American History 1988
Chapter 198 - 192: A Prepared Mind

Chapter 198: Chapter 192: A Prepared Mind

"I’ve already spoken with Patterson; he will personally receive you."

Upon mentioning Axel’s name, Durell became completely indifferent to the aroma of the coffee in his hand.

"Aren’t you going with me?" Dean looked at him curiously, considering it was the other party that had facilitated the connection.

"I don’t want to see that guy Patterson right now; the last time I went to see him, he only treated me to 12 pieces of grilled corn!"

Of course, Durell’s refusal to go to Axel was not because of the grilled corn; he was still harboring feelings about Patterson’s refusal to invest in the Go company.

Yes, Durell had once pitched the Go company’s idea to Axel.

After receiving his business plan, Axel seriously had the company’s technical experts evaluate the handwriting technology.

In the end, they concluded that both the business plan and the handwriting technology seemed unlikely to succeed.

Then Patterson decided not to waste funds on these projects, and it was because of this disregard that Durell still held grievances to this day.

"Dean, just a reminder, the people at Axel are calm explorers.

They don’t follow trends, nor do they believe in luck; they claim to adhere to a professional investment strategy."

Axel is the venture capital firm in Silicon Valley that least resembles a typical VC firm, with an investment style that is the exact opposite of KeyPoint Ventures.

In order to gain a deeper understanding of the software and telecommunications fields, Axel even recruited many telecommunications experts.

They meticulously design and predict in related fields before investing, and only those startups that meet their expectations get favored.

This down-to-earth and methodical investment style ensures that Axel maintains an exceptionally high success rate.

Since its establishment in 1983, out of Axel’s 40 investments, only 5 had resulted in losses.

Of course, this overly cautious investment style could also mean missing out on some home runs.

For instance, Cisco, also in the telecommunications field, was a company Axel initially refused to invest in.

Because they doubted the management skills of Cisco’s founders and the latter did not have a reliable business plan.

This caused Axel to miss out on an investment return several dozen times over, but they insisted on the belief that singles are more reliable than home runs.

"As long as you keep hitting singles, home runs will naturally occur." This is also one of Axel’s investment philosophies.

Their approach is greatly admired by competitors, to the point where KeyPoint Ventures once directly funded Axel’s telecom fund with 2 million US Dollars.

Yes, KeyPoint Ventures was even an investor in Axel, which is why Durell was able to introduce Dean to them.

...

In Palo Alto, Silicon Valley, Dean could no longer recall how many times he had been here.

He was familiar with every street, but each visit revealed companies he had never noticed before.

Axel was housed in an inconspicuous small building; aside from the mailbox at the door, Dean could not find any sign advertising it.

"Durell has already informed me." Arthur Patterson was tall and thin, with a noble and rather quirky demeanor.

"It’s a pleasure to meet you, Mr. Patterson." Since the other party was straightforward, Dean also got straight to the point after sitting down.

"This is about AOL, an ISP company focused on network services."

As he took the documents, Patterson didn’t seem inclined to open them, "We have already done our investigation on AOL internally."

Dean was startled, okay—the pace of the conversation was somewhat beyond his expectations.

"So, how does Axel view this investment? I would think Mr. Patterson would be quite informed about the policy information regarding this matter."

Patterson was not surprised by Dean’s directness; it was even characteristic of his usual style.

"AOL is heading in the wrong direction." With just a short sentence, Patterson made his stance clear.

"The wrong direction?" This was the first time Dean had heard such an assessment of AOL from a venture capitalist.

"Ordinary household users cannot support its profitability and expansion; corporate users are currently the biggest demand group for network services."

Patterson’s comments were very precise, showing that Axel had indeed conducted a detailed investigation of the telecommunications market.

"But the privatization of NSF is beginning, and private service providers have formed a commercial internet exchange.

The future of AOL is bright; this won’t take long." Dean presented his opposing view.

"What you’re talking about is just a possibility, and the plans for the commercial internet exchange are still on paper.

The likelihood of this possibility dictates Axel’s investment attitude.

Obviously..." Patterson shook his head apologetically, "it didn’t pass our technical team’s evaluation."

"All right, thank you for your time today." Dean stood up, ready to leave.

"Dean, would you be interested in hearing our suggestions? Or perhaps discussing another deal?"

Patterson, like a well-mannered gentleman, unhurriedly called out to Dean who was preparing to depart.

"Another deal?" Apart from AOL, Dean didn’t think he had any other connection with Axel.

"Byte Company’s Teams is quite impressive; do you have your own plans for its further development?"

Patterson’s question once again caught Dean by surprise; everyone was focused on Byte Company’s current achievements and the subsequent IPO issue.

But here at Axel, they were actually concerned with the follow-up upgrade issue for Teams?

"To be honest, I’m quite excited that someone noticed the upgrade issue with Teams. But I’m sorry, this involves Byte Company’s strategic secrets. So..."

Dean now knew what should and shouldn’t be said.

As the CEO of a company preparing to go public, he needed to be mindful of his every word and action.

Unconcerned by his caution, Patterson smiled lightly, "This is information about a video conferencing company Axel invested in back in ’86."

At the mention of "video conferencing," a pang of concern struck Dean.

He now truly believed in Axel’s expertise in the telecom industry, just as Durell had said.

"Before the entrepreneur even speaks, Axel’s expert investors already understand 90% of what they’re going to say."

"I am amazed by your foresight, yet I still cannot comment on it." Dean stuck to his responsibility; Byte Company needed to maintain its air of mystery.

Patterson remained unfazed by Dean’s diligence, "At that time, we thought it was a good idea, but it turned out to be too ahead of its time.

Just like AOL just now, I do not deny its future prospects, but now it’s not the right time to enter the game."

Axel had been immersed in the telecom industry for seven or eight years and had a finger on the pulse of all its dynamics.

"The success of Teams software made us realize that perhaps the time is ripe now.

Because of previous investments, we have accumulated a significant portion of video conferencing development technology."

Thump, Patterson threw a thick stack of documents in front of Dean.

In his surprised gaze, Patterson slowly began to speak.

"Byte Company will initiate the last round of fundraising before the IPO, right?"

...

"Sorry Steve, there’s no suitable opportunity here on the West Coast."

By a phone booth on Palo Alto’s streets, Dean, while clamping the phone with his chin, flipped through the documents in his hands.

"Come on~" Steve’s voice came through, tinged with disappointment, "Don’t they realize that AOL already has a stable subscriber base?"

"You know, without enough expected return, venture capitalists aren’t interested." Dean’s eyes remained on the documents in his hands.

"These guys are like vultures; they won’t come down from the sky unless they smell rotting flesh."

Steve knew the venture capitalists didn’t care about AOL’s modest earnings; they were more interested in the home runs or grand slams of the capital game.

"What do we do now, Dean? Are we just going to watch UUNET snatch away all of Bell’s lines in the South?"

"The good news is we have other options." Dean finally finished going through all the materials.

Axel was indeed a tech-focused investment firm; their telecom experts made Byte Company seem unimpressive by comparison.

"I knew there would be a Plan B! Come on, Dean, throw it my way!"

"I’ll send you a fax later with the contact information for a Wells Fargo manager."

"Oh~Shit! Dean, why didn’t you tell me this news earlier?" If they could get a loan, why look for investors?

"Some things require repaying favors, Steve." Dean disliked free stuff because it often meant a higher cost of repayment.

"OK, I understand." Steve, coming from an elite family, knew the rules of the game.

"Anyway, I can only help you this much; whether you can get the loan is up to you now."

"Watch me." Steve wasn’t afraid of dealing with bankers since his brother had once been one of them.

After hanging up, Dean looked at the documents in his hand and couldn’t help but smile.

Alright, everyone who approached him was trying to hitch a ride on Byte Company’s coattails, one way or another.

Some people made direct requests, some offered something in exchange, and others aimed to achieve their ends through partnership.

Like Axel, what they offered was clearly more useful to Byte Company.

It could save Byte Company a great deal of technical resources, but of course, everything was still premature.

Even voice calling features were currently just circulating within businesses, to say nothing of video.

However, that didn’t affect Dean’s plans to lay the groundwork early, especially since some special clients needed it.

Patterson was right; before the IPO, Byte Company would initiate a third round of financing.

It would also be its final round of funding, and of course, the purpose was global market expansion.

By the end of the year, Byte Company had achieved its prior goals, completing its setup in America.

For the entire second half of the year, Byte Company had opened offices in nearly all fifty states.

Along the densely populated East and West Coasts were branches, while the more remote areas of the Midwest had offices.

In short, all fifty states guaranteed that every state was covered by Byte Company’s after-sales teams.

The cost was certainly high, with Byte Company’s revenues primarily invested in this round of expansion.

The return, however, was astounding, and next year it would bring a pleasant surprise to Byte Company.

Also next year, Byte Company was ready to enter the global market.

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