Chapter 20: Investing in Cisco
After the media hyped up the news about Phoenix Investment Group and Tang Bao for a period of time, it gradually returned to calm, and Tang Bao was able to breathe a sigh of relief.
Columbia University Library.
At the desk, Tang Bao skillfully turned the signature pen in his hand, contemplating his eyebrows and thinking about something. Regarding the matter of investing in Cisco Systems, Tang Bao really delegated power to Kaps, he did not ask the other party even the slightest, and really went with the flow. It's not that Tang Bao doesn't look down on Cisco Systems, it's just that now he is on the cusp of the storm, and his every move will attract attention. Not only Wall Street colleagues, journalists, but perhaps even government agencies in the United States are very interested in Tang Bao's behavior!
Phoenix Investment Group is a normal private company, but Tang Bao's nationality and family background have forced the US authorities to pay the necessary attention.
on this.
Tang Bao was an excellent business spy in his previous life, very sensitive, and he had already sensed that someone was secretly investigating the Phoenix Investment Group. He knows very well what the Americans think, although China and the United States were in the honeymoon period in the 80s, the United States has never relaxed its vigilance against China, they believe that Tang Bao cannot have so much wealth as a teenager, and they suspect that the Phoenix Investment Group has a background in the Chinese government and has ulterior motives for its activities in the United States.
At this sensitive point in time, Tang Bao became low-key at the right time, postponed some action plans, and soaked in the library to recharge his batteries every day in addition to serious classes.
Now.
He is a good student who studies hard!
Now, Cisco Systems is a very small company, but it's an information technology company. If Tang Bao is too enthusiastic, the relevant US departments may interpret it as the Chinese government's intention to acquire advanced American technology, which will lead to the intervention of government departments.
Fortunately.
At this time, the U.S. foreign investment scrutiny was not as strict as later generations, and the object of attention was not China, which was backward, but the surging Japanese capital.
In particular, Fujitsu's acquisition of Fairchild Semiconductor, a U.S.-based company with sensitive technology, has further added U.S. concerns about national security. As a direct result of the passage by the US Congress next year, the "Exxon-Florio Amendment" is essentially the core content of which is to authorize the president to take measures to suspend or prohibit any foreign acquisition, acquisition, or takeover of US companies engaged in interstate commerce that is deemed to threaten US national security. And next year, the United States will establish a special department to manage foreign investment, the Committee on Foreign Investment in the United States.
Arguably.
The main target of a series of actions by the United States is Japanese investors.
Tang Bao has also been in the United States for more than a year, and he has indeed deeply felt the worries and panic of Americans about the acquisition of American companies by foreign investors.
So.
The investment in Cisco Systems is indeed a sensitive high-tech field that the United States is concerned about, and Tang Bao doesn't want to have an accident halfway, so he can only keep a low profile. This is also something that cannot be helped, because during this time, some hateful newspaper media hyped up his red family background.
……
Silicon Valley, USA.
Afternoon, November 2, 1987.
Bosack sat down on the dilapidated sofa tiredly, threw away the document bag in his hand, and held his head in both hands, feeling very painful and helpless. His company was in trouble and wanted to bring in investment, but none of the venture capitalists were willing to pay for it, which made him very helpless.
Tuk-tuk.
There was a knock on the office door, and Bosak looked up in disbelief, who was going to come to his broken company. It was a clerk in his company who came in, and when he saw Bossak, he said excitedly: "BOSS, someone from a venture capital company has come to you and is waiting outside!" ”
"What? Venture capital firms? Are you sure? Bossak was stunned, his first reaction was impossible, and his second reaction was that it was definitely a dream. He and his wife have run dozens of venture capital firms, and none of them are willing to invest even a penny, how can there be venture capital who take the initiative to come to the door.
"Yes, I'm sure. Because Santi is talking to the other person, let you hurry over! ”
"Okay, okay, I'll go right away."
Bosak was stunned for a moment, glanced down at the clothes on his body, straightened his fluffy hairstyle a little, felt that it was okay, and ran out.
"You are?"
Seeing the visitor, Bosack felt a little familiar, but he couldn't remember where he had seen it.
"Hello, Mr. Bosak, we meet again. You're right, we've met once before. Capps said with a smile. However, I need to reintroduce myself, Kapus, head of venture capital at Phoenix Investment Group. ”
"Hello, please be seated."
After shaking hands with Kaps, Bossak made a gesture of please.
Capples smiled slightly, and sat down happily, he had already observed the furnishings in the office, and he had only one word - "broken".
"Mr. Cappus, you found our company, are you willing to invest in our Cisco Systems?" Posack asked eagerly.
Capus shook his head secretly, this wave of saks is really not business material, and he has not yet negotiated, so he is so eager, isn't it given to people to slaughter. Fortunately, he is really optimistic about Cisco's potential, and with the support of the well-funded Phoenix Investment Group, he will not be stingy with funds, and sincerely wants to help Cisco Systems develop and grow.
At this time.
Kapouls also understands why Bosak is having a hard time winning favor with venture capital firms. The other party may have superb technology, but he is obviously a rookie in terms of business management, and it is difficult for the venture capital company to give him the funds at ease, because no one wants to believe that he can run the company well, and the venture capital company does not want to let their money go down the drain.
Ponder for a moment.
Capps said slowly: "Yes, Cisco Systems is a very promising company, I wonder if Mr. Bosak is interested in accepting investment?" ”
"Yes, yes."
Bossak replied impatiently, and Santi next to him also waved her fist excitedly.
"According to our department's research on Cisco, it is a very promising Internet technology company, and it is valued at six million dollars. We're going to pay $4 million for a 65% stake in Cisco Systems, and we're not going to ask for it, you're still responsible for it. However, I think Dr. Bosak is a very good computer technology developer, and he should spend more time researching and developing better network technology to provide users with better network products. Perhaps it would be more perfect for Cisco Systems to hire a professional manager to take charge of the company's management and operations. Capps said with a smile.
Kapouse's words are tactful, but they are also very clear, you are an excellent technician, but you are not a business management material, so it is better to hire a professional.
Moment.
Bosak was in a tangle.
To be honest, he was very satisfied with the $6 million company valuation given by Capps and had no objections. But the sudden relinquishment of 65% of the equity means that the future Cisco Systems Company will not be controlled by the couple, and the other party also politely persuaded him to give up the management of Cisco.
In order to invest in Cisco's project, Capps even quit his job to change companies, and naturally had an in-depth understanding of the project, including the company's founders, Bosak and Santi. He is very aware of the business philosophy of Bossak and Santi for Cisco, to develop better technology and better network products to serve users.
"Trust me, Dr. Posack. Phoenix Investment Group's investment in Cisco Systems is not just for the sake of profit, we hope that Cisco can develop more advanced network products to serve users, and hope that Cisco will become a great company with our joint efforts! Cappus said sensationally.
But.
Cappuz's words speak to the hearts of Bossak and Sante, who founded Cisco not only to make money, but also to promote network technology products and serve the public. They are not entirely unacceptable to lose a controlling stake, but they fear that the loss of a controlling stake will make the company a profit-making tool for the capital company, which would defeat the purpose of which they founded Cisco.
"Dr. Bossak, a strategic investment company of Phoenix Investment Group, will never rush to promote Cisco's listing for short-term profits, so as to disrupt Cisco's business philosophy in the capital market. I very much hope that Cisco will become a great and world-class company with our support. Kapouls continued.
Listened to the words of Cappus.
Bosak nodded silently in approval, he understood that the investment of venture capital companies is to make profits by promoting the listing of the target company, and the other party can make a statement that he is not in a hurry to promote the company's listing, which really moved him very much, and he really felt the sincerity of Kappus.
Ultimately.
After a few minutes of discussion, Bossak and Santi agreed to Capuz's funding plan.
Phoenix Investment Group invested $4 million to acquire a 65 percent stake in Cisco Systems, with Bossak and Santi holding a 35 percent stake. Cisco established a board of directors, Phoenix Capital set up directors and representatives responsible for overseeing finances, and Cisco remained in charge of the Bossaks, but also said that they would respect the advice of Capps and find a suitable professional manager to take over the company.
Equally.
On behalf of Phoenix Investment Group, Kapoz also assured that it will not rush to push Cisco to go public, and will continue to inject capital or help the company obtain loans when the company is short of funds.
In general, both parties were very satisfied with the financing plan, and directly printed out the capital injection contract and signed it.
Call.
"Dr. Bosak, don't worry, the funds will be credited to the company's account within three days. I also wish us a happy cooperation! Kapus smiled and shook Bossak's hand.
……
Call.
It worked!
Tang Bao smiled and let go of the worries in his heart. When he heard that Capuz had paid $4 million for a 65 percent stake in Cisco Systems, he was almost stunned.
I laughed in my heart!