Start with hooves

Chapter 71 The Golden Egg Hen
Su Rui's quotation seemed to be full of sincerity.

Mr. Reed Hastings was quite moved. He has been trying to transform into a real Internet company, and he thinks this is a good opportunity.

So after dinner.

Reed Hastings immediately asked Chief Operating Officer Greg Peters to call other board members and decide to hold an interim board meeting tomorrow morning to focus on whether the financing should be split.

Anyway, he, the founder of the company, and Greg Peters were more optimistic about the cooperation proposal, and after discussing it, they thought they should try it.

With the recent financial crisis, Netflix's stock price has plummeted. Major shareholders and retail investors are in urgent need of good news to stimulate the company's stock price to recover.

According to Greg Peters.

Even if Internet TV fails to develop after the joint venture, at least in the near future it will be able to boost Netflix's stock price. By selling the concept to the outside world, it will attract the attention of potential investors and increase the market value by three to five billion U.S. dollars.

Moreover, after the financing is negotiated, there is no need to continue to spend money to fill the gap in the short term, and the financial report in the fourth quarter of this year will be much better, which is also conducive to the long-term development of the company.

And CEO Reed Hastings, eager to solve a problem first.

He was very curious about how much it would be worth if the Internet TV project was split separately.Now this is just a department of the company, and no agency has specifically estimated the value.

After Reed Hastings finished the call, he temporarily hired a team of consultants from McKinsey Consulting. A group of people came to Netflix headquarters that night, worked overtime overnight, and collected data by category.

Su Rui's men can think of the value of Netflix's intangible assets.

Professional institutions such as McKinsey Consulting Company, of course, will not let go of any real valuable assets. When calculating the valuation, the intangible assets will be discounted, and hardware servers, software development costs, etc. will also be included.

The next morning.

When Mr. Reed Hastings arrived at the office, he was handed a property valuation statement.

The data shows that the average number of daily active users of Netflix Internet TV is more than 70. He simply browsed to the end and found that the valuation given by McKinsey Consulting Company is about 6000 million US dollars to [-] million US dollars.

The Internet TV company itself is not worth so much money, but Netflix's own user resources are very valuable.

Various valuation agencies in Silicon Valley have similar methods of evaluating asset value, and many non-listed companies and venture capital institutions basically recognize the results of these professions.

After reading the report.

Reed Hastings was both pleasantly surprised and dismayed.

He thought to himself that there are not so many pies in the world, and Su Rui is not as generous as he imagined.

Last night, I only stared at the more than 4000 million US dollars spent on the project, thinking that the entire project would cost about 3000 million US dollars, but ignored the value of Netflix’s platform resources. There are a total of more than [-] million monthly active users, and the advertising fee is Worth a hundred million dollars.

No wonder Su Rui mentioned many times during the meal last night that the current drainage and promotional channels should be kept and not completely separated.

Originally thought that there was a full [-]% premium, but after reading the valuation report, I found that the premium space has shrunk by a large amount, and the feeling of missing something has instantly faded.

Of course.

The cooperation plan proposed by Su Rui is still very attractive.

Therefore, Reed Hastings decided to continue to hold the board of directors to let everyone brainstorm and talk about their ideas.

……

It is already October of 2008, and Christmas will be celebrated in two months.

Netflix performed very well in the first half of the year. In September, it suddenly encountered the financial tsunami, and its market value plummeted by one-third, basically falling back to the level of the same period last year.

All independent directors are having a headache because they cannot meet the standard of option rewards, and the bonuses received at the end of the year will be seriously reduced.

Come over for a meeting today.

Surprised to learn that Su Rui, the fourth largest shareholder of Facebook, proposed to spin off an Internet TV company and was willing to provide more than 2 million US dollars in financing, which surprised them badly.

There are basically no idiots who can be hired as a board member. They must care about the interests of shareholders and their own profits.

After reading the valuation report that Reed Hastings asked someone to analyze overnight, several non-executive directors quickly reached a tacit agreement and agreed to discuss a detailed charter and separate the Internet TV project as soon as possible.

Like Suri said.

He is just financing, not acquisition.

Even if the project is split, it will still exist as a subsidiary of Netflix, and there will be no loss for them. Instead, they will be able to transfer risks, add some new profit points, and successfully overcome the immediate difficulties.

Everyone agrees.

Reed Hastings also couldn't fault it, so he simply voted on the spot and passed easily.

From Suri's point of view.

This is the practice of the prodigal, selling the hen that lays golden eggs.

However, as far as the current Netflix is ​​concerned, the core business is still video rental.

The Internet TV project is a less successful transformation, the market response is mediocre, and it also faces competition from other film and television companies.

Keeping it in hand may not lead to a smooth development. It is far better to cooperate with Su Rui and borrow the financing provided by him to go to the unknown road ahead.

If it fails, there is no need to say more, anyway, it will not be much worse than it is now, but if it is successfully operated, it will be a white surprise.

Faced with a total of 5000 million US dollars in financing, everyone felt that they were a bit clueless about bargaining, and it was easy to make a decision...

----------

Stayed up all night again last night.

Suri had just woken up and was on her way to brunch when she got a call from Reed Hastings.

The other party told that as early as Monday, the teams of both parties can contact to discuss the details of splitting, management and follow-up cooperation.

Su Rui thought that he would probably agree, but he didn't expect it to be so fast.

The efficiency of large companies has always been sluggish, but it is not as good as some small start-up companies. Today, they performed exceptionally well. Obviously, they put the price in their hearts last night.

Although the child was lost, fortunately, he succeeded in trapping the wolf, which was not considered a disadvantage.

After signing the formal contract, the 5000 million US dollars in cash he invested will soon begin to increase in value, and recalculate a market valuation in the form of an Internet company.

After hanging up the phone.

Su Rui asked Secretary Amanda to contact Goldman Sachs to hire some experts who are good at financing acquisition negotiations as soon as possible.

I mentioned last night that I try not to interfere with the management work, but that is on the premise that everything is going well.

Consensus must be reached on management candidates, how to divide the right to speak, and long-term development strategies, so as to avoid bickering in the future.

As the second shareholder, I don't have the absolute right to speak, and it is easy to suffer losses if I make it clear.

This requires hiring more board members, introducing third-party decision makers, and allowing them to participate in specific decisions to prevent the parent company from making muddled decisions.

At that time, the rights of the board members will be written into the company's articles of association, and let them act as lubricants to achieve a certain balance.

For example, when there is a disagreement between the major shareholder and the second shareholder, and they cannot coordinate on their own, and the difference in the right to speak between the two parties is very small, the members of the board of directors can vote and make a final decision. Focus on the swing states.

The market value of Netflix as a whole is basically equivalent to his personal wealth.

Even the founder Reed Hastings, who lost too many shares in the early years, is only worth about one-tenth of Su Rui, so there is no need to worry about being easily ostracized.

There are many things to prepare today.

I didn't care about playing around with Miss Daddario, so I gave her a credit card supplementary card and asked her to go shopping by herself and buy some clothes and jewelry she liked.

This girl is quite sensible.

He rejected the proposal to go shopping alone, and also confiscated Su Rui's credit card.

I just want to be by his side, be a little secretary who helps carry bags, and take a look at the customs and customs of the Silicon Valley area...

(End of this chapter)