Rebirth Tokyo 1986

Chapter 230 It's Hard to Return
There are two main ways for foreign capital to initiate venture capital investments in emerging American companies.

One is to spend a huge amount of money that far exceeds common sense.

For example, in his previous life, SoftBank’s Masayoshi Son initially took this route.

After learning about Yahoo's basic situation, he invested an exaggerated $1 million.

At the time, Yahoo had nothing and didn't look like it would become a giant.

1 million US dollars, completely beyond the imagination of venture capital.

But Masayoshi Son's use of his billions to attract people has indeed had a very good effect, and he has since established a firm foothold in the Silicon Valley venture capital industry.

Because most startups cannot refuse SoftBank's huge amount of real money.

The other path is the route that Xinghai Investment is preparing to take.

Acquire more than 10% of the shares of a well-known company as a proof of trust in new enterprises.

For example, Masato Takeshita wants to invest in a company.

We can say that we are the major shareholder of a certain company.

Xinghai Investment's selected demonstration targets are Cisco and Microsoft.

On the one hand, these two companies are well-known enough, and on the other hand, they are developing fast enough, so the display effect will be better.

Xinghai Investment has been absorbing Microsoft's shares.

He has now become the third largest shareholder of Microsoft after Bill Gates and Paul Allen.

Unfortunately, there are limited Microsoft shares on the market.

Even if Xinghai Investment made a large purchase, it could only acquire 14.32%.

There is no way around it, Bill Gates alone owns 45% of Microsoft's shares.

In addition, Paul Allen and many Microsoft employees, big and small, also own a large number of shares.

There are very few Microsoft shares floating in the market.

It took a lot of effort for Xinghai Investment to buy 14.32%.

Not only did it purchase through the market, it also purchased at a premium through investment banks such as Goldman Sachs, spending approximately US$7.6 million.

Compared with Microsoft's current market value, Xinghai Investment lost approximately $1 million on this investment.

Even so, it's still worth it.

Because of this investment, it will more than double in value next year.

Once Windows 3.0 is released, Microsoft will transform from a follower to a leader in the operating system field.

The company's market value will also change from just surpassing Apple to being far ahead of Apple.

“President, are we really going to fully enter the U.S. stock market?”

Jia Benlong is a little confused now.

He would prefer the company to keep most of the funds and then buy at the bottom after the Japanese stock market plummets.

He didn't have the slightest idea that the Japanese stock market would never recover from this.

Kamoto Takashi simply thought that the stock market was just a technical adjustment and that given the strength of Japanese companies, they would soon return to their peak.

“It’s not about going all-in, the main purpose is to not leave funds idle.”

“When I think the Japanese stock market has fallen enough, I will come back.”

Masato Takeshita did not reveal the secret in his heart, and answered with nine truths and one lie.

He will indeed return to Japanese stocks, but only with a small amount of funds.

And this part of funds will only be used to buy stocks of giants in the electronics field and companies that are beneficial to the development of Xinghai Group.

For example, Sony, a company that reached the top in 2000, and Shin-Etsu Chemical, a giant in the upstream semiconductor materials market.

No matter how badly other companies fall, he won't even look at them.

Mainly because the ongoing bubble era has severely damaged the normal growth of Japanese companies.

Many companies are not investing as much in emerging technologies as they did in 1985.

What’s even worse is that after the bubble bursts, major companies will become more conservative.

In the 90s, Japan was surpassed by South Korea and Taiwan in the semiconductor field, which was due to a serious lack of investment in science and technology.

If Masato Takeshita chooses to return to Japanese stocks on a large scale, he will be using his own money to help others get out of trouble.

He is not so selfless, and he doesn't want to waste his hard-earned money foolishly.

"Hey, I see."

Yoshimasa Yoshimoto was very happy because he always believed that a good company must be based in the domestic market.

This is true even for private equity hedge funds.

Then he asked carefully: "President, how long do you think this stock market crash will last?"

Masato Takeshita did not give a direct answer, but raised his voice slightly and asked back: "Do you think the Japanese stock market bubble is big?"

"Big, big."

Yoshimoto Takashi was thinking about the Japanese stock data collected by the company, which was simply shocking.

The price-to-earnings ratios of many companies are in the dozens or even hundreds, which is not healthy at all.

If the stock market crashes across the board, stock prices may be cut in half and then cut in half again.

Such a painful price will definitely cast a shadow on the hearts of stock traders.

Even if each company develops very well in the future, it will be difficult for its stock price to rise in a short period of time.

"Then do you think that after the stock prices of various companies return to normal, there will still be so many shareholders?"

"No."

After the stock market enters a bear market, even if there are continuous good news in the market, it will take time for investors to forget the scars.

And even so, countless shareholders will be lost.

Most of these stock investors have lost their principal or have a small amount of debt.

Realizing that he couldn't make money in the stock market, he took the initiative to leave this sad place.

A few are heavily in debt and leave this world completely in despair.

"The bubble is too big this time, and the Bank of Japan is still raising interest rates at a high intensity, trying to actively burst the bubble."

"In the next three to five years, Japanese stocks will not see much improvement."

“This is also the biggest reason why I am anxious to sell a large amount of Matsumoto Manufacturing shares.”

Matsumoto created this wealth, and Masato Takeshita also planned to go the US and Hong Kong stock routes first.

Yes, in addition to US stocks, Masato Takeshita also wants to invest in Hong Kong stocks.

Affected by the international environment, Hong Kong stocks are at a historical low.

The average price-to-earnings ratio of the stock market is only about 6.7 times.

If you enter the Hong Kong stock market now, even if you simply buy the index, you can quickly become rich.

In addition, if the US and Hong Kong stocks cannot fully absorb this money, he is also prepared to invest in the Korean stock market.

The 90s was a period of rapid expansion for several major Korean conglomerates.

Samsung, Hyundai, SK and other conglomerates have achieved growth of more than 5 times.

Although it is not as amazing as the American technology giants, it still has an astonishing growth rate compared to traditional companies.

The growth of Japan's electronics giants during the bubble era was no more than this.

"Three to five years? Oh, the Japanese stock market will be difficult in the future."

Kamoto Takashi nodded in frustration, having to acknowledge his own president's judgment.

Once the stock market collapses, it will be difficult for it to recover in a short period of time.

In the past, the Bank of Japan and the Japanese government delayed the rescue operation because of this characteristic of the stock market.

It was not until 1993 that the government realized the stock market was still stagnant and hastily introduced various rescue policies.

Unfortunately, it was too late.

The government’s infrastructure investment is basically a waste and does not stimulate the economy at all.

In fact, the Japanese government would like to invest more in high-tech industries, but it is really afraid to do so.

With the sword of Damocles of the Bald Eagle government hanging over its head, Japan dares not take any action at all.

Because once action is taken, the United States will punish Japanese companies under the pretext of administrative manipulation by the Japanese government.

Like Huawei in later generations, but not as strict.

There is precedent for this kind of thing.

The recent Tron operating system is the most typical example. The government was very supportive at the beginning and directly promoted the development of the Tron operating system through administrative means.

We plan to popularize computers in elementary and middle schools throughout Japan and establish computer rooms that use the Tron operating system.

But under strong pressure from the United States, the promotion was abandoned in June.

There was no way around it, as the United States was the largest market for Japanese electronic products at that time.

If Japan wants to develop, it cannot do without the United States.

As the two chatted, they felt more and more that Japan's future was worrying, and they fell into an unnatural silence.

After a long while, Kamoto Takamasa finally reorganized his words and changed the topic.

"President, are we going to fully align ourselves with Goldman Sachs in the future?"

The young man shook his finger.

"of course not."

"Xinghai Investment cannot get too close to any major American investment bank. I don't want to be blocked by Morgan Stanley."

Goldman Sachs currently has a lot of hatred with Morgan Stanley.

Because every time Morgan Stanley launches a hostile takeover, Goldman Sachs plays the role of the white knight.

Although Morgan Stanley has more abundant capital, its success rate in hostile takeovers is very high.

But in the end, many projects were ruined by Goldman Sachs and failed to earn more commissions.

Not only did he make less money, but his reputation also became worse in comparison with Goldman Sachs.

Of course Morgan Stanley couldn't tolerate this.

Unfortunately, Goldman Sachs is backed by the Rockefeller family.

Even though Morgan Stanley is much stronger, it is helpless against it.

But Goldman Sachs can't do it, but the fact that companies work closely with Goldman Sachs doesn't mean they can't do it.

The young man doesn't want to be the fish caught in the fire.

"Understood. Do we need to take the initiative to contact Damo?"

"No need. Damo will soon smell the scent and follow us."

The two companies have spies for each other, so don't try to hide it from each other.

Especially for Goldman Sachs, because of its partnership system, it is more difficult to hide secrets from Morgan Stanley.

Of course, outside the United States, Goldman Sachs' confidentiality capabilities are still very strong.

A representative event was helping Greece falsify financial statements to join the euro zone.

Unlike the European Union, the conditions for joining the eurozone are more stringent, and the government's debt level cannot exceed 60%.

Greece was totally unfit for that at the time.

Then, Goldman Sachs came along.

Through a series of operations by Goldman Sachs, the Greek government's debt was successfully concealed, and then it successfully became a member of the euro zone in the early 21st century.

Goldman Sachs chose to do this, on the one hand to make money, and on the other hand to implant a Trojan horse into the European Union.

Later, this Trojan horse was successfully detonated, causing great damage to the European Union.

"Hi!"

The next day, Goldman Sachs did not return to China directly like Morgan Stanley.

Paulson once again found Masato Takeshita and prepared to communicate further about the cooperation.

However, Paulson had not yet returned to the United States to convince the Goldman Sachs leadership or the investors, so the two men talked about things that were relatively vague and mainly focused on building relationships.

Masato Takeshita couldn't stand this kind of simple chat, so he smiled and changed the subject.

"I heard that there were a lot of conflicts between the two founders of Cisco and the board of directors."

"I hope that when the relationship breaks down, Goldman Sachs can help buy the couple's shares."

“Half of the shares are held by Xinghai Investment, and the other half are held by a joint fund with Goldman Sachs.”

The founder of Cisco was not good at management, so he handed over management to a venture capital company early on.

But these two technical founders like to interfere in the company's operations, resulting in Cisco's current mess.

Cisco's board of directors has limited patience and will soon purge the two.

This may seem callous, but it did help Cisco grow.

Thanks to this transformation, Cisco’s market value exceeded 5000 billion at its peak.

Paulson's eyes narrowed after hearing this, then he raised his eyebrows and asked, "Oh, Chairman Takeshita is optimistic about Cisco's development?"

The young man said frankly: "Yes, with the development of the computer industry, Cisco will also develop better and better."

“I don’t know when we will achieve growth, but I will definitely not lose money.”

Cisco's development momentum could not be concealed from Wall Street, so Masato Takeshita naturally would not choose to hide it.

As for whether Goldman Sachs will intercept it?
Basically impossible.

Because potential is just potential, who knows how long it will take to realize it.

Neither Wall Street nor Silicon Valley could have imagined the speed at which computers would develop.

Apart from Masato Takeshita, even the most daring investors in the world could not have imagined that computers would flourish all over the world in just over a decade.

"No problem. Once there is a change in Cisco, I will help you acquire this part of the shares as soon as possible."

Although Paulson didn't know why the young man was so confident, the Cisco founding couple would sell their stocks after leaving the company, but this was just a harmless matter.

What he values more is demonstrating Goldman Sachs' energy and completing the first cooperative project between the two parties.

"Well, it's a pleasure to work with you."

After returning to the United States, Paulson immediately inquired about Cisco's situation.

He looked at the report sent by his subordinates and couldn't help frowning and asked, "Is it so bad?"

"Yes, there is a serious internal conflict in Cisco right now."

"Santi Lerner had a very bad temper and made it very difficult for the entire company to tolerate him."

Sandy Lerner is the wife of the Cisco founders.

Her tough and stubborn character is the main reason for Cisco's management chaos.

"It seems that it will be difficult for Cisco to achieve anything in the short term."

After determining that Cisco had little future, Paulson quickly gave up the idea of following suit and buying some shares.

He didn't want to wait years.

As a senior partner of Goldman Sachs, he has countless ways to make more money in a short period of time.

"Always keep an eye on the situation of Cisco's board of directors and report to me immediately if there are any changes."

"Okay, sir."

Cisco was temporarily unable to proceed, and Paulson quickly turned his focus to a senior partner meeting three days later.

He wants to persuade everyone as much as possible to cooperate with Xinghai Investment.

Three days passed in a flash, and Paulson came to the Goldman Sachs headquarters in New York with the collected information.

Paulson was just starting out and was not yet a senior partner.

It was his turn to go on stage only after the senior partners had finished their speeches.

After briefly chatting about a few small projects, Paulson turned on the projector.

"Look, this is the approximate growth of Xinghai Investment's assets after it entered the financial field."

"More importantly, Xinghai Investment has completely withdrawn from Japanese stocks."

Wall Street is well aware of the huge crisis in Japanese stocks.

Because this mine was originally dug by Wall Street.

In fact, as early as 1987, Wall Street had thought about detonating it.

But the Japanese people were too enthusiastic at the time, and there was a serious stock market crash in the United States.

Wall Street did not launch a large-scale attack and prepared to wait until the time was right before taking action.

But this is where Soros got in the way.

He was still shorting the stock heavily and had no idea that the stock price would rebound.

If it had not been for decisive and drastic measures, the famous Quantum Fund might have gone bankrupt long ago.

(End of this chapter)