just like an employee of Yike in the United States who was so frightened that he resigned after hearing about the lawsuit, Xiangjiang Huanyu also found it difficult to accept it, fearing that his investment would be in vain - after all, Huanyu also discovered Mr. Fang's record during a background check Somewhat astonishing.

Therefore, under the condition that Miller's attitude is relatively positive, the main task of the financing talks is to allow Xiangjiang Huanyu to spend money smoothly, and to allow Shenxin Science and Technology and Capital Today to spend as much money as possible. As for Xiong Xiaoge, he is an ally who is firmly optimistic about Yike .

In the next three days, Fang Zhuo did nothing else but organize materials and pick up people at the international airport twice.

He rented a business car in a serious manner, and after just a brief exchange of greetings, he presented information. He first practiced with Xiong Xiaoge, and then prepared to communicate with Liang Qihua.

Xiong Xiaoge was quite puzzled when he didn't react at first. He waited until he got closer to the hotel and finally realized the taste: "I know a lot of what you said along the way, and this and that, let's just leave this training. ?Prepare for the meeting?”

"What can we do at the meeting? We have to communicate in advance, especially with Mr. Xiong." Fang Zhuo just smiled, "Well, if I pick up Liang Qihua tomorrow, I have to dispel his concerns first."

Xiong Xiaoge suddenly understood and nodded sarcastically: "I understand, I understand, you must not be merciful."

Fang Zhuo said seriously: "I have seen so many venture capital investors, raised so much money, and been criticized so many times. My heart has become as cold as my knife."

He also sighed: "The development history of an enterprise is simply the history of financing. It is not easy to ask for money from this company or that company. It is not easy for you to be optimistic today and to be optimistic tomorrow."

It was even more difficult for Xiong Xiaoge to nod: "So, you recruit people from the partners and let people who are familiar with Party A and Party B come to help, right?"

He turned his head and glanced at his former subordinate Pan Ben, who had been silent and did not show his presence.

Pan Ben showed a weak and friendly smile. He felt that he really shouldn't come with his former boss on this trip. He was on pins and needles along the way.

"Let's not talk about the past. Looking forward, we will need Mr. Xiong's help in the talks the day after tomorrow." Fang Zhuo always needs to be sincere and sincere when raising money.

Xiong Xiaoge casually mentioned that his trip was not only to raise funds, but also to see what Yike's situation was like in the United States.

After discussing with Mr. Xiong of IDG, Fang Zhuo was very comfortable in contact with Liang Qihua the next day.

The sun is shining brightly and the wind is gentle.

When Fang Zhuo came to the international airport to pick him up, he almost heard the magpies chirping.

"Mr. Liang, Mr. Liang, hello, hello. I'm really glad to see you in the overseas market."

"Here, let me introduce you. This is Yu Hong, our marketing director at Yike, and this is Pan Ben, the vice president of our planning department."

Liang Qihua saw this battle when he got off the plane. He was flattered but at the same time he was alert in his heart and shook hands with each other after greetings.

Today, two business cars came for pick-up. In the first car were the three senior executives of Yike, Liang Qihua and another deputy director of Huanyu. In the second car were young assistants from Huanyu.

"Mr. Liang, I won't say more to be polite. First, let Mr. Yu introduce to you the progress of our overseas work."

Fang Zhuo smiled and handed over the materials in his hand. They were to be used in the meeting and should be reviewed first.

As a company that came to the United States from China, from November last year to the end of March this year, Yike launched two hardware products M1 and P1 overseas, released a software product iMusic, and opened up the second largest chain store in the United States, Super Crow. In order to provide high-quality channels, we are about to discuss cooperation with Wal-Mart, the largest supermarket.

However, Liang Qihua saw in the materials that Yike did not introduce much about Kroger and Wal-Mart, but instead spent a lot of space explaining the channel sinking of the product.

"Mr. Fang, this channel is sinking..."

Fang Zhuo nodded and said: "Mr. Liang, first of all, our competitor in the United States, Apple, although it does not support Microsoft, must change it. By then, the advantage of our products is the price, and the channel is sinking. The best way to demonstrate the price advantage.”

"Apple's sales channels are mainly concentrated in big cities. Once it turns around and supports Microsoft, we will have to compete head-on. Considering this, channel sinking means staggering the battlefield. The United States is different from our country. The cities below also have quite strong sales channels. Spending power."

"Whether it's Internet infrastructure or fixed music terminals in towns and cities, these can allow Yike to quickly distribute products."

"In order to distribute products, Yike will transfer most of its profits and must blow up the number of users like a balloon. This is different from the domestic situation."

Liang Qihua frowned and said: "Selling most of the profits? Then what? What happens after the number of users increases?"

"The more users we have, the more leverage we have with SESAC, Sony Music and other companies. Just like the start screen of our iMusic, the accumulated users are like the yang side. With music licensing, the yang side can be combined with the yin side to become one Complete Tai Chi, you can make paid music downloads, and you can open up the prospects of hardware and software." Fang Zhuo is very serious.

Liang Qihua didn't know the U.S. market well enough. He asked: "Can music companies do such licensing? Wouldn't this undermine their other businesses?"

"No company can ignore the booming number of users. All users who buy music players are the most accurate customer group in music." Fang Zhuo said rationally, "The development of MP3 format music is already showing its power. Music companies will weigh the pros and cons."

He continued: "The problem at this stage is only how to distribute the interests between us and the music company. This is a difficult point, but the licensing itself is not."

"So, we have to rush to accumulate users in front of Apple to convince music companies. This accumulation process will not only make most of the profits, but also burn money."

Liang Qihua felt quite refreshed by what he heard.

Looking at the current Internet companies, not to mention mainland China and Hong Kong, but also the United States and Europe, whether it is the strategy of sinking channels or the goal of encircling the number of users, it seems that no one has done this, but it sounds logical. Self-consistent.

The car is quiet, with only slight engine and tire noise.

Liang Qihua thought for a long time and felt that he could not be easily persuaded like this.

He coughed and wanted to speak.

Fang Zhuo was the first to speak, and said calmly and confidently: "A new business model is unfolding before our eyes. IDG America has confirmed that it will actively participate in Series A financing. If Mr. Liang, you are still hesitant now, you can see it tomorrow It’s up to everyone’s judgment.”

He smiled: "Liang can always study these materials with your team. We won't talk about it just after we get off the plane. You must be tired all the way here."

President Yike, who had been talking all the way, changed the topic directly, and Liang Qihua's unnecessary words were kept in his heart.

Yu Hong, who had previously introduced the market situation, and Pan Ben, who had been watching all the time, both felt that the boss's speaking rhythm was excellent, especially Pan Ben. He felt as if rumors had become reality. Is this a venture capital hunter?

However, Pan Ben soon saw the true style of the hunter.

IDG China and Xiangjiang Huanyu arrived in New York, Domestic Today Capital and Shenxin Technology confirmed the time, and Yike’s Series A financing talks were held without any twists and turns.

This meeting was different from what some people imagined. It almost turned into a speech by Fang Zhuo on the business model.

Pan Ben, who had been following Fang Zhuo to New York since Shanghai, really heard the young president's ambitious design about Yi Ke.

Integration of software and hardware is something Fang Zhuo has said long ago.

Channel expansion is what Fang Zhuo has been doing.

Music licensing is a related relationship that Fang Zhuo considers.

None of these are new, but when they are put together and talked about coherently, they seem to have a lot of charm all of a sudden.

Pan Ben never understood what a closed loop is, or in other words, he always understood it in a literal sense. When what he saw and did was outlined in the president's confident statement, he was really impressed by the goals of iMusic digital music media. Hit.

This is exactly the reason he and Xiong Xiaoge said. Being in a company gives you a sense of excitement and participation in changing the industry, rather than being watched by venture capital investors.

"The significance of iMusic is not only the moat for our M1 series products, but also the new music media camp that we are persistently building."

"Whether it's hardware profits or software music downloads, this is a vibrant sunrise industry. It can be said that due to Apple's stubbornness, we are already at the forefront of the world."

"Of course, Yike also faces many problems. What we can do is to solve every problem in front of us, whether it is RIAA's lawsuit or changes in competitors."

"You see, this is Yike's planning node. Product upgrades, channel integration, business marketing, copyright negotiations... Yike is walking on the most correct path."

"What we are doing is to develop new business models, to serve more user groups, and to lead the development of Internet music."

“I don’t think there should be much discussion at today’s meeting about channel sinking and cost reduction.”

"Because what we want to talk about is not business technology, but business art."

Fang Zhuo had a firm expression and a clear voice. He looked around at the executives representing different organizations in the conference room and smiled: "Of course, those questions are not unimportant. If you have any doubts, you can ask them and I can still answer them."

People from two IDGs, Oneworld Hong Kong and two domestic institutions attended the meeting.

Xiong Xiaoge nodded like a dog: "I have no problem. I think we can move on to the next step, the discussion about investment and shares."

Wang Fengyi, who was using the phone to attend the meeting, heard this and said twice in Chinese and English: "I second the motion."

Miller from IDG America spoke third: "Very good, Fang's speech is very good. What we are discussing is the art of business. We will develop a new business model, which is excellent."

Xu Xin from Capital Today also approved the progress of the link via phone.

Liang Qihua of Xiangjiang Huanyu hesitated for two seconds. He felt like he was attending a lecture today, but regardless of Xiong Xiaoge or Miller, the questions interspersed between them had already been answered by President Fang.

The team's material research yesterday and the speech at today's meeting mixed the two information into one conclusion in my mind.

"Well, it's no problem in Huanyu."

Fang Zhuo drank his first drink of water since today's meeting began. Well, this is substantial progress in Yike's internal strength, not bad.