NABC Chapter 160: Series B Launch, WeChat Launch
Chapter 160: Series B Launch, WeChat Launch
Chapter 160: Series B Launch, WeChat Launch
Beijing, China World Trade Center, Sequoia Capital headquarters.
Shen Nanpeng and Yang Dong had just finished discussing with Xu Xiaoping and Wang Qiang the matter of jointly establishing ZhenFund.
Yang Dong escorted the two to the elevator, while Shen Nanpeng got on the treadmill and started exercising in front of the floor-to-ceiling window.
The phone rang suddenly.
He didn't look at his phone; he simply turned on his Bluetooth headphones and answered the call while running.
[Straightforward]: "Senior Shen, our Mingfan Technology is preparing for our Series B funding round, so we need to stockpile more resources."
A straightforward voice came through the phone; he didn't exchange any pleasantries or formalities and went straight to the point.
Shen Nanpeng was very excited when he heard that Momo was going to raise its Series B funding round, and he was even panting heavily.
[Shen Nanpeng]: "Xiao Geng, not bad, not bad. I was just about to contact you. Momo's development has exceeded expectations again. It's time for the next round of financing."
""
[Straightforward]: "Yes, Senior Shen, I came to find you as soon as possible."
[Shen Nanpeng]: "Okay, how much are you planning to raise in the Series B round?"
[Straightforward]: "2500 million US dollars, selling 10% of the equity, no bargaining."
A straightforward and calm voice came from the Bluetooth headset.
Shen Nanpeng was running perfectly fine when he heard Geng Zhi's words, and he stumbled, almost falling off the treadmill.
[Shen Nanpeng]: "How much? Say it again? Are you crazy?!"
[Straightforward]: "2500 million US dollars, selling 10% of the equity, no bargaining."
Geng Zhi repeated it again earnestly.
Shen Nanpeng, who valued his life, didn't know what other outrageous things Geng Zhi would say next, so he quickly got off the treadmill, returned to the sofa, and plopped down.
As he sat, he kept repeating an English phrase.
[Shen Nanpeng]: "How dare you? How dare you? How dare you?"
Yang Dong, who had just dropped off Xu Xiaoping and her companion and returned to his office, heard his boss speaking fluent English and glanced over, puzzled.
He guessed that Sequoia Capital in the United States had another argument with its boss over funding issues.
Although she was very curious and wanted to see what was going on, after hesitating for a few seconds, Yang Dong quietly returned to her office. She would occasionally look up and glance at Shen Nanpeng on the sofa through the glass wall.
On the phone, Geng Zhi and Shen Nanpeng were already arguing fiercely, but they were talking past each other completely, like casting pearls before swine.
Both sides felt that the other was the bull.
[Straightforward]: "Senior Shen, think about it, in just three months, your Series A funding has increased seven or eight times! You've made a fortune!"
[Shen Nanpeng]: "Xiao Geng, valuation isn't calculated like that. We use the industry-standard comparative valuation method. When Renren.com reached 8000 million users, its valuation was $20 billion. That averages out to $25 per user. Momo's 400 million users are worth about $1 million."
[Straightforward]: "Senior Shen, Momo is currently in a period of explosive growth, and what it lacks most is talent. Talent is very expensive, and it requires money—"
[Shen Nanpeng]: "Xiao Geng, you have to understand, this is even after Renren.com has already succeeded. Actually, we all know that Renren.com's valuation is inflated, and each user is not worth $25 at all."
[Straightforward]: "Senior Shen, mobile games are poised for explosive growth within a year. If we plan ahead, acquire one or two hit games to drive traffic, seize the opportunity to do mobile game co-publishing, and even expand overseas in the future, there will be great potential!"
[Shen Nanpeng]: "Xiao Geng, let's value it based on its growth potential. Momo broke 400 million users in 3 months. Even if the mobile user penetration rate is extremely high, the number of users will reach 600 million in 2 months. If we calculate the value of each user at 20 US dollars, the total valuation will be 1.2 million US dollars."
[Straightforward]: "Senior Shen, once our Series B funding is completed, in addition to continuing to attract new users, we will also optimize Momo's chat function and create a brand new communication system to bring users the ultimate chat experience."
[Shen Nanpeng]: "Xiao Geng, let's value it based on the competitive premium. Momo is the absolute leader in the LBS stranger social networking field, with a clear first-mover advantage and has captured users' minds—a valuation of 1.2 million US dollars is the upper limit."
【耿直】：「沈学长，我们融资的2500万美金，分配到18个月里。陌陌主产品线，消耗800万美金。游戏联运业务大概500万美金。新通讯系统消耗700万美金。竞争备用金500
Ten thousand US dollars.
[Shen Nanpeng]: "Based on the valuation multiple of daily active users, 1.2 million daily active users * $100 per daily active user would result in a valuation of around $120 million."
[Straightforward]: "Senior Shen, you're an A-round investor, that's why I'm discussing this with you first."
[Shen Nanpeng]: "Xiao Geng, based on the above, your company's valuation can only be up to 1.2 million US dollars —"
[Straightforward]: "For this Series B round, I will bring in two or three new capital firms. Top-tier VCs will be considered, such as Matrix Partners, IDG Capital, and KPCB. Strategic investors will be chosen from Alibaba and Xinlang."
hiss-!
Shen Nanpeng, who was still talking to himself and earnestly explaining various valuation calculation methods to Geng Zhi, was suddenly taken aback.
Only then did he understand the meaning of Geng Zhi's last sentence.
[Shen Nanpeng]: "Xiao Geng, have you thought through all the new investors you've brought in?"
[Straightforward]: "Yes, I've done the research. And the maximum amount I can give you is only 1000 million US dollars."
Shen Nanpeng: "————"
[Straightforward]: "Senior Shen, I am straightforward in my career and only adhere to one principle: as long as I am straightforward in my involvement in a field, I will only strive to be number one in the industry."
Fifteen seconds later, Geng Zhi was the first to hang up the phone.
"As long as I'm honest and straightforward, I'll only strive to be number one in the industry," Shen Nanpeng continued to ponder this statement.
Seeing that Shen Nanpeng had hung up the phone, Yang Dong quickly came out of the next office and went to his side.
Seeing that Shen Nanpeng on the sofa didn't look too good, Yang Dong asked curiously, "Neil, is it that the Americans are starting to interfere again?"
Shen Nanpeng shook his head: "No, it's just being straightforward."
Upon hearing that it was Geng Zhi, Yang Dong immediately breathed a sigh of relief.
Wait, how could such straightforwardness have angered the boss like this?
Yang Dong's heart, which had just been at ease, immediately tightened again: "Neil, what earth-shattering feat has that young master Geng pulled this time?"
"He called me and said he wanted to raise Series B funding," Shen Nanpeng said calmly.
"Hey, this is a good thing! With Momo's current data and growth trend, raising a Series B round ahead of schedule shouldn't be a problem, right?" Yang Dong asked, puzzled.
"He wants to raise $2500 million, and he's only giving up 10% of the equity."
boom-!
Yang Dong's eyes widened in surprise.
$2.5 million for just 10% of the equity, that's a valuation of $2500 million!
In just three or four months, its valuation has increased sevenfold, which is even more dramatic than its American originator. This is far too aggressive!
"No, Neil," Yang Dong exclaimed in surprise in English, "howdarehe? howdarehe?"
Seeing that Shen Nanpeng did not respond, Yang Dong suddenly guessed, "Could it be that Young Master Geng is also going to enter the group-buying market?"
He felt that only this one reason could explain such a high valuation.
Shen Nanpeng shook his head: "No, he did it to protect Momo and prepare for future competition."
He then added, "Moreover, he plans to make a game, both self-developed and jointly operated."
"Oh, I see."
Yang Dong didn't know much about the gaming industry. But he knew that Geng Zhi had always had the idea of making games.
At the last Momo press conference, Geng Zhi decisively announced [Momo will be free for 100 years], which really surprised Shen Nanpeng and Yang Dong.
Afterwards, Geng Zhi promptly called Shen Nanpeng and Yang Dong to explain that Momo was going to "exchange free services for traffic" and then monetize through games and GG, which convinced Shen and Yang.
It's fortunate that it was Sequoia Capital; if it were any other investor, they might have already fallen out with Geng Zhi.
However, Momo's subsequent rapid growth proved that its straightforward decision was absolutely correct, and it also won the approval of Shen...
The two men, Yang and Yang, highly approved of it.
"Neil, do you really have faith in the gaming industry?" Yang Dong asked.
Shen Nanpeng shook his head: "It's hard to say, but he gave me the example of Fruit Ninja. He is 100% certain that mobile games will explode in the future."
Yang Dong remained silent, quickly calculating Momo's valuation in his mind using several valuation methods, before speaking again: "Even so, I still think Momo's valuation is at most $1.5 million. His asking price of $2500 million is definitely inflated. Besides, he can't possibly spend all $2.5 million!"
Shen Nanpeng: "What I'm worried about isn't actually these things."
"Hmm?" Yang Dong asked, puzzled. "Neil, what are you worried about?"
"Geng Zhi concluded by saying, 'As long as I'm involved in a field, I will only strive to be number one in the industry.'" Shen Nanpeng repeated this again.
"That's a good thing!" Yang Dong said with a smile. "It proves that Young Master Geng has ambition and courage. Entrepreneurs should have this kind of spirit."
"He also said that he wanted to bring in a strategic investor, either Alibaba or Xinlang, one of the two," Shen Nanpeng continued.
"oh."
"He specifically emphasized that he wants to optimize Momo's chat function and create a brand new communication system to bring users the ultimate chat experience," Shen Nanpeng added at the end.
"It's just optimizing a chat function; it's just a routine feature iteration!"
Yang Dong had just finished speaking when he suddenly realized something.
Gengzhi wants to enter the gaming industry, Gengzhi wants to create an instant messaging system, and the new companies or Alibaba that Gengzhi has introduced are all competitors of Tencent!
To become number one in the industry—isn't that just about painting a penguin?
Yang Dong exclaimed, "Neil, is this young master Geng really going to rebel now?"
The "anti-hegemony" that Yang Dong mentioned naturally refers to Shen Nanpeng's previous guess that Momo would go to war with Renren and QQ in the future, snatching food from the tiger's mouth.
Originally, Shen Nanpeng and Yang Dong both regarded "anti-tyranny" as the vision of Mingfan Technology Company, thinking it was something that happened in the distant future.
But at that moment, the two realized that the future had arrived.
Shen Nanpeng remained silent, which was tantamount to acknowledging Yang Dong's guess.
The room was quiet for more than ten seconds as the two of them fell into deep thought.
"Neil, did Young Master Geng say how to make that communication product? Is it going to be a high-quality imitation of QQ?" Yang Dong broke the silence first.
"I don't know either." Shen Nanpeng shook his head.
During the phone call, Geng Zhi only vaguely told Shen Nanpeng that he wanted to create an optimized version of the chat system, without going into details.
Geng Zhi didn't dare to talk too much about his new product, firstly because of the need for confidentiality, and secondly because he was worried that it would scare away investors, and ultimately no one would dare to invest.
Yang Dong bit her lip and shook her head repeatedly: "Neil, Young Master Geng has really gone mad. I admit he's very capable, and Momo is growing very fast, but compared to QQ, it's still nothing."
"And besides, I can't even imagine what new tricks his new product will have up its sleeve. Even if it does, what then?"
"I know he's a marketing genius, and this time he might be trying to create another big event by leveraging public opinion. But no matter what, Tencent won't allow him to succeed, after all, QQ is its foundation."
"Young Master Geng is courting death!"
Yang Dong spoke for a while, but seeing that Shen Nanpeng was still deep in thought and had not expressed his opinion, he continued, "Neil, investing in Tencent's direct competitors is too risky. When Tencent goes on an offensive, nothing survives! Instead of investing a huge sum in Momo, we would be better off using the funds in better targets like Jumei, Vipshop, and Tuniu."
Shen Nanpeng slowly raised his head and looked at Yang Dong: "If we don't invest, Matrix Partners, IDG, KPCB, and Jinshajiang might all step in, and our shares will be diluted again. And if Geng Zhi (a nickname for a person) succeeds in the end—his chances of success are slim—"
Meanwhile, Geng Zhi, who had just hung up on Shen Nanpeng, had returned to his office and was preparing for his meeting with Yu Chengdong.
As for why Lao Yu wanted to invest in Momo, he was actually quite puzzled, but that didn't stop him from trying to find out.
He knew Lao Yu's personality; it would be quite amusing to put on an act in front of him.
As he pondered, he couldn't help but hum a little tune.
Ten years ago, you didn't know me, I didn't belong to you, and we were still equals.
Lu Siyu, who was helping Geng Zhi pack his things, couldn't help but laugh when she saw this: "Boss, this is the first time I've seen you so relaxed and at ease before meeting with investors!"
"That's the feeling of fortunes changing every thirty years, you wouldn't understand," Geng Zhi said with a smile.
Lu Siyu truly didn't understand and could only shake her head.
"Boss, we're just discussing financing, should we invite General Manager Tang along?"
"No need. I don't think Lao Yu will vote for us, so let's not call him this time. We'll call him later when we go to the capital."
The two began to go downstairs.
Gu Wanning's Maserati was parked downstairs.
During this period, Gu Wanning and the Arctic Capital team were on business trips in Canada, and she lent her car to Geng Zhi.
While fastening his seatbelt, Geng Zhi said to Lü Siyu in the back seat, "Siyu, you should probably get a driver's license. You can't always expect me, the boss, to drive you around."
""
7:20pm.
Geng Zhi and Lü Siyu arrived at a private room in a high-end club in Linjiang ten minutes early, with the Oriental Pearl Tower right outside the window.
At night, the Bund is ablaze with lights on both banks of the Huangpu River. The night breeze, carrying the scent of the river, seeps in through the cracks in the windows.
Geng Zhi was still pondering what Lao Yu's position should be at the chrysanthemum factory at this moment.
President of Strategy and Marketing? CMO?
Lu Siyu sat next to him, with a laptop and a printed BP spread out in front of her.
At 7:28, the door to the private room was pushed open.
A man in a dark gray suit walked in, without a tie, carrying only a cell phone and a leather notebook.
"Boss, Mr. Yu is here." Lu Siyu said, standing up with a smile.
Geng Zhi also stood up, turned his head, and his brows furrowed instantly.
The man in front of them was not Yu Chengdong, who was 40 years old, but a man who was nearly 50 years old.
Geng Zhi looked at the man, then at Lü Siyu.
Lu Siyu had no idea what the boss meant, and simply smiled.
"Mr. Geng, it's an honor to meet you." Yu Feng smiled as he approached the table and extended his hand.
"Hello." Geng Zhi greeted him politely with a handshake, but in his heart he had a million questions.
The waiter came in, poured the tea, and then left.
The three of them started chatting, from the weather to the World Expo, and then to the clubhouse.
Geng Zhi had been cooperating, but he still couldn't figure out who the old man in front of him was, until Yu Feng said the following: "Mr. Geng, I heard Mr. Ma talk about you when I was in Lin'an. He said you are the most resilient young man he has ever met."
At this moment, Geng Zhi realized that this "[General Manager Yu]" was Yu Feng from Yunfeng Fund.
He had originally wanted to find an opportunity to contact Ma Jie again to sound him out, but he didn't expect Yu Feng to take the initiative to come to him first.
What a coincidence!
But all his preparations before his arrival were focused on Yu Chengdong. He knew nothing about Yu Feng except that he was the person in charge of the Yunfeng Foundation.
His greatest belief was that knowing yourself and your enemy is the key to victory, but this time, he had to start from the bottom, being blind.
Geng Zhi smiled and said, "Teacher Ma, you flatter me."
Yu Feng: "I greatly admire General Manager Geng's [industry expertise] ————"
As a Shanghainese, Yu Feng prefers a slow pace, so Geng Zhi accompanied him, starting with casual conversation and gradually getting to the point.
"Mr. Geng, 400 million mobile users in 3 months is indeed impressive. But I'm curious, if you're foregoing membership fees, how will you make money? Is mobile going to fail?" Yu Feng's tone became more formal.
"GG and games." Geng Zhi didn't hide anything and said with a smile, "President Yu, you were the CEO of Focus Media and the president of Focus Media, so I won't show off the GG model in front of you."
2
Yu Feng waved his hand modestly.
Geng Zhi continued, "Let me talk about games. There's a Japanese social gaming platform called GREE, and their Q1 revenue was $1.2 million. Momo's..."
Users are younger and more active than GREE, and their social relationships are naturally suited to gaming.
Next, Geng Zhi gave Yu Feng a general overview of Momo's approach to game development, including how to build a platform, distribute content, conduct joint operations, and generate revenue sharing, as well as future revenue projections.
"Mr. Geng, I understand your logic, but do you have data to support your prediction of Momo Games' revenue?"
"GREE's data is the best support. Japanese users can pay, and so can our users. And one..."
He took a sip of tea before continuing: "Among Momo users, 83% are young people aged 18-30, of which 65% are male and 35% are female. This group has the highest willingness to pay for games."
Yu Feng wrote a few lines in his notebook, then looked up: "What about your game team? Are you developing it yourself or publishing it?"
Geng Zhi: "We'll distribute and act as agents first, then develop our own games. We've already contacted several game developers, and they're very interested."
Once we reach 1000 million users, the game's revenue will be able to cover operating costs.
Yu Feng pondered for a moment, then changed the subject instead of pressing further: "You just said there's a [new project]?"
"Yes, Momo is just the beginning. The value of the new project far exceeds that of Momo."
Yu Feng immediately became interested and hurriedly asked, "What exactly does the new project involve?"
Geng Zhi stood up, walked to the window, and looked at the night view of the Bund: "President Yu, I'm the kind of person who likes to surprise my friends and scare my rivals. If I say too much now, it won't be a surprise anymore."
Yu Feng was taken aback, then laughed: "So you're not planning to tell me about this potential investor today?"
Geng Zhi gave a polite smile that was neither awkward nor embarrassing, and sat back down in his seat: "Once the Series B deal is completed, I'll be the first to tell President Yu."
Seeing this, Yu Feng had no choice but to give up asking questions and start talking about valuation.
"What was the amount and valuation of Mr. Geng's Series B funding round?"
"Raised $2.5 million by selling 10% equity, valuing the company at $2500 million."
Cough cough—!
Yu Feng choked on his tea.
Yunfeng Capital is a newly established fund, with a total fund size of only 3 million yuan currently under management. This amount of financing is indeed a bit high.
"No, Mr. Geng, your business has increased eightfold in just over two months?!"
"Yes, because we have a surprise," Geng Zhi said calmly.
"No, Mr. Geng, you can't be that suicidal!" Yu Feng laughed. "What if you raise a lot of money with a completely unreasonable project? Wouldn't all the investors be fools?"
"President Yu, when Momo raised its Series A funding, Zhu Xiaohu from Jinshajiang thought the same thing, as did Teacher Xu Xiaoping, and Teacher Ma Jieke. Only that foolish and rich Shen Nanpeng believed it."
"And the result?" Geng Zhi shrugged and spread his hands.
Yu Feng was speechless.
He remained silent for a long time, his fingers tapping lightly on the table, before asking, "What will you do if Yunfeng doesn't surrender?"
Geng Zhi laughed: "Sequoia Capital has agreed to co-invest, Matrix Partners is also interested, and KPCB is in contact with us—we really don't lack investors."
He took another sip of water, coughed lightly, and continued, "The reason I agreed to meet with President Yu is that I think our users might need to buy things, make payments, and access local services, which could create a strategic synergy with Alibaba."
Yu Feng nodded, which was also one of the main reasons why Ma Jieke was interested in Momo.
"Mr. Geng, how many investors will be coming into your Series B funding round?" Yu Feng asked again.
"Besides Sequoia, if we add 2 to 3 more companies, and if Mr. Yu's Yunfeng joins, my investment limit for you will not exceed 1000 million US dollars. We will have to compete with the other companies for the exact amount."
Yu Feng nodded and said nothing more.
He has a positive view of Momo's products, and he has an even stronger positive view of Geng Zhi (a straightforward and honest person).
As for the new project mentioned by Geng Zhi, he believed in the character of [the industry veteran] and had a few guesses.
"Mr. Geng, to be honest, Momo is our Yunfeng Fund's first project. I need to go back and discuss the specific investment with Mr. Ma. I'll give you an answer within two days, is that alright?" Yu Feng asked.
In fact, Ma Jieke had given Yu Feng authorization, but the valuation that Geng Zhi asked for did exceed their previous expectations, and he needed to go back and confirm with Ma Jieke.
"Okay, Mr. Yu, I'll wait for your news." Geng Zhi said with a smile, "But I believe Teacher Ma will definitely agree."
"Oh? Why do you say that?" Yu Feng asked curiously.
"Because he doesn't want to be blind a second time."
"Hahaha!"
Tuesday morning at 8:45, Mingfan Technology office.
Li Xiaoyue, the first operations staff member to arrive at the company, was browsing Renren.com when she suddenly saw a new message in a Renren group.
She quickly took out her phone, downloaded an installation package called [Private], and began to immerse herself in the experience.
-
This is a stranger social networking app developed by Renren.com. It has not yet been officially released. Only an installation package has been circulating in a small circle, mimicking Momo's strategy back then, and has begun small-scale testing.
Eight minutes later, Yang Mingxia, carrying soy milk, was the sixth person to enter the office.
Seeing this, Li Xiaoyue quickly waved to Yang Mingxia: "Boss, boss! Renren.com has made an official announcement, they're going to hold a press conference!"
'
"Hmm, they're holding a press conference, why are you so excited?" Yang Mingxia put the soy milk on the table and curiously approached Li Xiaoyue's computer.
"No, they're holding a press conference to officially announce an app called [Private]. I just downloaded an installation package from one of their private channels and found it's exactly the same as our Momo!" Li Xiaoyue quickly explained.
Yang Mingxia frowned, then quickly picked up Li Xiaoyue's phone and started trying it out.
1 minute later.
"Damn it, this is pixel-perfect plagiarism! Except for the tab names, everything else is exactly the same as the old version of Momo! Renren.com is shameless!!" Yang Mingxia was furious.
"Boss, I just tried it out, and their chat function is pretty basic. It can't compare to Momo," Li Xiaoyue said.
"No, Renren.com will soon have over 100 million users, and more than 60% of them are college students. Their social networks are very strong. If we redirect all of their users to Renren.com, it will pose a great threat to Momo."
As Yang Mingxia spoke, she walked toward Tang Yan's workstation.
At the same time, the long-absent greeting of "Good morning, boss lady" rang out in the office.
For some time now, Gu Wanning has been busy with investments at Kik and other work at the law firm, and hasn't been to Mingfan Technology for over a month.
In the CEO's office.
Geng Zhi was gazing out the window, his heart filled with longing for someone far away.
Suddenly, a pair of warm hands reached out from behind and gently covered his eyes.
Geng Zhi was startled, then a smile appeared on his lips. He stretched his arms behind him, squatted down slightly, and with a sudden burst of strength, he lifted the person behind him onto his back.
Caught off guard, Gu Wanning was startled and let out a sharp "Ah!" before instinctively wrapping her arms around his neck.
Yang Mingxia and Tang Yan, who had just reached the CEO's office door and were about to knock to report Renren.com's plagiarism, happened to see this scene and exclaimed "Ah!" in response.
The two then quietly closed the office door and slipped out without a sound.
"It's not closed yet!" Gu Wanning quickly got off Geng Zhi's back, glared at him reproachfully, her cheeks still flushed, but her tone was full of tenderness.
Geng Zhi turned around, grabbed her hand, his eyes filled with tenderness and joy: "When did you come back to China? Why didn't you let me pick you up?"
"Hehe, I just wanted to give you a surprise." Gu Wanning said with a smile, taking out a black square box from her bag and handing it to him.
"Here, this is a gift for you."
Just as Geng Zhi was about to open it, Gu Wan Ning pressed his hand down: "You're not allowed to open it now. Open it when you get home."
"it is good."
Geng took the box directly and carefully placed it on the table, then tenderly touched her cheek: "Your face has gotten so thin. You've worked so hard these past few days. It's really not easy working for someone else."
"It's not hard work," Gu Wanning said, then suddenly remembered the important matter and hurriedly said, "By the way, you big liar, I've invited a high-ranking official from the Ministry of Industry and Information Technology to attend your university's seminar on the [Personal Information Protection Law]."
"Huh?" Geng Zhi was surprised. "We were just talking about this last night, and you've already invited him today??"
'
"Hehe, I asked Luo Yanling for help; her family has a lot of connections."
"To be able to get a high-ranking position so quickly, what kind of background must Luo Yanling have?" Geng Zhi muttered to himself.
After cuddling for two minutes, Gu Wanning finally said, "Does President Tang and Mingxia have something to discuss? Should I go and call them in?"
"Great, now that you're back, let's call them together and officially launch the [WeChat] project."
T