America's No. 1 financial conglomerate

Chapter 405 Opponent?

Ernst and Quinn were unaware of what these people were thinking; the two were still chatting enthusiastically about their fun times at USC.

Quinn got more and more excited as he talked, gesturing wildly as he said, "Remember that time we went on vacation to Las Vegas? You insisted on gambling with someone, and we ended up losing all the clothes we had on us, leaving wrapped in newspapers."

It would have been better if he hadn't brought it up, because Ernst got angry: "I told you to bet on big, but you insisted on betting on small. Would you have done it this way if you had listened to me?"

"You've been losing all night, is it wrong for me to do the opposite of what you're doing? I was wearing a limited edition outfit, and it was sold off at a 90% discount because of you."

"Didn't I win it back for you later?" Ernst raised his voice.

"You might as well not have won." Quinn said angrily, downing his drink in one gulp, which drew a loud laugh from Ernst.

"You were so happy and insisted on celebrating, you drank too much and wouldn't let go of the slot machines in the casino, you insisted on becoming sworn brothers with them, what does that have to do with me?"

"That's a rumor you made up. I don't remember it at all," Quinn retorted stubbornly.

Seeing that Ernst was about to speak, Quinn quickly changed the subject, "By the way, what brings you to this retail industry conference? You're not thinking of getting into the retail sector, are you?"

He was curious to see Ernst in Albany, since Ernst's business and retail sectors were completely unrelated.

Ernst nodded slightly upon hearing this, then calmly said, "I suppose so."

Quinn was surprised; he had only mentioned it casually and had no idea that Ernst actually intended to enter the retail sector.

His eyes widened, and he instinctively asked, "Why? The internet is so great! Retail doesn't offer the same overnight riches you can get through the internet."

In his view, the internet industry is like an inexhaustible gold mine with unlimited wealth potential, while the retail industry is highly competitive and slow to generate profits.

Why not stay in the lucrative internet industry and compete for a piece of the red ocean of the retail industry?

If it weren't for his father's objections, he wouldn't have obediently stayed with the family business; he would have taken a large sum of money and ventured into the internet industry long ago.

Since the beginning of this year, the development trend of the entire Internet industry can be summed up in four words: incomprehensible.

For any newly established internet company, regardless of whether the product it develops has any real value or how many users it has, once the product is officially launched, funds will pour in like a whirlwind, with countless institutions lining up at the door to invest.

Almost every day when Quinn opened the newspaper, he would see news of internet startups receiving funding, each one of which he found unbelievable.

Two days ago, he saw a news report about a small portal website company with just over 10,000 users that had secured hundreds of thousands of dollars in funding, bringing the company's valuation to over three million dollars.

Three million dollars might not seem like a huge sum to Quinn, given that his company's assets are far greater than that.

But the key point is, how long has this company been established? And the investment is pitifully small.

This speed of wealth creation is something the retail industry could never have imagined, and will never be able to achieve.

Especially after YueDong Games successfully went public, this frenzied trend in the internet industry intensified.

Startups don't need to worry about funding at all; as long as they have a seemingly viable project, they can easily secure investment.

The market value of leading internet companies is growing at an astonishing rate, constantly redefining people's understanding of the market.

Take his company Meijer as an example. It has nearly 100 stores in five states, and has also established a transportation company, built large warehouses, and even acquired several slaughterhouses to ensure the supply of fresh products.

Even so, the total market value of the entire Meijer Group is only around $18 billion.

Looking at other internet companies, Microsoft's market capitalization has soared from about $250 billion at the beginning of the year to nearly $400 billion now. In just over seven months, its market capitalization has increased by $150 billion.

Cisco has performed equally well; its stock price has nearly doubled since the beginning of the year, and its market capitalization has exceeded $1800 billion.

Although Google is not yet publicly listed, Quinn knows that the $1500 billion market capitalization circulating outside is simply outdated.

The reason why some media outlets and institutions are still using this valuation to measure Google is simply because Wall Street investment firms can no longer provide a more accurate valuation quote.

The stock prices of internet companies are growing so rapidly, almost changing every day, and no one can predict how much the market value will rise in the next second.

Moreover, unlike most internet companies that are still burning money and have not yet found a profitable business model, Google, like Microsoft and Cisco, has already achieved substantial profits and found a stable and reliable way to monetize.

$1500 billion?

Even Quinn, who doesn't know much about the internet industry, knows that if Google goes public, it's only natural that its market value would double to $300 billion, and even if it surpasses $400 billion, not many people would be surprised.

Quinn saw it clearly: the reason Wall Street dared not give a higher valuation, or even deliberately lowered expectations, was because they were terrified by what happened when YueDong Games went public.

When YueDong Games went public, many retail investors held onto their shares and refused to sell, making it difficult for institutional investors to control the stock's price movement.

Wall Street is worried that Google will repeat the same mistakes when it goes public, so it deliberately doesn't give a reasonable valuation quote in order to lower investors' expectations.

In this way, when Google officially goes public, the offering price will appear to be a significantly high price in the minds of investors who have been brainwashed by the $1500 billion market capitalization, and someone will definitely buy in.

At that time, Wall Street institutions can take the opportunity to acquire a portion of the stock at a lower price, and then quickly drive up the stock price to make huge profits.

However, in Quinn's opinion, this trick wouldn't fool any fools.

Google's delay in announcing its IPO price is like a fishbone stuck in the throat of Wall Street, making them uneasy.

Clearly, Google understood that the internet industry was experiencing such a surge in growth. Since there were still several months until the official IPO, the offering price could be finalized a few days before the bell-ringing ceremony, so they deliberately delayed it.

If Google successfully goes public, its market value could increase in a single day enough to buy the Meijer Group, just like Microsoft and Cisco are now.

Given the rate at which wealth is growing in the internet sector, no one can resist drooling over it. Quinn simply couldn't understand why Ernst would abandon the internet industry and choose to enter the retail sector instead.

Ernst, seeing the puzzled look on Quinn's face, slowly said, "While the retail industry can't make people financially free overnight like the internet industry, its advantage lies in its stability."

When Ernst said this, his eyes were very serious, and his tone carried a subtle hint of guidance, which was more of a psychological suggestion to Quinn.

He could clearly sense that Quinn's eyes sparkled with excitement when he talked about the Internet, and he had an eager expression, clearly showing his longing for the Internet industry.

Ernst had no doubt about Quinn's abilities.

Although the two did all sorts of bad things together in college, it doesn't mean they were uneducated.

Quinn is the kind of person who, once he sets his mind on something, either doesn't do it at all, or he devotes himself entirely to it, never giving up until he achieves his goal; he has an indomitable tenacity.

In today's era of ever-expanding internet bubble, Quinn's overly persistent and unwilling-to-give-up personality is the most dangerous.

Once he invests a large amount of money into the internet industry, he is likely to lose everything when the internet bubble bursts in the future, and ultimately be buried in the graveyard of the internet.

But now, he doesn't want Quinn to rush in at this time.

"Don't be fooled by the rapid growth and booming state of the internet industry right now. We all know that such growth is illogical and completely contrary to normal business principles."

"When the economy encounters problems and enters a downward trend, people can choose to stay away from the Internet and reduce their consumption of Internet services and products, but they absolutely cannot abandon their basic living needs such as food, clothing, housing and transportation."

"The retail industry is a key sector that meets people's needs for food, clothing, housing and transportation. No matter how the economic situation changes, the retail industry can maintain a relatively stable development trend."

Quinn nodded subconsciously. He didn't deny this statement; food, clothing, shelter, and transportation are in surplus in any country, and are also where competition is most intense.

Quinn picked up his glass, gently swirling the champagne inside. A complex emotion flickered in his eyes. Then, he raised the glass, looked at Ernst, and said with a smile, "Looks like I'll have a potential rival from now on?"

Although Quinn knew that Ernst was going to enter the retail industry and might become a competitor to his family business in the future, Quinn's face showed no tension or worry about Ernst becoming a potential threat.

On the one hand, he has full confidence in his family's Meijer Group.

In the retail industry in the Midwest, even retail giant Walmart has to back down when facing Meijer, and Quinn is not afraid of any external competition.

Another point is that he knows that even if Ernst really makes a big push into the retail industry, the initial battleground will only be concentrated on the East or West Coast. Only in densely populated and prosperous areas can more breakthroughs be made.

The retail industry in the United States is highly developed, and the level of market competition is among the highest in the world.

Looking across the United States, there are very few companies that can achieve the status of a retail giant like Walmart, with stores all over the country.

Ernst’s attempt to break through in the highly competitive East and West Coast retail markets is no easy feat, and whether he can expand his business to the North Central region where the Meijer Group is located remains to be seen.

To Quinn's surprise, Ernst shook his head after hearing his words and said calmly, "What I mean by entering the retail industry is different from what you understand."

Quinn's smile faltered slightly, his eyes filled with inquiry as he awaited further explanation.

Ernst met Quinn's questioning gaze and explained, "In fact, to be more precise, what I'm investing in isn't traditional retail department stores, but rather e-commerce in the retail industry."

"Amazon?" When Quinn heard the words "e-commerce" in the retail industry, the name Amazon immediately came to mind, and he blurted it out subconsciously.