A 0.25 micron production line costs a high price of $700 million, and it is unrealistic and unrealistic for an individual to pay for this money.

There are multiple capitals behind any chip foundry. Even Huaguo Shougang claimed to invest $10 billion to build a chip manufacturing plant in Yanjing, with an initial investment of $1.335 billion.

OF THE $1.335 BILLION, $120 MILLION WAS CONTRIBUTED BY SHOUGANG COMPANIES, AND THE OTHER TWO AMERICAN SEMICONDUCTOR COMPANIES EACH CONTRIBUTED $100 MILLION EACH, AOS SEMICONDUCTOR AND BVI DEBORAH SEMICONDUCTOR. Another $45 million was invested by Yanjing's state-owned asset management company, and the rest of the money was borrowed from a bank.

This is a matter of risk control, but also a matter of profit distribution, you can only get orders from other companies if you distribute the benefits to other companies.

It is entirely up to Zhou Xin to pay this money personally, and he can afford it, but it will lead to invisible difficulties in the follow-up operation, and others will not find you to do OEM.

Now there are so many companies doing chip foundry, why not choose the company I have invested in, and choose a sole proprietorship enterprise like Xinxin Technology? Zhou Xin has a natural aura in the Internet field, but does not have this aura in the chip field.

And even if there is a halo, the halo will not let other companies hand over the orders of chip foundry to him, and no one thinks about the problem out of emotion when it comes to interests.

Why TSMC was able to get Intel's order, because more than eighty percent of TSMC's shares are held by Wall Street, and Citigroup holds more than 20% of TSMC's shares. This has also led to TSMC's decision-making level almost all crooked, and the board seats are basically crooked, but they can't refuse the request from Ameriken.

Hu Zhengming, like Zhou Xin, initially pinned his hopes on SMIC, but later abandoned the idea after carefully understanding SMIC's shareholding structure and the specifics of its internal management.

Rather than cooperating with SMIC, it is better to build their own factory, Xinxin Technology pays a small amount of money, and other companies pay a large amount, according to his plan, Xinxin Technology will invest 20%, and 2 billion US dollars will be able to leverage the investment scale of 10 billion US dollars.

As for the fact that Chinese enterprises cannot get the latest production technology, this is not a problem, because if they aim at the Chinese market rather than the foreign market from the beginning, then the backward production line is not only not a problem, but an advantage.

Hua Hong Semiconductor, SMIC, and Shougang Semiconductor will only consider 8-inch, 0.25-micron production lines when building factories. They also wanted to import a 12-inch, or 0.18 micron line, but this line was banned.

For Ameriken, they don't want to cultivate another competitor in the chip space.

Ameriken's internal interests are certainly not monolithic, and the chip equipment production companies do not mind that the competition of chip foundries is more fierce, and their equipment is easy to sell. However, for Ameriken's overall strategic considerations, they do not want Huaguo to become an important player in the field of chip foundry.

From the very beginning of guided missiles, strategists in Washington have realized that chips and military capabilities are closely linked, even highly correlated. Therefore, from a commercial point of view, Huaguo can get the equipment for chip production, and from a strategic point of view, these equipment and technologies are at least one generation behind.

Of course, Neon and Ameriken have different ideas, they have lost their original position in the field of chip manufacturing, and the market share of NEC, Toshiba, Hitachi, Fujitsu and Panasonic, which dominated in the 80s, has been continuously squeezed by Samsung and TSMC.

Neon is retreating from manufacturing in the field of chips to becoming a supplier of raw materials and equipment, so they don't mind cooperating with Huaguo. Like NEC, it even hopes to make a comeback through the vast market of Huaguo.

So on the contrary, neon manufacturers want to break free from the shackles of the Wassenaar agreement.

In the 80s, Neon's chip industry accounted for half of the entire chip industry, accounting for 45% of the world's semiconductor market. Until the early 90s, 6 of the top 10 semiconductor companies were still from Neon. In 1994, Sony's global color TV shipments reached 100 million units, which is a staggering number.

Matrix is still a long way from Sony's pinnacle in consumer electronics. In the 80s, neon's memory chips, also known as DRAM, crumbled Ameriken companies, and more than eighty percent of Americon DRAM companies went bankrupt.

In 1980, the Neon Electronics & Machinery Industry Association held a seminar in Washington to promote the DRAM produced by Neon, and the representative of Hewlett-Packard praised the DRAM produced by Neon, which caused a strong shock in the semiconductor industry at Ameriken. So much so that the editor of the Ameriken technology magazine "Electronics" was incompetent and furious:

"Neon Semiconductor has come to teach Americon how to manage quality, and Americon representatives have personally proved that they are right!"

Of course, later Ameriken interfered in the operation of Neon's semiconductor companies on the grounds of national security, which is another story.

Hu Zhengming is almost familiar with this history, and he knows many frustrated neon engineers at the annual IEEE conference, who often recall the neon semiconductors of the '80s, which were so bright that reality dragged them back to alcohol.

Therefore, Hu Zhengming does not dislike the 8-inch production line, in his opinion, the 8-inch production line has been able to do a lot of things.

It is not wrong for an 8-inch production line to produce 0.25 micron chips, but through the optimization of process, structure and function, it is theoretically possible to achieve 0.13 microns, which is even lower than the 0.18 microns of 12 inches.

As for why you insist on choosing Huahong, it is because Huahong's 8-inch production line is still in the hands of Huahong itself, not in the hands of Huahong NEC, and Huahong is considering partners.

Of course, Xinxin Technology is a good partner to work with, no matter from which aspect, Zhou Xin behind Xinxin Technology is an excellent partner. Matrix, a consumer electronics company with strong potential, has a strong presence in Silicon Valley, huge cash flow, and a good relationship with senior executives in China.

There is a natural basis for cooperation.

Unlike Shougang's 8-inch production line that is still in planning, but the preliminary planning work has been completed, Huahong's 8-inch production line will be put into use.

If there is no new chip technology, Huahong's 8-inch production line will be allocated to Huahong (Ameriken) company.

Hu Zhengming hopes to build this production line into a model project, and then attract more Chinese capital or international capital to join in.

This cooperation model can always be adopted in the future, so the most important goal at the moment is to convince Huahong.

And the mechanism of control, that is, different rights of the same shares, should be written into the contract.

Whether it is Hu Zhengming or Zhou Xin, they don't want to make the crucial point of control as simple as verbal constraints. They allowed Huahong to do this, so is the follow-up chip production line jointly developed by Xinxin Technology and other companies only a verbal constraint?

Jiang Shoulei said that the control of Huahong NEC is in the hands of NEC, and the middle-level managers are almost all neon people, and this control is only temporary, and in May 03, Huahong will take back the entrusted management right from NEC.

Hu Zhengming doesn't know what the future holds, but from experience, contract constraints are the safest means.

"The big reason why Xinxin Technology is obsessed with control is that we believe that there may be a big difference between Huahong and Xinxin Technology in terms of future business strategies.

In the contract, we will ensure that the annual revenue is not less than 2 billion RMB, and we prefer to invest these revenues in research and development. Then we want to tilt the compensation package towards front-line employees and R&D personnel.

Then we will invest the funds in some of our upstream and downstream domestic suppliers, we will not be in a hurry to pay large dividends, of course, the dividends themselves will definitely be done, but the matter itself will not be so fast.

Therefore, we do not want to do it after reaching an agreement with Huahong on these things in the future, which will seriously affect the efficiency of business operations. Hua Hong can supervise where each payment goes.

Huahong has the right to supervise, the newly established company can be audited by Huahong every year, and the capital exchange can be connected to the capital control system of UnionPay. ”

After Hu Zhengming finished speaking, Jiang Shoulei was fully willing to cooperate with Xinxin Technology from the perspective of a semiconductor practitioner.

Under the premise of the recession of the entire semiconductor industry, except for Xinxin Technology, no company can write guaranteed revenue into the contract terms.

Although there is a time limit, the time limit for revenue guarantee in the contract is five years, 2 billion RMB a year, and the gross profit margin is guaranteed to be not less than 30%. In other words, Xinxin Technology cannot use a low-price strategy to ensure revenue.

Five years is long enough, you must know that the chip production line has to depreciate the equipment every year, and the chip production line purchased for 700 million US dollars will complete the full value depreciation of the equipment in about five to seven years. In other words, in terms of company assets, the book value of the production line, which was actually purchased at a cost of $700 million, will be zero.

If the joint venture between Xinxin Technology and Huahong completes the depreciation of the production line in five years, then the cost of the chips produced by the subsequent production line is only labor and material costs.

In chip foundry enterprises, the majority of the cost is equipment depreciation. This is also why TSMC's profit margin is as high as 60%, while the profit margin of other domestic chip manufacturers is at most 30%. It is because TSMC's low-end production lines have completed the depreciation of production equipment, and there is no cost of depreciation of equipment value.

Most of the production equipment of other domestic chip manufacturers was launched in 19.

Moreover, the majority of TSMC's revenue comes from low-end chip foundries, and high-end chip foundries only account for a small part, and even in the 3nm era, almost only mobile phone manufacturers can afford TSMC's 3nm chips.

Therefore, no matter from which point of view, the conditions of Xinxin Technology are too superior.

Jiang Shoulei sighed: "Professor Hu, I am personally very willing to cooperate with Xinxin Technology, and I will try my best to promote this matter."

But this is not something that I can say at my level, it is more of a political issue than an economic one.

At the economic level, to be honest, Huaguo's investment in the field of chips is not a small number of losses on a national basis.

The conditions given by Xinxin Technology have been decided, Huahong's 8-inch production line will at least not lose money, and in the current environment of the chip industry, it is very rare to be able not to lose money.

This is a completely new way, whether it is a joint venture with a private enterprise, or a way of weighted voting rights, and I am not sure whether Huahong will be allowed to become a pilot above. ”

Hu Zhengming reacted quickly: "Mr. Jiang, you can see it as Huahong's venture capital in Xinxin Technology.

It's just that this venture capital, Huahong invests not in money, but in a production line, but it is still a venture capital in essence. The revenue and gross profit margin guaranteed by Xinxin Technology are the agreement before Xinxin Technology accepts this venture investment.

Do you know NewPay? ”

Jiang Shoulei nodded: "I know, NewPay also has some business in China, and they are very active in the foreign trade industry in the Yangtze River Delta region." I know some professors from Fudan School of Economics, and they have a very high opinion of NewPay, believing that NewPay has created a new economic model. ”

Hu Zhengming continued: "Yes, NewPay has received investments from Citigroup, Wells Fargo, JPMorgan Chase, Goldman Sachs and other institutions, all of which have adopted a weighted voting rights structure.

The voting rights of their equity and Zhou Xin's equity are 1 to 10.

Therefore, if you look at this as venture capital, there is nothing special, Huaguo has ambitions in the field of chips, hoping to occupy a place in the field of chips, but the high investment from the government has not achieved the desired results, I think it is time to change the way of investment.

Taking the cooperation between Xinxin and Huahong as a pilot is also in line with the spirit of Shenhai and Zhangjiang in the field of innovation. ”

The WVR model is new in Silicon Valley, because Google is nowhere near as successful as it was in the original space, and it would even take Wall Street to push for a merger with Baidu to get where it should be. So until 2001, the A/B share structure didn't catch on in Silicon Valley.

When entrepreneurs propose to adopt an A/B share structure, investment institutions will ask: Are you Newman?

When Huaguo really began to have the concept of weighted voting rights, it should not be until 2013, when the "Guiding Opinions on Carrying out the Pilot Program of Preferred Shares" was promulgated.

When the domestic capital market accepts the A/B share structure, it will not be until the promulgation of the listing rules of the Science and Technology Innovation Board that Article 2.1.4 clearly stipulates that different shares can have different voting rights.

And the reason why Jiang Shoulei is very excited about cooperating with Xinxin, he wants to promote this matter. The 8-inch production line is far from creating an annual revenue of 2 billion RMB, let alone so much every year for five years of stability.

He did not dare and could not agree because in 1995, the state-owned assets management department had a clear regulation: "It is not allowed to approve and approve the plan of adopting different rights and different interests for state shares, state-owned legal person shares and individual shares." ”

After Jiang Shoulei and Hu Zhengming finished chatting, Hu Zhengming did not limit this matter to his own level, he knew that when it comes to model innovation, a higher-level impetus is needed, and Zhou Xin needs to make efforts at this time.

Zhou Xin was not polite, first made an appointment with Director Zeng by email, and then went to Yanjing specifically for this matter to talk to Director Zeng face-to-face.

After Zhou Xin's detailed explanation, the other party said: "I think we can use Huahong and Xinxin Technology as a pilot, the system is dead, and people are alive, since neither the 908 project nor the 909 project has achieved the expected effect before."

Even far from our expectations, not to mention cultivating a group of chip companies, even the companies we invested heavily in have survived so hard, it's time to make changes. The conditions offered by Xinxin Technology are also very superior.

I agree with this matter in principle, and I will even vigorously promote the approval of this matter.

But I advocate that there should be process compliance, because just now Zhou Xin, you also told me that we are exploring model innovation, since it is model innovation, then the cooperation between Xinxin and Huahong will establish a sample for the subsequent cooperation between state-owned enterprises and private enterprises.

Then we have to do the model from the beginning of the process beforehand.

In my opinion, the following principles need to be followed: there must be sufficient argumentation in advance, since the operation of WVR is to be operated, then it is necessary to carry out accurate investment argumentation, and there must be sufficient evidence to prove that WVR is more valuable than WVR in this project.

This value is mainly reflected in two aspects: one is the value of obtaining project opportunities, simply put, if you do not implement weighted voting rights, it is impossible to obtain this investment opportunity, and naturally there will be no investment income and strategic value; Second, the economic benefits obtained after weighted voting rights can meet the normal level of return of general investment behavior.

The second is to do a good job of decision-making compliance. Strictly follow the investment decision-making process of state-owned enterprises, and keep all kinds of decision-making materials and decision-making meeting minutes in the process, so as to withstand the test of auditing;

The third is to insist on openness and transparency. Weighted voting rights are not prohibited by law, so there is no need to conceal them, and they should be boldly written into investment agreements, project cooperation agreements, articles of association and other documents, and do not engage in any drawer agreements.

Fourth, we should insist on fairness and justice. Regardless of whether the state-owned party waives part of the voting rights or dividend rights, or the partner waives it, the principle of consistency of rights and responsibilities must be adhered to, that is, the shareholder responsibilities corresponding to the waiver of part of the rights should also be exempted accordingly.

This is my personal initial idea and I will push this thing as soon as possible because there is only a small part of what I can think of and there will definitely be something missing.

We will formulate relevant notices and guidance as soon as possible, and then the cooperation between Huahong and Xinxin Technology can be followed by the guidance first.

We will continue to pay attention to this case in the future, and then adjust the policies we will introduce at the end, so as to do a good job in model innovation in the real sense. ”

Model innovation is very important, in my opinion, our current way of investing in large chip funds can only achieve catch-up, and it is difficult to achieve innovation.

And then tomorrow morning there will be

(End of chapter)