Chapter 268 - Fifty Percent of the Shares
Translator: Lav
Editor: Seliniaki Ilikia
Zhen Xu licked his lips and continued, “I wanted to split it with her, but she refused. She said that I developed this app by myself and she only helped me with the finances, so she doesn’t want any shares. It took a long time to persuade her to take ten percent.”
Shi Lei smiled. “There’s no need to go into the details of how much you love each other. Now, the first step. What percentage of shares are you willing to give this round?”
Zhen Xu didn’t hesitate. “Ten percent.” After a moment of thought, he became worried that Shi Lei was dissatisfied and added, “It’s the usual within the industry.”
Shi Lei nodded, as this was also what he had thought. It seemed like they didn’t need to speak further about this.
“Mr. Shi, can you tell me what the valuation of my company is?”
“Company…To be more accurate, it’s a valuation of your current project. After all, you have nothing else but a registration and legal personnel. Of course, my investment is targeted toward the company, so I need to state this before I do invest. Whether you have ideas of other projects or not, you can only use this investment on your current project. Of course, it may be used for company construction in the early stages.”
Zhen Xu nodded seriously. “After I received your call, I had already contacted two people who are willing to come and help me. I also contacted a new industrial suburb. The rent is cheap and we don’t need a big office at a moment. It’s enough if it can fit five or six people. The people from it said that they could deduct the water and electricity bills, as well as other fees like property management. They also have some preferential policies on taxing.”
“This is what you guys need to think about: How to deduct spendings so you have more money for the development of the product. I told you that I won’t intervene in your company’s operation, and in fact, none of the investors will. But your case is special because you don’t have a complete company, so that is why I’m taking extra care.”
Zhen Xu nodded again. His lips were still dry and he licked them again. “My girlfriend has already gone to the district for the rental. We can get it done with our own money. And I am willing to listen to what you said. I will definitely not use this investment on any other projects. In fact, I’m not scared of you laughing at me, but I don’t dare hope to have another project any time soon. It’s best for me to put all my attention and concentration on this project first.”
“Okay. Now I can answer your previous question. I spoke with my lawyer and her advice for you is that your company, or your project, has an ideal valuation between two to three million.”
Zhen Xu’s heart skipped a beat when he heard that. His ideal valuation was around 2.6 million, but he could accept it if it was lower, mainly because he had thought that he needed at least 250,000 yuan to successfully start working on everything.
“And personally, I’m willing to give you the highest valuation possible, so the number I’m giving you is three million.”
Zhen Xu was overjoyed. “No problem,” he replied without hesitation. “Honestly, this has already surpassed my expectations. I had assumed that I needed at least 250,000 yuan to start off, and a three million evaluation is more than enough.”
Shi Lei waved his hand. “Don’t be too happy yet. A three million evaluation means that ten percent of the shares is 300,000 yuan, but I won’t give you the 300,000 yuan in one go. If we can proceed smoothly into the signing contracts phase, then I will give you 100,000 yuan first and the remaining 200,000 yuan in two different deposits within the next three months. Do you have any questions regarding this?”
Zhen Xu froze. Of course he knew that there were installments no matter how much they decided on. After all, no one would know whether he would run away with the 300,000 yuan or spend it all or not. So the investors would usually pay in installments and pay the rest after confirming that the company was indeed operating and advancing.
But 100,000 yuan put Zhen Xu in a difficult position.
He only had about 50,000 yuan left and he didn’t plan on saving it. He had even given this to his girlfriend today to talk to the person in charge at the industrial district about renting the office. If everything went smoothly, then this 50,000 yuan would probably all be gone. Even the smallest office needed a few ten thousand yuan in rent. Zhen Xu thought about paying for half a year first, but the opposite party insisted that they could deduct the other fees, or even cut it all, but he had to pay the rent yearly. After all, the area Zhen Xu wanted was too small and the office he rented was already fully furnished and could be used straight after adding new equipment.
If Shi Lei only gave him 100,000 yuan for the first installment, half of it would be gone on office equipment, chairs, desks, computers, printers, and things as such. The remaining 50,000 yuan would be spent easily enough and he probably couldn’t even survive one month with it.
“Mr. Shi,” Zhen Xu began nervously, “can I ask when you plan to give me the second installment of 100,000 yuan? Or to be more accurate, how long after the first installment is settled?”
“After one month. And I won’t give you 100,000 yuan all in cash. I can provide necessary office equipment and make sure that everything is new. We can do this together, or I will do this under your supervision. Then I’ll give you the rest in cash.”
Zhen Xu didn’t have a problem with that. He could understand why Shi Lei was doing it. After all, they were just strangers and they needed to build more trust when things were associated with money.
Zhen Xu didn’t know that it was because Shi Lei needed to spend the monthly sum. Since the Black Card allowed him to buy office equipments with its money, of course he needed to maximize his own benefits as much as possible.”
“I’m afraid that one month is too long. According to my estimates, other than all the office equipment, we need more than 100,000 yuan for the first installment.” Zhen Xu grabbed the cup and took a big gulp of coffee. He plucked up his courage. “150,000 yuan for the first installment. Otherwise, it would be difficult for us to launch everything.”
Shi Lei was calculating silently in his head. He would only have 80,000 yuan of private funds left if he gave 150,000 yuan. It wasn’t impossible, but the more private funds he had, the more certainty he had in earning more money within a short period of time.
Perhaps Zhen Xu thought that Shi Lei was hesitating, so he also made a new decision.
“I know, you have your own worries. If you really won't agree, then I’m willing to give fifteen percent of shares. This way, your investment will raise to 450,000 yuan and it’s still a third. You can give me 150,000 yuan for the first installment.”
Shi Lei was blank for a second. He hadn’t expected Zhen Xu to be willing to give an extra five percent for the sake of 150,000 yuan in cash, which surprised him.
After a moment of thought, Shi Lei said, “I’ll discuss it with my lawyer.”
He immediately stood up, took the phone outside the cafe, and dialed Zhang Meimei.
He recounted the situation briefly and Zhang Meimei said, “That’s a good thing. I don’t see any problems with it.”
Chapter 268 - Fifty Percent of the Shares
Translator: Lav
Editor: Seliniaki Ilikia
Zhen Xu licked his lips and continued, “I wanted to split it with her, but she refused. She said that I developed this app by myself and she only helped me with the finances, so she doesn’t want any shares. It took a long time to persuade her to take ten percent.”
Shi Lei smiled. “There’s no need to go into the details of how much you love each other. Now, the first step. What percentage of shares are you willing to give this round?”
Zhen Xu didn’t hesitate. “Ten percent.” After a moment of thought, he became worried that Shi Lei was dissatisfied and added, “It’s the usual within the industry.”
Shi Lei nodded, as this was also what he had thought. It seemed like they didn’t need to speak further about this.
“Mr. Shi, can you tell me what the valuation of my company is?”
“Company…To be more accurate, it’s a valuation of your current project. After all, you have nothing else but a registration and legal personnel. Of course, my investment is targeted toward the company, so I need to state this before I do invest. Whether you have ideas of other projects or not, you can only use this investment on your current project. Of course, it may be used for company construction in the early stages.”
Zhen Xu nodded seriously. “After I received your call, I had already contacted two people who are willing to come and help me. I also contacted a new industrial suburb. The rent is cheap and we don’t need a big office at a moment. It’s enough if it can fit five or six people. The people from it said that they could deduct the water and electricity bills, as well as other fees like property management. They also have some preferential policies on taxing.”
“This is what you guys need to think about: How to deduct spendings so you have more money for the development of the product. I told you that I won’t intervene in your company’s operation, and in fact, none of the investors will. But your case is special because you don’t have a complete company, so that is why I’m taking extra care.”
Zhen Xu nodded again. His lips were still dry and he licked them again. “My girlfriend has already gone to the district for the rental. We can get it done with our own money. And I am willing to listen to what you said. I will definitely not use this investment on any other projects. In fact, I’m not scared of you laughing at me, but I don’t dare hope to have another project any time soon. It’s best for me to put all my attention and concentration on this project first.”
“Okay. Now I can answer your previous question. I spoke with my lawyer and her advice for you is that your company, or your project, has an ideal valuation between two to three million.”
Zhen Xu’s heart skipped a beat when he heard that. His ideal valuation was around 2.6 million, but he could accept it if it was lower, mainly because he had thought that he needed at least 250,000 yuan to successfully start working on everything.
“And personally, I’m willing to give you the highest valuation possible, so the number I’m giving you is three million.”
Zhen Xu was overjoyed. “No problem,” he replied without hesitation. “Honestly, this has already surpassed my expectations. I had assumed that I needed at least 250,000 yuan to start off, and a three million evaluation is more than enough.”
Shi Lei waved his hand. “Don’t be too happy yet. A three million evaluation means that ten percent of the shares is 300,000 yuan, but I won’t give you the 300,000 yuan in one go. If we can proceed smoothly into the signing contracts phase, then I will give you 100,000 yuan first and the remaining 200,000 yuan in two different deposits within the next three months. Do you have any questions regarding this?”
Zhen Xu froze. Of course he knew that there were installments no matter how much they decided on. After all, no one would know whether he would run away with the 300,000 yuan or spend it all or not. So the investors would usually pay in installments and pay the rest after confirming that the company was indeed operating and advancing.
But 100,000 yuan put Zhen Xu in a difficult position.
He only had about 50,000 yuan left and he didn’t plan on saving it. He had even given this to his girlfriend today to talk to the person in charge at the industrial district about renting the office. If everything went smoothly, then this 50,000 yuan would probably all be gone. Even the smallest office needed a few ten thousand yuan in rent. Zhen Xu thought about paying for half a year first, but the opposite party insisted that they could deduct the other fees, or even cut it all, but he had to pay the rent yearly. After all, the area Zhen Xu wanted was too small and the office he rented was already fully furnished and could be used straight after adding new equipment.
If Shi Lei only gave him 100,000 yuan for the first installment, half of it would be gone on office equipment, chairs, desks, computers, printers, and things as such. The remaining 50,000 yuan would be spent easily enough and he probably couldn’t even survive one month with it.
“Mr. Shi,” Zhen Xu began nervously, “can I ask when you plan to give me the second installment of 100,000 yuan? Or to be more accurate, how long after the first installment is settled?”
“After one month. And I won’t give you 100,000 yuan all in cash. I can provide necessary office equipment and make sure that everything is new. We can do this together, or I will do this under your supervision. Then I’ll give you the rest in cash.”
Zhen Xu didn’t have a problem with that. He could understand why Shi Lei was doing it. After all, they were just strangers and they needed to build more trust when things were associated with money.
Zhen Xu didn’t know that it was because Shi Lei needed to spend the monthly sum. Since the Black Card allowed him to buy office equipments with its money, of course he needed to maximize his own benefits as much as possible.”
“I’m afraid that one month is too long. According to my estimates, other than all the office equipment, we need more than 100,000 yuan for the first installment.” Zhen Xu grabbed the cup and took a big gulp of coffee. He plucked up his courage. “150,000 yuan for the first installment. Otherwise, it would be difficult for us to launch everything.”
Shi Lei was calculating silently in his head. He would only have 80,000 yuan of private funds left if he gave 150,000 yuan. It wasn’t impossible, but the more private funds he had, the more certainty he had in earning more money within a short period of time.
Perhaps Zhen Xu thought that Shi Lei was hesitating, so he also made a new decision.
“I know, you have your own worries. If you really won't agree, then I’m willing to give fifteen percent of shares. This way, your investment will raise to 450,000 yuan and it’s still a third. You can give me 150,000 yuan for the first installment.”
Shi Lei was blank for a second. He hadn’t expected Zhen Xu to be willing to give an extra five percent for the sake of 150,000 yuan in cash, which surprised him.
After a moment of thought, Shi Lei said, “I’ll discuss it with my lawyer.”
He immediately stood up, took the phone outside the cafe, and dialed Zhang Meimei.
He recounted the situation briefly and Zhang Meimei said, “That’s a good thing. I don’t see any problems with it.”
