Tycoon: I Have an Unlimited Modifier novel Chapter 298

Chapter 298: Chapter 171: Borrowing a Hen to Lay Eggs (Part 2)

Even the astronomical valuation of seven billion yuan no longer seemed so hard to swallow.

"Black Ant Capital will be a Series A investor. I’m prepared to offer you 3% of the shares."

Qi Sheng was reluctant to part with too many shares.

However, Spicy King’s expansion did require capital.

Developing slowly just wasn’t his style.

Naturally, he had to use other people’s money to fuel his own venture.

Use the VC’s money to grow his own business.

Then, he would buy back the shares later on—a perfect, closed-loop business model.

’With the mandatory buy-back rights, I have no reason to worry about VCs refusing to sell their shares.’

’As long as I pay the current market price or valuation, the system will compel the VC to hand over the shares without a fuss.’

Of course, for a VC like Black Ant Capital that was getting in on Series A, they were guaranteed to make a killing.

But sometimes, having the eye to spot gold is what matters most.

Spicy King was on fire, and plenty of people saw its potential.

But so far, only Black Ant Capital had dared to commit to an investment this quickly.

Qi Sheng also knew that the seven-billion-yuan valuation he had proposed was somewhat inflated.

By the standards of the venture capital world, this was a valuation typically reserved for a unicorn company.

Since Black Ant Capital dared to take the plunge, Qi Sheng was more than happy to let them earn this profit.

"Isn’t 3% a little low?"

He Yu instinctively frowned.

He’d almost forgotten how difficult it would be for them to even swallow that 3%.

"President He, we’re talking about a seven-billion-yuan valuation."

"Forgive my bluntness, but whether your company can even come up with 210 million is a question."

It wasn’t as if Qi Sheng hadn’t looked into Black Ant Capital.

The firm was just getting started.

The first fund they raised was only 400 million RMB.

Among investment funds, their strength could only be considered average.

Even their most impressive investment, Pop Mart, was still over a year away from reaching its peak market cap of a hundred billion yuan.

"My apologies, that was an oversight on my part."

He Yu scratched his head in embarrassment, having almost forgotten he’d agreed to the staggering seven-billion-yuan valuation.

"It’s fine. If Black Ant Capital can afford it, I wouldn’t mind giving you even 5%."

Qi Sheng was quite magnanimous, and he understood the other party’s desire to earn a bigger slice of the pie.

"We can definitely afford 3%. You can rest assured on that, Chairman Qi."

He Yu naturally didn’t want to be underestimated by Qi Sheng.

Moreover, he was planning to persuade Qi Sheng to become a Limited Partner (LP) for their second fund.

These days, it wasn’t all that rare for an entrepreneur who received VC funding to later become an LP for the same firm.

But the prerequisite was that these entrepreneurs had already achieved great success and fame.

Having led their companies to successful IPOs, they had amassed fortunes in the tens or even hundreds of billions.

For example, Wang Star of Mg Group and Huang Zheng of Ping Duoduo.

In He Yu’s eyes, Qi Sheng had that kind of potential.

He was already the chairman of the Banyan Tree Group, worth billions.

He had casually made the extravagant move of spending hundreds of millions to acquire a hotel by West Lake.

The entire first fund raised by Black Ant Capital was less than what Qi Sheng had spent on that hotel acquisition.

Faced with a titan of an entrepreneur like this, even a prestigious investor like himself had to swallow his pride and curry favor.

"That’s good. If you need to conduct due diligence, Yuan Li will cooperate with you."

"However, Spicy King only has the flagship store in Taikoo Li. The other branches are all under intense renovation, so there’s not much to investigate."

Qi Sheng was well aware of the process for a VC firm investing in a company and was perfectly willing to cooperate.

"Then it’ll just be a formality."

He Yu smiled, not minding much.

In his bid to invest in Spicy King, he had eaten at the Taikoo Li flagship store four or five times in a single week. Even going to the bathroom had become a struggle.

Perhaps even Qi Sheng, the owner, didn’t know Spicy King’s revenue and customer traffic as well as he, the investor, did.

"Well then, here’s to a fruitful collaboration and to making a fortune together!"

Qi Sheng stood up with a smile and shook He Yu’s hand.

"Haha, I also hope Spicy King expands beyond the Southwest and goes national soon!"

He Yu was also full of anticipation, hoping his intuition wasn’t wrong.

"It will. I hope to still see Black Ant Capital among our investors then."

’Qi Sheng knew how VCs operated.’

He wouldn’t be the least bit surprised if they decided to sell their shares down the line.

"If we can close our second fund quickly, I will definitely make a follow-up investment in Spicy King."

He Yu felt a twinge of regret and frustration.

With Sequoia’s financial might and the resources of a top-tier VC firm, they were a terrifying presence that a fledgling firm like Black Ant couldn’t hope to compete with.

"Su Kai accepted the seven-billion-yuan valuation too?"

He Yu felt a surge of relief, not doubting the magnate’s judgment in the slightest. ’What a close call,’ he thought.

"Before I left, I saw him chatting and laughing with President Yuan. I’m guessing he’s quite pleased with the valuation."

"A seven-billion-yuan valuation sounds high, but that’s only about 1 billion US Dollars."

Zhang Peiyuan gave a wry smile. "Which company targeted by a top VC like Sequoia doesn’t start with a valuation in the billions of US dollars?"

"That’s true. With Sequoia in the game, it’ll be easier for us to raise our next fund. Hopefully, we can get in on Spicy King’s Series B financing."

He Yu no longer held out any hope for the remaining 2% of shares.

Now, he could only pray that Sequoia wouldn’t drive the Series B valuation up too high.

"You’re that bullish on Spicy King?"

Zhang Peiyuan was a little surprised, not expecting his old partner to be so persistent.

"It’s less about being bullish on Spicy King and more about being bullish on Chairman Qi. When I get a chance to introduce you to him, you’ll understand."

He Yu patted Zhang Peiyuan’s shoulder.

"Let’s go. We’re going to sign the contract with President Yuan right now."

"This urgently?"

Zhang Peiyuan’s face fell.

"We haven’t even done our due diligence yet."

"Due diligence my ass! You think that bastard Su Kai is a pushover?"

He Yu shot Zhang Peiyuan a speechless glare.

"We’re racing against Sequoia! If we delay too long and they just offer a higher valuation, how are we supposed to get on board?"

"Uh, they wouldn’t, would they?"

He Yu’s words had shaken Zhang Peiyuan’s confidence, and he frantically started to call for a car.

"I knew I couldn’t count on you! What’s the point of calling a car now? I already booked a hotel, and they’ve sent a car to pick us up."

After speaking, He Yu grabbed his suitcase.

He sprinted toward the exit at the speed of a hundred-meter dash.

"Fuck, you bastard, wait for me!"

Zhang Peiyuan quickly grabbed his laptop bag and suitcase and chased after He Yu toward the exit.

Some people at the airport saw the two men acting like lunatics and couldn’t help but look at them with contempt.

Little did they know, they were chasing a return on investment worth hundreds of millions.