American History 1988
Chapter 156 - 150 Listing Plan

Chapter 156: Chapter 150 Listing Plan

Well, one hundred million US dollars is indeed not a small number.

As long as Dean agrees to Gates’ acquisition, it means he’d immediately gain forty-five million US dollars in cash.

If his heart were a shade darker, directly refusing to acknowledge the financing from Sequoia Capital and KeyPoint Ventures, then that number would become fifty-six million US dollars.

To be honest, that amount of money is enough for Dean to live worry-free for the rest of his life, but it’s still not enough to make him part of the 1%, not to mention the 0.1%.

What’s most important is that it becomes very dangerous when you have so much wealth but lack the ability to protect it.

You must prove yourself, show your muscles, display your money-making abilities, and even being laughed at by others is fine—you just can’t be worthless.

Otherwise, everyone will leave you, including your wealth.

Of course, Dean had immense confidence in himself; one hundred million US dollars was not enough to sway him.

His decision made most people in the office breathe a sigh of relief, though there were some who felt regret.

Glenn Miller was actually very tempted by Microsoft’s offer; Mayfield now holds 5% of Byte Software.

If Dean turned his back on Valentine and the others, then Mayfield could pocket five million US dollars in cash.

After deducting the one million from the first round of financing, the net profit is four million US dollars.

According to the "2+20" principle for venture capital partners, Glenn could roughly take home an eight hundred thousand US dollars commission.

He’s just a junior partner at Mayfield, and in his investment career, an eight hundred thousand US dollars profit is enough to rank in the top three.

Such an amount of money is enough for Miller to buy a villa in the Bay Area and switch to a luxury sports car for himself.

Glenn Miller’s heart was dark enough, but the decision wasn’t in his hands, and he didn’t dare offend Valentine and Durell to their faces.

Seeing that everyone else had relaxed, Glenn Miller also put on a cooperative smile.

To be honest, he wasn’t confident about the patent dispute between Byte Software and Bell.

If it weren’t for the suggestion by Mayfield’s senior partner Wally Davis to wait and see for a while, Glenn might have wanted to offload his shares already.

Perhaps Durell would be a good target; from his overreaction to Gates just now, it was not hard to see that he would likely be interested in the shares in Glenn’s hands.

But, with the second round of financing just settled, that could wait until later.

Due to Gates’ unexpected call, Valentine and the others decided to resolve the contract issue that very day.

So, as calls were made one after another, soon lawyers and accountants started coming in and out of Byte Software.

Most of them were from Sequoia Capital and KeyPoint Ventures, drafting contracts, auditing finances, and so on—all requiring manpower.

It was not until the afternoon that everyone reached a consensus on various detailed terms, and Byte Software’s second round of financing officially came to an end.

According to the previously negotiated price, this round valued Byte Software at seventy million US dollars, releasing 20% of equity.

Sequoia Capital took 15%, with the remaining 5% going to KeyPoint Ventures.

After the new round of dilution, Dean’s holdings dropped to 44.8%, Morgan Tailer 8%, and Mayfield 4%.

The other two founders, Marcus and David, each held on to 5.6%, and the employee option pool shrank accordingly to 12%.

This is now the shareholder structure of Byte Software; because the valuation tripled in the second round, neither Morgan Tailer nor Mayfield followed up with more investment.

Morgan Tailer didn’t follow up because of its own strength, it couldn’t compare with top-tier venture capitalists like Sequoia Capital and KeyPoint Ventures.

The initial two million US dollar investment was already quite significant for them; now, this investment appreciated 3.5 times, and David Morgentaler had nothing to be dissatisfied with.

As for Mayfield, Glenn Miller was even considering jumping ship, so of course, he wouldn’t follow up with more investment.

Thus, Sequoia Capital, now holding 15% of Byte Software, took over the baton from Morgan Tailer and became the lead investor among venture capitalists.

The original total of 2.86 million shares also went through a 1:3 split, now turning into 8.57 million shares, priced at around eight US dollars each.

Once the contract was signed, everyone was on the same team. Valentine and Durell became Byte Software’s two new board members, expanding the board to seven members.

"Dean, let’s talk about the lawsuit with AT&T now," said Valentine, as all board members were present and he and Durell urgently needed to understand the current situation of Byte Software.

"We have filed a motion to dismiss with the Northern District Court of California; here are the evidence and documents we have prepared before."

Under Dean’s instruction, WAGR’s Boris Feldman handed the relevant documents over to Valentine and the others.

"We have sufficient evidence to show that Bell’s lawsuit is completely invalid," said Dean, referring to the receipt from the International Telecommunication Union and the principle of free promotion of the G.722 standard.

"Even if the court doesn’t accept all of our demands, it can buy Byte Software more wiggle room. In addition, we are also actively engaging the media to gain support on the opinion front."

Lately, due to this litigation, the Bay Area media had been quite busy.

Media outlets like the "San Francisco Chronicle" and "The Examiner" openly supported Byte Software. After all, the invoice Dean showcased is now widely circulated.

"The Mercury News" and "East Bay Times," on the other hand, felt sorry for Bell, claiming that Byte Software’s allegations were purely moral blackmail.

All this was to cover up the fact that they were using Bell’s patents without compensation; as for the invoice issue, these newspapers did not mention it at all.

In the half-month since Southern Bell initiated the lawsuit, the storm it had caused was heating up more and more.

"Dean, what we’re doing is not enough." After looking through the materials in his hand, Valentine was not satisfied with Byte Software’s current performance.

"Whether it’s newspapers or magazines. Their audience is limited, and mostly concentrated around the Bay Area; we need to broaden our influence on public opinion."

Valentine had big ambitions; he wasn’t satisfied with the reach of print media and wanted Byte Software to take even bigger steps.

"Let me think of something, we can do more." Valentine decided to go through his contacts once he got back.

"But the lawsuit isn’t everything for Byte Software, business is!" Valentine found the sales report he had just looked at, "Look, up till now, we’re still circling around the Southern states and the West Coast, this is too slow."

Turning to look at the map of America on the conference room wall, Valentine got up and walked over to stand beneath it.

"All these," he spread his arms to encompass all 50 states on the entire wall, "Byte Software needs to open branches in every state, or at least set up offices, and this should be done preferably before the end of this year."

Hisss—most people in the meeting room were shocked by Valentine’s appetite; this kind of expansion was something they had never considered.

"I agree with Valentine’s idea," just when everyone was considering whether the steps were too big, the lean Durell was the first to cast a vote of support.

"By the end of this year, we complete our layout in North America, and then next year we move to Europe and Asia. If things go well, we can prepare for the IPO in the third and fourth quarter."

Durell’s eyes were shining, especially when talking about the IPO; the sparkle in his gaze was enough to make one overlook his slender figure.

"Cough—" Marcus, sitting in the corner, couldn’t help but cough.

He was choked up; he thought Valentine was aggressive enough, but this was even more extreme.

What the hell! Why are we talking about going public all of a sudden? Shouldn’t we be worrying about the lawsuit right now?

However, his blunder didn’t attract everyone’s attention because others had more exaggerated reactions.

"Yeah—John, you really understand me!" Valentine laughed as he hugged his shoulder, "Guys, see? This is the right way to play venture capital."

Proceed according to plan? Steady progress? NO! Going public sooner is the real deal!

Before that, it didn’t matter if Byte Software was losing money; what mattered was to hold out until the IPO and ensure the sales report looked good.

Operating profits? Stock dividends? None of these compared to the gains from the IPO when the market valuation soared.

Venture capital firms kept investing in startups because they feasted on the gains from an IPO.

Of course, if one was overly aggressive, it could harm the future potential of the startup.

So Marcus couldn’t help wanting to speak up, but Dean stopped him. "As long as we can sort out this lawsuit, I don’t have any problems with such planning."

"Good!" Valentine was very satisfied with Dean’s cooperation, "The funds from the second round of financing will be in our account soon, and that will mark the beginning of Byte Software’s expansion."

"For the lawsuit, we’ll drag it out with Bell, and I will contact other companies about the technology patent to see if there are alternative solutions." Durell didn’t understand technology, but his network spread throughout the tech circle.

The voice encoding technology involved with Teams might be worked around by reaching out to other companies.

"OK, let’s split up and get to work." With an injection of $14 million, Byte Software now had the time to play cat and mouse with AT&T.

...

"Dean, remember to call me."

"Sorry, Miranda, I broke my promise."

"No, it’s not your fault, you did the right thing." Miranda lingered as she wrapped her arms around his neck, "You’re the coolest boy."

"Wow—I feel full of strength all over." Dean held her slender waist, "Baby, can you give me a little more?"

"Of course," Miranda smiled and offered her soft lips, and after a long while, their figures parted.

"I should go now," a plane touched down on the runway not far away, its engines roaring as it landed.

"I’ll visit you during the summer break." Dean waved his hand, watching as Miranda slowly disappeared into the airport terminal.

He had promised to accompany Miranda for a good time around California, but a series of events had interrupted this plan.

Only three days had passed, and Dean had to say goodbye.

Well, now wasn’t the time to indulge in pleasure; there would be plenty of time in the future.

"Boss?" Seeing him staring into the horizon, lost in thought, Anna, who had been invisible up to that point, finally couldn’t help but to speak up to remind him.

Dean, with his hands in his pockets, turned around, "Any reply from the Northern District Court yet?"

"Yes," Anna nodded seriously, "Because AT&T used their political connections, the Northern District Court did not approve our dismissal motion.

However, with the efforts of WSGR, the court agreed to hold a hearing, where both sides can orally argue the allegations."

"When does the hearing start?"

"In two weeks, at the beginning of June."

"I see," Dean nodded calmly, the energy of a behemoth was finally beginning to slowly reveal itself.