Yuan Jing's face turned pale. Investing in this business is his profession, he took out his calculator and quickly calculated Chu Yuanxi's specific plan. At the same time, he quickly asked: "What if you continue to raise funds later?"

"Simple, if there is financing later, the net profit required by the VAM can be calculated according to the weight of the actual net profit in Series A financing. ”

Assuming that the A round is valued at 1 billion, all of which belong to the founding team including the employee stock ownership platform, with a total of 10 million shares, 200 million raised and 2 million shares, and the total valuation after the A round is 1.2 billion, and investors account for 1/6 of the shares.

Let's look at the simplest model first, assuming that there will be no financing later, Chu Yuanxi's requirement is that if the net profit in the first year reaches 333 million, the investor will give 1.0525 million shares to the founding team, and only 947,500 shares will be left, and the investor's shareholding ratio will drop to 7.9%, and the founding team's shareholding will become more than 11.05 million shares. However, the company was revaluated by 20 times the net profit, and the value of this part of the investor's shares was 525 million yuan, a surge of 325 million yuan.

At this time, the valuation of Baren Entertainment is already 6.66 billion, which is the scale of A-share listed companies, and it can even step on half of the listed companies in the bear market. If the Ba people can be listed, the valuation will become market value, and the total number will have to rise, because there are few cultural and creative companies on the open market that are 20 times cheaper, and the profit of more than 300 million a year will definitely meet the financial indicators for listing.

If the net profit in the first two years reached a total of 1 billion, the investors gave a total of 1.25 million shares to the entrepreneurial team, and the remaining 750,000 shares were still valued at 625 million yuan at a price-earnings ratio of 20 times.

In the first three years, the net profit reached a total of 2.666 billion yuan, and the investors gave a total of 1.47 million shares to the entrepreneurial team, and the remaining 530,000 shares were valued at 785 million yuan.

In other words, if any of the three conditions are fulfilled, the investor's shareholding will fall sharply, but the net value will increase dramatically, because the total value of the company will increase rapidly.

This expansion is called a gamble, and it is actually an incentive.

As a financial investment, this plan is very reasonable, but for venture capital, it is a harmonious word!

In the third year, if the company just completes the gambling and has a net profit of 900 million yuan a year, investors assume that they can sell the shares at a valuation of 17.8 billion yuan at 20 times the price-earnings ratio, then invest 200 million yuan and make 580 million yuan in three years, with a return rate of nearly 100% per year. The problem is that the risk is also huge! I have never heard of a 3 times return on the A round of investment in a start-up, and 30 times is about the same!

Yuan Jing would like to ask Chu Yuanxi, can you tell the difference between VC investment and PE investment?

At the same time, he also wants to ask if the bet you mentioned is serious? What is the concept of a three-year net profit of 2.7 billion, do you know? How many star white horse stocks listed on the A-share market are held by the fund, and there is no net profit of 2.7 billion yuan for three years? Do you know what is the net profit of the three super white horses in the past three years, Foshan Lighting, Xinhecheng and Yunnan Baiyao, and the high-quality assets in the A-share market?

In fact, he can also be Chu Yuanxi's proposed bet does not exist, because it seems impossible to complete it at a glance. He has read a lot of VAM agreements for Series A financing, and he has never seen a requirement for profits in his memory, and investors will be considered bullying or ignorant if they ask for such a request. Chu Yuanxi is good......

At this time, Yuan Jing finally understood why Chu Yuanxi asked them to take out as much as two or three hundred million in the A round. This has its own logic, and there is no more to lose, when investors bet on it......

In the open market, stocks that can earn 300% in three years are rare even in a bull market, and they require very superb investment skills and research skills, or very superb news channels......

Chu Yuanxi saw Yuan Jing's face and decided to cheer him up: "It's more unpleasant to just look at the first three years, but my goal is to make a valuation of 100 billion, the first three years are just the beginning, and there is no need to continue to reduce your shareholding ratio in the future." ”

"The market value of China Literature Group is only more than 500 billion......

"Ah, you're right, China Literature Group is mature and steady, not as radical as me. We are not a typical cultural and creative enterprise, and Baren Entertainment has always broken the convention. ”

Yuan Jing really wanted to say: My surname is broken, and the double name is conventional, how about you beat me? Douyin is already a national-level application, and it is popular in half of Asia when it goes abroad, with a valuation of only 10 billion dollars, and there is no valuation of 100 billion, where can you find a valuation of 100 billion?

At this time, he was not angry, neither angry, nor annoyed, let alone anxious, and became a lot more Buddha-like, but was more interested in how the brain groove that Chu Yuanxi used to brag about was long: "Then how do you plan to achieve this 100 billion valuation? Also, how much benefit do you expect to achieve when you achieve a 100 billion valuation?"

"You are actually not in the early days, although it looks early, but it is on the basis of a billion to start investing, you can't use venture capital to think about it, let alone always think of it as a A round, you can see it as a B round or C round. ”

Chu Yuanxi replied with an oath: "How can I achieve a valuation of 100 billion, this matter is not yet the time to talk about it." Assuming that only this round of capital is financed and a valuation of 100 billion yuan is achieved on this basis, you will roughly achieve a net record of six or seven billion, more than 30 times the income. Many angel investments can achieve hundreds of times the return, that is because the investment is small, and the 30 times return of hundreds of millions of investment is already good. ”

"Sounds like a lot, but why are you so keen on betting? Judging from the financing ratio you designed, the founding team would have taken enough without betting, right?"

"Because there may be financing later. What I can't accept is that the company is growing very well, but the founding team's holdings continue to decline. Chu Yuanxi found that it was much more difficult to persuade Yuan Jing than he imagined.

After thinking about it for a while, he suddenly thought that the reason why the well-off in the original world adopted a similar plan, and there was no problem, and even the plan was proposed by Yuan Jing himself, was because he held a small shareholding...... In the original world, he only held so much represented by the founder's personal valuation from the beginning, and a little more than 10% was still a sufficient overestimation of his value, and it was Zheng De who took the lion's share.

The reason why it does not mean that he works for Zhengde Fund is because Yuan Jing handed over the voting rights to him by agreement, but he does have few shares. Then, through gambling and incentives along the way, Zheng De's equity was continuously diluted after multiple financings, and his own shareholding ratio increased slightly.

But Zheng De was very happy in this way, the equity declined slowly but the stock price rose rapidly, and he made a lot of money overall. Moreover, Xiaokang needs Zheng De's cooperation every time he raises money, because even if the voting rights are handed over, the company's daily operation has nothing to do with Zheng De, but the priority of financing must be guaranteed, and Zheng De will not be able to successfully finance if he does not let go.

And now in the plan he proposed, the founding team takes the absolute majority, and Zheng De can only take part of the 200 million, becoming the weaker side, so it may seem difficult to accept psychologically.

But it won't work if you don't cut it, because, assuming that the founder accounts for 80% of the shares after the A round, the company is valued at 100 million after 20 million, and the development round, the B round is valued at 400 million, and then 100 million, the founder will have 64% of the equity left, and the C round will be valued at 2 billion, 500 million, and the remaining 51.2% is barely strong, what should I do after the C round?

The full name of VAM is actually called "valuation adjustment agreement", which is signed based on the expectation of performance growth. Under a healthy financing model, the founder team must replenish its own blood in each round in order to stabilize the shareholding ratio, and the way is to gamble.