Return to 1958 and build a century-old giant

Chapter 842 Investment Plan for Mainland Universities
He Guoyuan replied: "If it's just about making some traditional home appliances, the suppliers in the mainland are still okay. They can also produce some home appliances themselves, although their foundation is a bit weak."
However, when it comes to integrated circuits, it's completely out of the question. Even many high-ranking executives at large companies in Beijing don't know what integrated circuits are, yet they're still focused on manufacturing transistors. This is why China's electrical appliance exports are so poor; they're practically nonexistent and can't keep up with the times.

"Yes, that's right. Even radios are starting to use small integrated circuits now," Yang Wendong nodded and said.

In the 60s, when Glory Electronics was first established, its initial business was not electrical appliances, but the production of transistors. At that time, electrical appliances, from small radios to large color TVs, all required transistors.

More than a decade later, with the iterative development in Silicon Valley and the existence of Moore's Law, integrated circuits have become mainstream, and their costs have continued to decrease, gradually replacing transistors. Only some simple electronic products with very low value still use transistors, such as electronic watches, but in the future, they may also be replaced by small integrated circuits.

He Guoyuan said, "I have also suggested to some heads of state-owned enterprises in the mainland that they should try to transform, but most of them did not listen to me because there is still a market for transistors in the mainland."

"Haha, the entire electronics industry in mainland China is still using transistors. It's going to be very difficult for them to transform." Yang Wendong chuckled, then asked, "You said the majority, so there's a small portion that's willing to switch?"

He Guoyuan nodded and said, "Yes, some of them understand the international situation, but to transform, they first need money. As you know, the management of state-owned enterprises in China is uniformly managed by the government, not by them. Moreover, this requires the introduction of overseas equipment and foreign exchange, which makes it even more difficult."

“It’s true that state-owned enterprises in China are managed by the government, but they can apply for many things themselves.” Yang Wendong thought for a moment and said, “How about this, you contact a few of them and see if they can form a joint venture with us. We’ll handle the foreign exchange. We’ll invest in their companies and then introduce integrated circuit equipment and technology. Let’s see if they can develop.”

He Guoyuan said, "Okay, then I'll give it a try. According to mainland law, even if it's a joint venture, our authority is very limited. Zhou Sheng's previous investments in Very Cola and instant noodles were very messy in terms of authority."

The electronics industry is certainly more strategically important than the food industry, so even if we invest, we'd likely struggle to gain sufficient management control; it would require lengthy negotiations.

“I know about that matter too, but it’s different from yours.” Yang Wendong shook his head and said, “They have specific projects and goals over there, but you don’t.”
My original intention with this investment was not to participate in its management. I only needed to monitor the finances. We invested in several domestic companies, and then they developed on their own. As long as a few of them succeeded, we would have a sufficient return.

In fact, in terms of pure technology management, the group itself is not very strong. The reason why Honor Electronics has been able to develop well is mainly due to its large number of game copyrights, which makes its scale comparable to companies like Sony. However, it still cannot compare in terms of technology reserves, management experience, and the number of talents. This is not only a limitation of Yang Wendong, but also a limitation of the city of Hong Kong.

This broad-based investment in China is essentially like raising a cult, to see if one or two cult leaders can emerge. These companies are selected from those interested in developing integrated circuits, and their management teams are relatively ambitious. If one succeeds, not only will the company benefit economically, but Honor will also have more options for suppliers in the future.

Even if you're really unlucky and none of them succeed, you won't lose money. This is because state-owned enterprises in this era are mostly located in the city center, or even concentrated in Beijing, Shanghai, and Guangzhou. Even if the factories fail in the future, the land beneath them will still be a huge profit.

Of course, there are plenty of opportunities in the mainland real estate market. His investment purpose was to nurture the market, and if he couldn't nurture it, he would still hope that real estate could provide returns from other aspects.

"Is this similar to venture capital in Silicon Valley?" He Guoyuan realized.

Yang Wendong laughed and said, "Yes, more or less. Many of my future investments in the mainland will be venture capital in nature. If an Apple-like company emerges, I'll make a fortune."

As for the mainland brands he knows in the future, he can naturally make accurate investments, just like Nike, Walmart, and Intel in the United States.
For many non-civilian industries where we are not very familiar with them, we can adopt the Silicon Valley model: invest in a wide net. This way, we can catch a few big fish, and even if we lose money on the others, we will still make a profit. Besides, through the real estate market, we can eventually make a profit on the others that we lose money on.

He Guoyuan nodded and said, "I understand. I will then prepare to make contact with the mainland side."

“Okay, let’s prioritize big cities, where there are more talented people.” Yang Wendong thought for a moment and said, “Speaking of talent, we also need to make full use of the mainland’s resources. If your team finds capable people, you can also train them in the mainland or bring them to Hong Kong. Our company is short of talent.”

Hong Kong is, after all, a city, and with real estate and finance being more profitable, there is an extreme shortage of talent in the manufacturing sector. This is normal. If Yang Wendong had traveled back to the 80s, even if he were to work in manufacturing, he would go to the mainland and focus on finance and real estate in Hong Kong.

For large technology companies, the most important thing is talent. Many of Yang Wendong's good ideas need talent to realize them; otherwise, even the best ideas are useless.

Previously, the production of the Famicom was technically inadequate, so Wozniak was brought in to solve the problems. However, in the long run, this approach was not feasible. The fact that the company's own computers could not be made well was also largely due to a lack of talent.
After all, the competitors are top companies in Silicon Valley, where there is an abundance of talent, making the gap hundreds or even thousands of times larger; while Japan, even if it can't compare to Silicon Valley, is still much stronger than Hong Kong.

He Guoyuan said, "With such a large population base in the mainland, there must be talented people. It's just that they have been closed off for so long that even intelligent people probably don't understand modern technology."

“This is a problem; they're out of touch with the times.” Yang Wendong frowned slightly.

In fact, modern people are not smarter than ancient people, or even more intelligent than primitive people. They just have been exposed to systematic education from a young age and know more.

No matter how smart people are on the mainland, it's all for naught if they haven't been exposed to modern electronic technology.

He Guoyuan said, "How about I find some smart students first, send them to university in Hong Kong, and then have them join our company after graduation? But doing that would be too time-consuming."

“This is indeed a method. Although it cannot solve the immediate problem, it is beneficial for the future. However, not to mention that the cost is not low, there are not many positions for studying electronics in Hong Kong universities, and the University of Hong Kong is not short of people.” Yang Wendong shook his head and said.

In fact, he had persuaded the Governor of Hong Kong to increase the number of students in university disciplines related to the electronics industry in his early years, but after all, Hong Kong only had two universities, so how many students could there be?
Another point is that it faces the same problem as the United States in the future: good science geniuses are poached by banks and financial institutions. They also need such people. Although Chang Hing Group is a large and powerful company, it cannot compare with all the real estate and financial companies in Hong Kong combined.

He Guoyuan said, "Then there is no solution."

“No, not exactly.” Yang Wendong thought for a moment and said, “Actually, there is another way: to build a university in China specifically for learning Western electronic technology.” “Mr. Yang, you’re planning to build a university in the mainland?” He Guoyuan was initially surprised, but then thought it made sense.

The super-rich in Europe and America also frequently donate huge sums of money to schools, and a few even invest in building schools themselves;

With Yang Wendong's current financial resources, building a university is no problem. In mainland China, labor costs are low enough that the cost would be much, much less than in Europe and America.

“I have this idea, and the sooner the better,” Yang Wendong nodded and said.

The construction of the university town also takes years, and the training of the first batch of people will also take several years. So the earlier the better. If it is fast, the first batch of talents may appear around 85. If it is a few years later, it will really have to wait until the 90s, which is a huge loss for the time-sensitive electronics industry.

Investing in schools, even though it's a donation, can yield substantial returns.

On the one hand, donating a university would definitely be a historic achievement, as it would be the first university in the country to be donated by Hong Kong capital after the reform and opening up.

Secondly, the current investment will surely yield returns in the future. Historically, both Li Ka-shing and Pao Yu-kong donated a university in mainland China.

The former also reaped substantial returns in other areas after the 90s, ten or even a hundred times the investment of the university. The latter should have actually received similar returns, but after Bao Yugang's death, the Wu family, his heirs, made a foolish mistake and squandered the enormous network of connections left by Bao Yugang.
Thirdly, I need to build a global electronics group or even an automotive group in the future. This foundation must be built in the mainland. Hong Kong is not an option. Such a large company also needs a top university nearby to continuously attract high-quality talent and fresh blood.

Any technologically advanced country will inevitably have top-tier universities, and the same applies to cities. For a technology industry to take root, the city must have a corresponding top-tier university.

He Guoyuan asked, "Which city are you planning to stay in?"

“I haven’t decided yet, let’s wait a bit longer. You should inform Xinhua News Agency about this and have them spread the news to the mainland.” Yang Wendong said, “These kinds of things won’t be approved in less than a few months. After approval, there will be many details to negotiate, just like with previous investments. We’ll decide which city to choose then.”

Actually, what he really hopes for is Shenhai City, which is close to Hong Kong and can become a top-tier city in the future.
But right now, the Deep Sea Zone has only been established for a year and is not yet a special economic zone. Its economic development is also just average. If I propose it now, the mainland will definitely not agree. They will definitely demand that it be located in Beijing, Shanghai or Guangzhou, or at the very least, in a provincial capital city.
If you propose donating to a university now, and then get approval from the mainland, which will take a few months, just in time for Shenzhen to become a special economic zone in August, you can then propose settling in Shenzhen. That way, there will be much less resistance.

“Okay, I’ll go and inform President Zhang right away,” He Guoyuan said happily.

In fact, during his year at Honor, he also felt a great shortage of talent. Some of the plans he devised always lacked the corresponding talent to implement them.

While there is a well-established talent development program, Honor Electronics is developing too fast. Its gaming industry is growing exponentially, and other home appliance industries are not much slower. After all, the boss is becoming more and more successful in the overseas retail terminal industry, which is driving the explosive development of Hong Kong's local electronics industry.

At this time, Hong Kong, a region with a population of several million, experienced a shortage of talent.

Over the years, the group has spent a lot of money poaching talent from Europe, America, Japan and Taiwan to barely meet its needs, but this is not a long-term solution.
Building a university in China would be a good option, although the initial investment would be substantial. However, the constant recruitment of talent from overseas over the years has been a slow and gradual process, costing a considerable amount of money in the long run.

That afternoon, He Guoyuan summoned several trusted confidants to discuss the matter, and then arranged for people to go overseas to investigate the requirements that Western tycoons would make when donating to schools, as well as some subsequent experiences and summaries.

He would not inform the mainland side rashly before he was fully prepared;
A week later, after some materials were prepared, He Guoyuan arrived at the Xinhua News Agency and met with its director, Zhang Guangdou.

"What? Mr. Yang is going to donate a university in China?" Zhang Guangdou was shocked when he heard this news.
A university? It would cost a lot of money to build that. The country knows its education is inadequate, but it doesn't have the money. Every region needs foreign exchange.
Moreover, even within the education sector, there is considerable controversy over how to spend money, as primary, secondary, high school, and university all require funding, and each is important.

While universities can certainly cultivate top talents, for a country to achieve comprehensive development, it also needs to cultivate literacy among all citizens and eliminate illiteracy. In that case, primary schools may be even more important.

The domestic education authorities are arguing fiercely over these issues, and the national leadership is having a headache over them. In reality, there is no right or wrong; everyone is doing it for the country. The core problem is the lack of funds. If there were money, all kinds of schools would be built.

He Guoyuan corrected, "It is a modern university, just like Western universities, with a lot of modern equipment. However, our group also has its own requirements, which is to focus on cultivating talents in electronic technology or mathematics. Moreover, these people will be given priority to be recruited by our group after graduation, rather than being assigned to the mainland."

No matter how much money Honor Electronics has, it's impossible for them to spend money to establish a liberal arts university, and any science university they establish must prioritize their own students.

Upon hearing this condition, Zhang Guangdou was immediately troubled: "Mr. He, university students in China are very valuable. They are usually assigned by the national education authorities. Your request may cause quite a bit of controversy."

"So, that's the premise, otherwise our group wouldn't have done this," He Guoyuan said with a smile. "Conversely, if we hadn't built the university, you wouldn't have these university students. Now that we have an extra university, and the students are working for our group, it's not a loss for your country's Ministry of Education, is it?"

“That makes sense. What other requirements do you have? Please tell me all at once, and I will organize the information and submit it.” Zhang Guangdou said.

PS: Please give me a monthly ticket
(End of this chapter)