Chapter 67: Clearing Out Investors

"Mr. Cao, I've thought about it and found that your previous suggestions are very reasonable. It's really not appropriate to include friends in mergers and acquisitions. So, do you think you can help with financing?" Qian Ming said to Cao Shen.

However, he did not intend to reveal the idea of ​​building a mobile site. This excellent strategy could not be shared, so as not to attract competitors. Cao Shen was an investment banker after all, and investment banks were the hubs of news.

As for you will definitely be discovered when you start working, that doesn’t matter. I’m already one step ahead as I’m already working. Being ahead of the curve is very important!

【bite! Host, you failed this random mission. Please accept the punishment, 300,000 RMB will be deducted, and the life value of subsequent complaints will be halved until the accumulation reaches twenty-four months]

"Where's my reward?"

【Already sent to your notebook】

"I don't have a notebook with me now, so you should tell me what it is!"

[Oh, I have upgraded.

Ouch, ouch!

I feel so uncomfortable with the system. It can no longer withstand it and is going to shut down...]

Cao Shen: "What a crappy thing it is!" Even a fool like the system knows how to escape!

[I will remove the host first]

"Hello!"

There is no response from the system...

Qian Ming still looked at Cao Shen expectantly, but Mr. Cao frowned and said nothing.

"Mr. Cao, I know that Yourong has been losing money now. The competition in the WiFi market is fierce, and there are difficulties in transformation. Financing may not be easy. Even if you can't raise money by then, there will be nothing you can do. This is not the case. Deep responsibility.”

If you really can't raise the money, let Maida take it in at a very low price. After all, Yourong's team is still good, so you can just buy the team.

Even though I have cashed out less myself, the overall situation is more important, and I didn’t invest much at the beginning anyway.

Cao Shen nodded: "Indeed, this job is a bit difficult."

Generally, companies that want to raise funds can just list their information on the Jianshen APP.

But Qian Ming specifically mentioned it to Cao Shen. Obviously, Qian Ming wanted not only to put it on the shelves, but also wanted Cao Shen to sell the project himself. In fact, he wanted Cao Shen to endorse it.

You can also find other traditional investment banks to do this.

However, in Qian Ming's opinion, which investment bank currently has a stronger endorsement capability than Cao Shen?

A successful entrepreneur, oh, he recently launched Tongtong Xiaoxiaole, which swept all the major lists. He is simply a business wizard! Can a project endorsed by a business genius be any good?

And behind Cao Shen is Xiao Gang, a top boss!

Not only did he give Cao Shen a platform, but he also gave him money! We made a deep investment together.

What this means is that Cao Shen can pay for investment bank projects himself.

And once Cao Shen pays the bill, subsequent development will be stable!

Boss Xiao will take over in the next round. Boss Xiao can send you to the secondary market and buy stocks!

But the problem now is that the fundamentals of the project are relatively weak, and it cannot be forced. And Qian Ming is also very good at being a good person. He explains his shortcomings in advance. Everyone is in this circle. If he succeeded in cheating today, what about tomorrow?

If cooperation on one project fails, he still has a lot of projects in hand.

Now he is giving it a try. It doesn't matter if the business fails, the friendship must be maintained!

Seeing that Cao Shen was in trouble, Qian Ming quickly said:

"I also know that there are some problems with this project, but if we look for shortcomings in early projects, then every project will have a lot of them." This is the truth.

"Mr. Cao, why don't you buy me a favor and give it a try. It doesn't matter if it doesn't work. If it does, we will draw a commission based on the highest points. Of course, I know that you don't care about this, Mr. Cao. I'm just doing you a favor. "If anything happens in the future, just say it." Qian Ming patted Cao Shen on the shoulder.

Although Qian Ming is not as good as Xiao Gang, he still ranks extremely high in the angel investment circle, and his reputation has always been good.

Cao Shen was also willing to sell him face, and he was so hesitant because he wanted to take advantage of the money to show his favor and prevent him from thinking that things were easy, so he nodded: "Then I will give it a try."

Qian Ming was overjoyed and said quickly: "Thank you, brother. YouRong Technology is in this building. How about I ask them to come over and talk to you directly?"

Cao Shen held Qian Ming's hand: "No hurry, Mr. Qian, do you have the financing materials for Yourong Technology? Send them to me first."

"Yes, yes, yes!" YouRong Technology has been preparing for both acquisitions or continued financing, so the financing materials are ready. Qian Ming immediately sent the materials to Cao Shen.

Cao Shen frowned: "Yourong is only in Series A now, and only 40% of the team's shares are left?"

Qian Ming rubbed his hands: "Yes, it costs money to install WIFI. Many of their merchants provide it for free. The team didn't know how to raise money earlier, so they only took money from individual angel investors. After several rounds, every time It’s been diluted every time and that’s all that’s left.”

"This won't work. This is only the A round. You also said that this model will burn money. After a few rounds of financing, the team's shares will be running out. In this way, the team will have no motivation."

In fact, this is also the reason why Yourong Technology was persuaded to accept the acquisition this time.

YouRong originally wanted to continue to develop independently, but it couldn't stand it and all its previous investors wanted to cash out and leave.

After all, projects in the primary market are not as good as stocks in the secondary market. If you buy them today, you can sell them tomorrow. If it were not for mergers and acquisitions or the next round of financing to be extremely hot and popular, the equity in hand would have to wait for the listing to be cashed out.

The startups that can actually go public are rare, and the equity in their hands may become waste paper if they hold on to it. Individual angel investors use their own money to invest, unlike institutional investors who use other people's money, and have a stronger risk tolerance, so they will stop when they see a good opportunity.

Once acquired, according to the priority clause, investors get the money first and the team last. Calculating, after selling to Mida, the team basically gets nothing. But the proportion of shares is small, and they can't resist the investors' insistence and can only sell.

This is only the A round. Cao Shen counted and found that there are a total of seven individual angels among the shareholders, plus Qian Ming, an institutional angel.

To be honest, this share structure is a bit dissuading Cao Shen.

But think about it carefully, this random task should have been to let Qian Ming promote the acquisition through complaints, which means that the future development system of this company is recognized.

So Cao Shen also made a decision and said to Qian Ming:

"Do all the individual angels want to cash out and exit this time?"

"Yes!" Qian Ming wanted to say that he also wanted to withdraw, but it was not appropriate at this juncture. You asked Cao Shen to help carry the money, you can't just run away while others carry the money.

Cao Shen opened the calculator on his phone and started to calculate: "What is the price for this acquisition?"

"60 million, but there is only 15 million in cash out of this 60 million, and the rest will be exchanged for Mida's shares.

If it is financing, the estimated valuation of this financing is 90 million."

90 million is the offer price, and even if the financing is successful, it will definitely be bargained. So it is reasonable to acquire 60 million, after all, you are the second in front of Mida, and you don't have much bargaining power. It's just a prisoner of war, so just send him away casually.

"If it is an all-cash acquisition, how much cheaper can it be?" Cao Shen asked.

Qian Ming was a little puzzled, but still replied: "We talked about it before. If it is all cash, those personal angels will agree to 50 million."

This is understandable. For many personal angels, it is better to put the money in their pockets than to take the shares of Mida Technology, which may not be successful in the future.

Cao Shen looked at the equity structure. The individual angel investors accounted for 40% and Qian Ming 20%.

He said to Qian Ming: "Please ask the people from Yourong Technology to come over. I want to clear out the investors."

Qian Ming's eyes were startled and he asked in surprise: "Mr. Cao, what are you doing?"

"This equity structure is too bad. It can't be done at all. It must be optimized. I can lend money to the team and use debt-to-equity swaps to clear out all the original individual angel investors."