Chapter 1494 Underwriter

After thinking about Li Mu's experience, Mark Zuckerberg immediately made his decision. After chatting with Larry Page, he said to Li Mu in private: "Mr. Li, I have carefully considered it. Now, decide to take Mr. Page's advice, take a break from Harvard, and move the company to Silicon Valley, what do you think?"

Li Mu smiled slightly and said, "I support the suspension, because the next few years will be the golden period for the rapid development of the Internet. If you are half-length at school, this high-speed train will tear you apart when it starts. But it’s not a good time for you to move your company to Silicon Valley.”

Mark Zuckerberg asked inexplicably: "Why? Silicon Valley is the center of the industry. If you are in Silicon Valley, you can get access to more core resources in the industry."

Li Mu said with a smile: "Your current business line is aimed at college students. Silicon Valley is a gathering place for Internet elites, but it is not a gathering place for college students, so what you have to do now is to temporarily take a break from school, and then go all out. Into the huge ivory towers of college campuses and college students across the country."

After speaking, Li Mu asked Mark Zuckerberg, "Have you noticed that the few people just now, including Larry Page, didn't care too much about the core of the Facebook project?"

Mark Zuckerberg nodded and said, "It's exactly what you said."

Li Mu said, "Do you know why?"

Mark Zuckerberg shook his head.

Li Mu said with a smile: "Because they don't think you are a real Internet entrepreneur deep down in their hearts, they think you are just a college student who is playing around with college students, and your project is just a college student who is playing around with you. Project, this proves that they themselves do not pay so much attention to the college student group, just like the mentality of the NBA Lakers to a certain college campus basketball team, they think that you are not professional players at all, and your level and prospects are not worth mentioning at all. "

Mark Zuckerberg agreed: "Indeed..."

Li Mu snapped his fingers and said with a smile: "This is the best situation. When others start, their growth depends on Gou. If a little emerges, the boss will quickly annihilate him, but you are starting right now. In a field that these so-called bigwigs do not pay attention to or care about, however, this group has tens of millions of potential users and nearly 100 million potential users around the world. You were already one of the big guys in Silicon Valley when college campuses hit Silicon Valley.”

Speaking of this, Li Mu added: "There is a great man in China who once created the great strategy of encircling the city from the countryside. Now this strategy is just right for you to learn and follow. For the elites in Silicon Valley, only Silicon Valley, New York, Los Angeles, and Wall Street can be found. It is the 'city' of the Internet industry,

It is suitable to use the strategy of encircling the city from the countryside, to catch them by surprise. "

Mark Zuckerberg couldn't hide his excitement and said: "Then I will take a leave of absence after I go back, and then quickly make Facebook bigger and stronger among the college students!"

Li Mu nodded: "I will arrange for you to call for the additional investment funds soon, and Larry Page will guide you all Google's search traffic about colleges. You don't have to worry about anything next, and focus on Let’s expand rapidly among college students.”

...

After chatting with the guests from afar at the reception, Li Mu met privately with Steve Johnson, the head of Sequoia Capital. teve Johnson is most concerned about the follow-up capital operations of Muye Technology and Li Mu's other companies. Sequoia has tasted huge benefits from Muye Technology, and he can't wait to find other breakthroughs, but Li Mu's current attitude towards capital Be extra cautious. Due to the upward trend of the global capital market, Li Mu now hardly gives any opportunity for capital to penetrate, which makes Steve Johnson scratch his head.

Whenever the capital market is down, companies are anxious to raise funds. Because they are worried about the capital winter that may come at any time, they sacrifice some shares in advance and reserve cash to survive the winter. But whenever the capital market is up, companies start Grit your teeth and wait until the price continues to climb before selling the stake.

Now that the global capital market is doing very well, Li Mu naturally is not in a hurry to raise funds, but is looking forward to being able to achieve a super large-scale fundraising through listing.

After Li Mu sat down with Steve Johnson, the latter handed Li Mu a cigar and said with a smile, "Mr. Li, try it, the world's top Cuban cigar."

Li Mu shook his head and said with a smile, "Thank you, but I'm not used to smoking this stuff."

With that said, Li Mu took out a pack of domestic cigarettes from his pocket and asked him, "Want to try this?" teve Johnson hesitated for a moment, then smiled cheerfully, "OK, try it."

Li Mu pulled out two panda cigarettes, handed one to him, lit one himself, and then asked him with a smile, "Steve, you are so anxious to ask me to meet, is there anything good to take care of?" teve Johnson lit a cigarette He took a sip, tasted it a little, then spit out white smoke, and said with a smile: "To be honest, Sequoia has been preparing a lot of cash just waiting for you to greet you, but if you don't want to do another round of financing, I can't help it... …”

Li Mu smiled indifferently and said, "Apple has already acquired, and financing is no longer attractive to me at this time." teve Johnson said, "So I am not going to talk to you about financing this time, I just want to Talk to Mr. Li about the future IPO of Muye Technology."

Li Mu raised his eyebrows and asked him, "What do you want to talk to me about about the IPO?" teve Johnson smiled: "I mainly want to know the approximate time plan of Muye Technology's IPO."

Li Mu said: "After both Google and Baidu are successfully listed, Makino Technology will start its own IPO plan." teve Johnson nodded and said with a smile: "Mr. Li is really scheming, after the two companies have both IPOs, The valuation of Muye Technology will rise further, which is indeed the best time."

After a flattery, Steve Johnson asked Li Mu with a serious expression: "Mr. Li, Muye Technology should have already started preparing for the IPO, right? Can you disclose the current progress?"

Li Mu smiled noncommittally and said, "Steve, if you have any ideas, you can say it directly. We are partners anyway, so there is no need to go around." teve Johnson hesitated for a moment, then said, "Mr. Li, in fact, yes. Sequoia and myself are very much looking forward to in-depth cooperation with you on the IPO of Muye Technology. We have estimated the future valuation of Muye Technology. Under the condition that Muye Technology maintains the current growth rate unchanged , coupled with an additional 30% stake in Google, Makino's IPO fundraising is likely to exceed $20 billion, creating the largest IPO in Nasdaq history. However, all of this must be based on a mature Based on a reliable and strong team of underwriters.”

Li Mu nodded. At this time, he already understood Steve Johnson's motives. What he wanted was the underwriter qualification for the future IPO of Muye Technology.

In a Nasdaq IPO, the first step is to submit for review, and the second is to find a suitable underwriter team, and then determine the valuation, number of shares and price with the other party, and then the other party will sell the IPO shares to The major customers in their hands, generally speaking, the stocks issued by US stock IPOs are basically not for retail investors. They are all divided up at the level of major customers with assets exceeding one million US dollars, and they can fall into the hands of retail investors at the IPO stage. stocks are generally junk stocks.

Sometimes, when a company fails to go public in the United States, it is not because the company does not meet the requirements for listing on Nasdaq, but because the company is not satisfied with the price given by the underwriter. The former domestic literary giant, Shanda Literature, has repeatedly launched plans to go public in the United States , but it was launched and stranded several times, and finally gave up the overall sale of the listing. The main reason for the stranded listing was the valuation differences with the underwriters.

A company will have two valuations before it goes public. One is the company’s own valuation of itself, and the other is the capital market’s valuation of itself. This is no different from looking for a job and communicating with the employer. If the offer is lower than expected, most job seekers will reject it, and if job seekers ask for higher salaries, most companies will also reject them.

If a company that is preparing to list on Nasdaq has a target valuation of $1 billion, they hope to raise $100 million by issuing 10 million shares at $10 per share, accounting for 10% of the company's total shares , but the underwriters feel that the prospects of this company are not as good as the company itself thinks. In the eyes of the underwriters, the valuation of this company can only be given to 500 million US dollars. If other conditions remain unchanged, the corresponding share price The price of $5 can be sold, and if the price is higher, it is difficult to sell all the shares issued by the IPO.

On this basis, if the company accepts the underwriter's valuation, then he also takes out 10% of the shares, but can only raise 50 million US dollars. It is naturally difficult to accept the psychological expectation. No one is willing to budge on this issue, so this time the IPO can only be stranded because of huge differences.

Therefore, in the process of IPO, the role of the underwriter is still very important. The strength of the underwriter must be sufficient, and the underwriter must recognize the value and prospects of the client company. Although Muye Technology has a high reputation worldwide , and the recognition of the capital market is also very high, but if it involves an IPO, it is still necessary to have a reliable underwriter to work together and strive to maximize the benefits for the company in the process of listing.

At any time, the best selling price for the seller is just close to the upper limit that the buyer can accept. The same is true for Li Mu.

So Li Mu asked him, "Do you want to be an underwriter of Muye Technology?" teve Johnson nodded calmly at the moment and said, "Mr. Li, to be honest, with the size of Muye Technology's IPO, I am afraid that any investment bank will It is impossible to eat it by yourself. According to our estimation, at least three to six first-tier investment banks are needed to form an underwriting team together. We hope that with our close cooperation with Muye Technology, we can become the lead bank for the IPO of Muye Technology.”