booktalesy Chapter 253 Each Has Their Own Calculations
Chapter 253 Each Has Their Own Calculations
Chapter 253 Each Has Their Own Calculations
That afternoon, news that Ernst planned to transfer his personal shares in Leap Games and cash out $5.5 million spread like wildfire through the media, and then the whole of America knew about it.
The media, as if injected with adrenaline, reported on the matter one after another, leaving the general public, industry professionals, and even seasoned investors across the United States stunned. Many people rubbed their eyes and repeatedly checked the news content, wondering if they had misread the numbers.
Wall Street has gone mad again.
The media were all stunned. Why did they all add the word "again" without prior agreement?
While Wall Street was in an uproar, Silicon Valley tech companies were full of grievances and even a bit of sour grapes.
Why should I?
When our company was raising funds, those Wall Street investors were like misers, asking all sorts of questions and driving the valuation down to rock bottom, practically wanting us to give away shares for free.
How come when it came to Ernst, he just pulled out $5.5 million without even batting an eye?
The general public was completely dumbfounded and wanted to ask Ernst: What kind of family do you come from? It seems like Wall Street is owned by your relatives!
On what grounds?
Before YueDong Games even had an IPO, Ernst had already cashed out two large sums of money. This kind of treatment is practically like being treated like a godfather in the capital circle. Calling him a godfather would be an insult.
How much has he cashed out so far? First, there was the Boston consortium's $3.2 million, and now Wall Street's $5.5 million. That adds up to $8.7 million, right? And each valuation is more exaggerated than the last.
Even if the company goes bankrupt now, he'll still be making a fortune.
Some even suggested that Ernst open a wealth secrets training course, saying, "I don't need you to teach me how to make money, just teach me how to be a father to Wall Street."
As the discussion heated up, the topic was once again pushed to the forefront: how much money does Ernst actually have?
How many shares of each company does he still hold?
At the age of 25, he created wealth that others couldn't accumulate in 250 years, which made a group of entrepreneurs curse him. Then, a group of people joined the entrepreneurial army, wanting to become the next Ernst Garfield.
While the outside world was in an uproar, a completely different scene unfolded at the headquarters of YueDong Games.
Ernst was sitting in his office, methodically reviewing the progress reports and future plans for the company's various recent projects.
The development of a sequel to Call of Duty has been confirmed, research on new game IPs has been conducted, and plans for expansion in overseas markets have been made. Ryan Ruiz turned off the TV in his office, looked up at Ernst, and said with a serious tone, "Should we check this out?"
Ernst was taken aback for a moment when he heard this, then realized that the other party was talking about investigating internal spies and finding out who had leaked the information.
He put down the work report in his hand, leaned back in his chair, and shook his head with a smile. "No need, this may not necessarily be information leaked from within our organization."
Ryan Ruiz was puzzled. "But the news spread so fast. It was almost completely out in less than two hours after the institutional shareholders left the company. How could it have happened so quickly if no one leaked it?"
Ernst nodded in agreement, acknowledging the other's analysis was reasonable. "But have you considered that if we had an insider selling information, it should be an exclusive story? Which media outlet would get such information and treat it as an exclusive, keeping it under tight control? How could we let all the media know the details?"
Ernst picked up the coffee on the table, took a slow sip, and after putting down the cup, said leisurely, "Don't forget, among our shareholders, there are also poor people."
"Poor people?" Ryan Ruiz's eyes widened suddenly, and he instantly realized who Ernst was referring to. "You mean Silicon Valley investment funds?"
It's clear to everyone that Silicon Valley investment funds are not capable of participating much in this share transfer. At most, they can only contribute a small portion of their funds to symbolically dabble in the profits, and they can't possibly take a large slice of the pie.
But Ryan Ruiz still had some doubts: "Even if the information was leaked by Silicon Valley investment funds, what is their purpose? What benefit would they gain from doing this?"
In his view, YueDong Games is a gold mine. The explosive success of Call of Duty has once again proven the company's development potential. As long as the IPO is successful, it will surely bring rich returns to investors.
Those institutional shareholders should have kept the news tightly under wraps, fearing that it would attract other investment institutions to share the pie. Why would they actively leak the news? Isn't this like inviting a wolf into the house and giving away the gold they've already got their hands on?
Ernst did not answer immediately, but turned to look out the window.
The office's floor-to-ceiling windows face San Jose's main street, and not far away is a construction site where a modern office building is about to rise, symbolizing the innovation and vitality of the area.
Turning his gaze away, he slowly spoke, "The purpose? Of course, it's to attract more funds."
That's exactly what Sequoia Capital was planning.
At this moment, in his office at Sequoia Capital headquarters, Michael Moritz was looking at the media reports filling his computer screen, and couldn't help but smile with satisfaction.
He held a glass of top-quality red wine, gently swirling it, and said to Doug Leone sitting opposite him, "You see, the results are even better than we expected. I believe it won't be long before various capital firms in Silicon Valley come knocking on our door, and then we'll be able to dominate this battle for control of the shares."
Doug Leone also wore a smug smile, because this brilliant plan was his own idea.
After Michael Moritz returned from Jump Games, the two met immediately and went over the situation in detail.
Although Sequoia Capital is no longer able to provide a large amount of capital to participate in this share transfer, it does not mean that they are willing to give up the opportunity to profit.
After all, the potential of YueDong Games is undeniable. If they miss this opportunity, it will be virtually impossible to acquire shares again in the future.
"Your idea is better," Michael Moritz said, taking a sip of red wine with a hint of approval in his voice.
"That's our advantage. Although Wall Street institutions are wealthy and powerful, they are too far removed from Silicon Valley, their understanding of technology companies is not as deep as ours, and the decision-making processes of large companies are too cumbersome and inflexible."
"If Wall Street institutions had made a decision on the spot and directly bought up the shares Ernst transferred, we would have been helpless. But now that there is a grace period, the situation is completely different."
Ernst gave institutional shareholders one night to consider whether to participate in the share transfer.
It was this seemingly insignificant night that gave Sequoia Capital the opportunity to take advantage of the situation.
Silicon Valley investment funds may not be as powerful as Wall Street institutions, but if they can unite, the total amount of funds they can raise should not be underestimated.
The leak was done to let these investment funds know that there were shares available for purchase in YueDong Games.
Doug Leone leaned back confidently in his chair, his arms crossed over his chest. "This time, I'm going to use Dynamic Games to completely change the image of Silicon Valley investment firms."
In the past, when people mentioned Silicon Valley capital, their first impression was that it only invested in startups and had limited funds.
Therefore, even startups that are slightly larger are more willing to cooperate with Wall Street when they have Wall Street capital to choose from, since Wall Street has more abundant funds and can provide more resources.
However, if Silicon Valley Investment Fund can acquire the shares transferred by Ernst and become the largest institutional shareholder of YueDong Games, then when the company goes public (IPO), Silicon Valley Investment Fund's name will appear in the most prominent position in the prospectus.
This naturally allows them to expand their influence, letting the entire American capital community know that Silicon Valley capital can not only invest in startups, but also participate in large-scale investments, and even dominate the capital operations of large companies.
Michael Moritz suddenly remembered something, and a broad smile appeared on his face. "This time we've gotten our revenge for last time. I bet Henry Paulson of Goldman Sachs is cursing in his office right now, isn't he?"
In the last round of financing for YueDong Games, Goldman Sachs tricked everyone, and the two still remember this grudge.
This time, Ernst released shares again, thwarting the plans of Goldman Sachs and two other Wall Street institutions who originally wanted to monopolize the shares, which can be considered a small revenge.
As he laughed, Michael Moritz suddenly seemed to realize something. His smile vanished instantly, his eyes narrowed slightly, and his tone became uncertain. "You mean—we haven't fallen for Ernst's trick, have we?"
"You fell for his trick?" Doug Leone paused, then asked, puzzled, "How so?"
"What if he anticipated we would do this, deliberately giving us the opportunity to leak the information, with the aim of using us to spread the news, attract more capital, and drive up the share price?"
According to the rules, if Ernst wants to transfer shares, he must first consult the existing shareholders. Only if the existing shareholders all express no interest can he look for external buyers.
But now that the news has spread, external buyers are taking the initiative to come to him. Even if he raises the valuation, it won't be because he's dishonest, but because that's how the market works.
"Really?" Doug Leone hesitated. "He's only 25. Could he really be that cunning?"
In his view, although Ernst was very talented in business, he was still young and unlikely to outsmart these old foxes who had been navigating the capital world for more than a decade.
Michael Moritz thought about it more and more likely: "Otherwise, why would he have given me another night?"
Don't underestimate the power of a single night; it can change a lot of things.
For example, new capital may enter the market, or someone may offer a higher price.
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