Reborn since 1993

Chapter 1402 All crows are black
"How can this be?"

"How could America allow China.com to go public with such a high valuation?"

At this moment, Duan Yongji completely lost his composure and was no longer the composed person he used to be.

Wang Zhidong could tell that Duan Yongji had truly broken down at this moment. He had just felt that China.com's $28 billion valuation for its IPO was far too inflated.

But now, China.com is not only going to list on Nasdaq, but with an even higher valuation of $42 billion!
At this moment, Duan Yongji truly felt that he couldn't understand the internet, or even the current situation; everything was beyond his expectations.

With Duan Yongji's years of experience in the business world, he could see that China.com's listing at such a high valuation was simply a way to fleece investors.

He didn't believe that the Nasdaq Stock Exchange, the American Securities and Exchange Commission, or those institutions on Wall Street couldn't see it.

But ironically, China.com's IPO was approved against all odds, as if America was cooperating with China.com to prove them wrong!
At this moment, Duan Yongji felt that his worldview had been shaken. For a moment, he even felt that he was the only one who was sober in a world of drunks.

Duan Yongji's feeling was indeed correct. If we look back ten years from now, China.com's high valuation will be seen as a false prosperity, a product of a bubble period.

But that's for the future. Right now, the entire Wall Street community is absolutely thrilled that China.com is going public!

The entire Wall Street system is exploiting investors. Investment firms, pension funds, and big and small companies in America, as well as the bigwigs on Capitol Hill and other prominent figures, are practically treating the Nasdaq stock market like an ATM.

Simply invest in an internet company, list it on NASDAQ, and once the lock-up period is over, you can cash out the shares, resulting in a return of dozens of times your initial investment.

The key is that this isn't just one company playing this game; it's a tacit collaboration between the entire Wall Street and Capitol Hill officials. This is how this kind of game can continue to be played!

Even the President of America was probably one of the biggest driving forces. Without his approval and the indulgence of the Capitol Hill officials, would Wall Street institutions dare to play such a big game?
Can the American Securities and Exchange Commission (SEC) send internet companies to the stock market like dumplings being dropped into a pot? Doesn't the SEC see that those internet companies have problems?
You can question whether the people at the Securities and Exchange Commission have ulterior motives, but don't question their competence.

However, in this frenzy, different people have different demands, and Wall Street institutions, of course, want money.

What President America wants is power and votes. He is trying to win over Wall Street institutions and Silicon Valley to build up connections and resources for his family. In the future, Wall Street and Silicon Valley will be the foundation of his family's power base.

Therefore, China.com is also a powerful tool for Wall Street institutions to fleece retail investors. As long as they buy up the circulating shares issued by China.com and then drive up the stock price, how could they be afraid of losing money?

Yes, China.com's valuation of 42 billion is very expensive. But when China.com's market value is inflated to 84 billion, 10 billion, 20 billion, or even 30 or 40 billion US dollars, the value of the China.com shares they hold will increase more than tenfold. Then they will dump them on the retail investors. At that point, will they still think China.com is expensive?
Conversely, the more famous and well-known China.com is, the easier it is for its stock price to be manipulated, the more likely it is to attract retail investors, and the easier it is for Wall Street institutions to control the stock.

Duan Yongji wasn't unaware of the overt and covert methods of exploiting retail investors in the stock market, but in reality, he still had a biased view of America and his thinking was stuck in the past.

In Duan Yongji's memory, the American stock market was completely different from the Hong Kong stock market and the A-share market. It was a beacon, the most perfect market in the world. How could it be so unscrupulous as to fleece investors?
But the truth is, Wall Street institutions are using the internet as bait to fleece investors, and their sickles are practically smoking from the heat.

Just one question: Are there any cats in the world that don't steal fish?
In a previous life, around this time, after the dot-com bubble burst, Nasdaq and the NYSE, in order to give investors an explanation and demonstrate the impartiality of the American Securities and Exchange Commission, held their reckoning after the fact, and it was quite a spectacle.

From Enron to WorldCom, these American giants really don't treat ordinary people like human beings.

They're incredibly adept at falsifying financial statements, embezzling public funds, manipulating accounting records, and manipulating stock prices.

As for cases like AOL, which saw a one-time reduction of $990 billion in goodwill, it was a shocking blow to Wall Street.

When the tide recedes, these giant companies have already cashed out, obtaining enough US dollars that their families could never spend in several generations. They've put it all into trust funds, decided to give up entirely, and simply closed down and went bankrupt, leaving the retail investors with nothing.

At worst, the founder can spend a few years in federal prison, and once the storm passes, he can pay a huge bail and return to high society.

And Arthur Andersen, one of the Big Four accounting firms representing fairness and conscience on Wall Street, was also dragged down and eventually went bankrupt, essentially taking the blame for those American giants.

But Arthur Andersen wasn't the only one engaging in shady practices; it was merely used as a typical example, which doesn't mean that other accounting firms are truly innocent.

Compared to the audacious Enron and WorldCom, this only serves to highlight the "duty" of internet companies.

After all, internet companies can only manipulate click-through rates and page views at most; they don't do much else.

At that moment, Wang Zhidong felt that Duan Yongji had aged considerably in an instant.

For Duan Yongji, losing to Li was not shameful, but when he felt "abandoned" by this era, the mental defenses of the Duan sect leader finally collapsed.

Wang Zhidong wanted to speak again, but Duan Yongji waved his hand weakly, leaving Wang Zhidong no choice but to get up and walk outside.

As he closed the office door, Wang Zhidong couldn't help but sigh. When China.com went public with $42 billion, it meant that the battle for Chinese internet portals had come to an end.

From now on, only China.com will be different from other portal websites!
Wang Zhidong felt both unwilling and somewhat helpless. The thought of Sina having to compete with China.com in the future made him walk out with heavy steps, but he was actually numb.

...While Zhongguancun and the domestic internet industry were still fiercely discussing 3721, the news that China.com was going to go public came out of nowhere like a thunderclap.

Unlike 3721, Zhongguancun's first reaction this time was not to argue, but to be silenced for a while.

Zhongguancun is well aware that China.com has a high valuation and is now implicitly considered the face of the Chinese internet.

But damn it, that's $42 billion! That's almost 30 billion RMB! A lousy website has surpassed the market capitalization of a whole bunch of listed companies on the A-share market. There's absolutely no logic to it.

While there's still debate about 3721 on the mainland internet, there's practically no controversy about China.com.

The so-called four major Chinese internet portals—Sina, NetEase, and Sohu—are all silent at this moment. Even if they were all bundled together, they wouldn't be a match for China.com.

It's important to understand that with such a high valuation, everyone knows that if the stock price doesn't fall below the issue price, the subsequent rise will be quite terrifying!

The impact was also felt by many domestic internet companies, with 3721 and China.com successively pursuing IPOs, one listing on the Hong Kong Stock Exchange and the other on Nasdaq. This raises the question for domestic internet companies: which path to choose!

Inside the Cui Palace Hotel in Yanjing, there is one of the gathering places for the Zhongguancun community, where many internet companies are located, including 8848, currently the largest e-commerce company in China.

Now, 8848 is also facing controversy: "China.com is about to be listed on NASDAQ, which is an opportunity for 8848!"

Tan Zhi, who recently joined 8848 from Microsoft, excitedly declared, "8848 should launch a new round of financing and begin its quest for a Nasdaq listing!"

There is absolutely no dispute about which is the largest e-commerce platform in China right now. Even Alibaba's Jack Ma probably wouldn't deny it. It's 8848, and it's the representative of e-commerce in China.

Upon hearing Tan Zhi's words, Mao Yiding, known as the top operator in Zhongguancun and parachuted from Lianbang Software to 8848 as the marketing director, immediately turned his gaze towards Lao Rong, namely Wang Juntao, the founder and chairman of 8848.

After joining 8848, Tan Zhi has always wanted to "internationalize" 8848, which means introducing overseas venture capital and then listing on Nasdaq.

But his most important goal was to change 8848's strategic direction and transform it from a B2C business to a B2B business.

B2B refers to Alibaba's platform, B2C includes Tmall and JD.com, and C2C includes Taobao, eBay, Xianyu, Zhuanzhuan, and of course, Pinduoduo...

In the past, the boundaries between various e-commerce platforms were becoming increasingly blurred, and there were no strict boundaries. After all, in the end, it was found that things like grocery shopping, group buying, errand running, and food delivery could not be added to them.
However, even in the e-commerce industry today, there are still different factions, and everyone is sticking to their own way of doing things.

The idea behind placing 8848 is that Wang Juntao insisted on 8848 focusing on B2C, essentially turning it into a website like Tmall or JD.com, while Tan Zhi wanted 8848 to transform itself.

This has created an undercurrent of turmoil within 8848. What appears to be a problem of 8848's transformation is actually a question of whether the faction led by Tan Zhi will take control, or whether Wang Juntao will remain at the helm of 8848.

In addition, the Federal Software faction, represented by Mao Yiding, is the parent company of 8848 and is therefore qualified to form its own faction.

This led to Tan Zhi, Wang Juntao, and Mao Yiding forming the three major factions within 8848.

"Foreign investment institutions may not understand the domestic internet industry. 8848 should raise funds, but I think it should raise funds from the Zhixing Foundation and the Gangcheng Future Industry Foundation. It's not too late to list in Gangcheng first and then try to go public on Nasdaq!"

Wang Juntao spoke up, saying that he actually knew that Tan Zhi was very close to venture capital firms such as IDG Ventures and SoftBank, and that these overseas investment institutions were quite interested in 8848.

But once IDG invests in 8848, who will ultimately have the final say?

Upon hearing Wang Juntao's words, Tan Zhi's smile vanished instantly; the disagreement between the two was becoming increasingly serious.

Seeing this, Mao Yiding acted as a peacemaker, saying, "Everyone is concerned about 8848. I think IDG and the Hong Kong Future Industry Foundation can get in touch!"

In the end, Wang Juntao and Tan Zhi parted on bad terms. Seeing this, Mao Yiding exchanged a glance with another executive of 8848, both of them looking helpless. If things continued like this, they felt that 8848 might start to have internal strife even before it went public.

Regardless of which venture capital firm 8848 ultimately chooses, domestic internet companies like 8848 are now starting to consider Zhixing Foundation and Gangcheng Future Industry Fund as options when selecting venture capital firms, rather than blindly flocking to foreign investment institutions.

In cases like 8848, Wang Juntao unconsciously began to regard the Gangcheng Future Industry Foundation as "one of his own" who were aligned with domestic internet companies.

Wang Juntao had a premonition that if Gangcheng Future Industry Fund invested in 8848, he wouldn't be ousted. However, if overseas venture capital firms like IDG invested, it was uncertain whether he could retain his position as chairman...

Being selected as a candidate, or even the first choice, for venture capital firms investing in domestic internet companies is already enough for Gangcheng Future Industry Foundation!

……

In the back garden of a villa on the hillside in Gangcheng, wisps of smoke rose from the barbecue. Li Dashan, the philanthropist, personally grilled a few pieces of meat. The bigwigs of Dongke Gangcheng Company also brought their families to the event. Today was a gathering of Dongling High-Tech in Gangcheng.

(End of this chapter)