American History 1988
Chapter 218 - 212 The First IPO Valuation

Chapter 218: Chapter 212 The First IPO Valuation

The $200,000 check was, of course, "soft money," which would enter the Clintons’ own foundation through less obvious channels.

Typically, these funds have nice names like the "American Health Transformation Foundation."

Then these non-profit organizations take the money to shoot campaign advertisements for the candidate.

All of the above is legal and legitimate in America; that’s the role of "soft money."

Of course, for the Clintons right now, two hundred thousand dollars is absolutely a huge sum.

Not to mention the general election, Clinton doesn’t even have such a firm grasp within his own party, let alone donations from voters.

Now, with a speech less than half an hour, they have received a generous return in Silicon Valley.

Clinton’s performance exceeded Silicon Valley’s expectations, and Silicon Valley’s gains exceeded Clinton’s.

Of course, they know who the real backers are and what kind of response they should give.

"Dean, I think Byte Company’s products are groundbreaking, perhaps the Arkansas government should consider using new communication tools?"

Clinton, having already received the news from his assistant, specifically found a quiet place to privately express his gratitude to Dean.

"I’ve said it before, we’ll support our own." See, the two hundred thousand dollars was not without its rewards.

"You’re absolutely right, we’ll help each other." Clinton warmly patted Dean on the shoulder.

"By the way, tell me about Byte Company, I’m fascinated by it."

"My pleasure." Then, seizing the opportunity, Dean greatly embellished Byte Company.

"Our concept is revolutionary, our products are safe and reliable.

Of course, Byte Company is more than just Teams; we’ve also broken into the IP telephone market.

In the coming years, the ’Vision Project’ will be implemented as a priority."

"The ’Vision Project’?" Clinton found the term intriguing.

Larry Stone, who had been accompanying him, pricked up his ears, and Baram, who had been lingering around, subconsciously lightened his step.

"Yes, the ’Vision Project,’ a grand plan designed for the future of smart offices.

Every task you can imagine can be achieved through Byte Company’s ’Vision Project.’

Data analytics, project management, international meetings, financial reconciliation, paperless offices, the Internet of Things..."

Dean spat out words they had never heard, not understanding them was no matter.

To sell his concept, Dean detailed what life should look like under future computer technology and the Internet.

Of course, Dean wouldn’t really reveal his company’s strategic details; these were just grandiose claims, like something out of a science fiction novel.

However, Clinton still didn’t understand much, but he was charmed by some of the scenarios.

"You’re saying that everyone can carry a computer the size of a palm and then send messages to their friends through the Byte software on it?"

"Exactly, and you can even see the other person through that small screen."

"Oh~" Clinton blanked for a few seconds, still unable to imagine what that would be like.

"Like the special imaging products that Bond uses in the 007 movies?" Larry Stone thought he found an apt comparison.

"Cooler than that," Dean smiled mysteriously, "Anyway, it’s not fantasy, Byte Company is already on it."

"Unbelievable," that was beyond Clinton’s imagination, "The ’Vision Project,’ I’ll remember that."

The ’Vision Project’? Larry Stone and Baram quietly noted the name in their minds.

...

"Richard Fischer"

"Dean Price"

At Byte Company’s conference room, Morgan Stanley’s representative and Dean had their first meeting.

This meeting should have been scheduled earlier, but Clinton’s visit postponed it by two days.

"I saw a vibrant company where everyone is filled with enthusiasm."

Just from a brief tour, Byte Company’s thriving scene left a deep impression on Richard.

This place is entirely different from the stodgy corporations on the East Coast. Richard even saw employees brazenly playing video games during work hours.

What shocked him even more was that the game console was prepared especially for the staff by Byte Company.

They even reserved a special entertainment area, surrounded by relaxed employees during break times.

This was unimaginable on the East Coast; in his decades of career, Richard had never heard of such a thing.

He was a bit puzzled by the West Coast, even more by Byte Company.

"Alright, Dean, let’s get to the point," Richard tried to clear the clutter in his mind.

"Byte Company is successful, I think it’s time to push it onto a bigger stage.

You’re ready for this, and you’ve worked hard for it, right?"

"Of course, that’s why we’re sitting here now.

Look at those young people outside; they make hundreds of millions of dollars in sales every year.

For them, there’s no better reward than going public."

Last year’s sales figure for Byte Company was the best advertisement; otherwise, reps from Morgan Stanley wouldn’t have come knocking on their own initiative.

"Good," Richard nodded with satisfaction, "Look, our goal is the same, that is to take Byte Company public."

He took out a leather-covered notebook from his black briefcase, meticulously opened it to the marked page, and carefully placed the bookmark aside.

"So? What are your thoughts on the IPO, for example, the choice of listing location?"

"Nasdaq," Dean replied without hesitation.

"A wise choice." Richard was not surprised by the answer.

Nasdaq has the most lenient standards and is the perfect first choice for listing high-growth tech stocks.

"Morgan Stanley is the top investment bank in the world, we have a wealth of underwriting experience, having handled countless successful cases.

So please forgive my sales pitch, we are very much looking forward to participating in the preparation of Byte Company’s prospectus."

The major role of an underwriter, besides marketing the stock, is to participate in the stock pricing.

Normally, the number of shares issued and the price are determined through negotiation between the company going public and the underwriters.

This figure is not decided arbitrarily; it is calculated rigorously and then a range is estimated.

Of course, since today it was a private meeting with Dean without other board members present,

Richard’s goal at this moment is to have Byte Company choose Morgan Stanley as the lead underwriter.

In addition, both parties aim to have a broadly similar target in their prediction of Byte Company’s market valuation.

"We trust the professionalism of Morgan Stanley, and we believe you will handle all of this well.

So, about the IPO valuation of Byte Company, Mr. Fischer, what would you suggest?"

This is an exciting topic, but at the same time, it’s not so easy to answer.

"Byte Company was valued at 400 million dollars in its third round of funding, correct?"

"That’s right," Dean nodded candidly.

"According to our analysts’ market performance review of other software companies on Wall Street,

The conventional valuation for Byte Company is expected to reach about 600 million dollars.

However, considering it’s a new listing, and Byte Company’s profit margin is above the market average, this number could be raised to 800 million dollars."

Richard paused for a moment, deliberately glancing at Dean.

But the latter was still impassive, as if it were just a soulless number.

Well, it seems that the valuation did not impress him, and of course, this was not Morgan Stanley’s final valuation.

"However, because Byte Company is in a period of rapid growth, and the Teams software has no competitors at the moment.

And with the global market development strategy bonus, many institutions have shown interest in Byte Company.

So, our final valuation for Byte Company is 1 billion dollars!"

Having said that, Richard replaced the bookmark in the notebook, carefully smoothed down the page corner, and then slowly closed the notebook with deliberate pace.

He smiled, looking confidently and proudly at Dean.

billion dollars, a name truly worthy of a unicorn company.

That’s a goal many companies strive for decades without achieving, and even Oracle and Microsoft were only valued at just over 200 million dollars when they went public.

But now, at the initial phase of the IPO, Byte Company already surpassed the former two by more than five times.

Richard believed this valuation was unprecedented in the software industry, and Byte’s listing would surely ignite a new wave of enthusiasm for software.

He had also integrated the assessment of Arthur Lock and that enigmatic "Prospective Plan" to reach this extremely high market value estimate.

Yes, the information obtained from Arthur Lock had significantly raised Richard’s appraisal of Byte Company.

The former had significant influence on the East Coast, and once this news was released, they would make the same choice as Richard.

As for the 1 billion dollars, it was an incomparable figure, one that no one could remain indifferent to.

With Morgan Stanley’s endorsement, Dean’s net worth at this moment could already be penned at over 300 million dollars.

But unexpectedly, Dean was not as excited as imagined, and even in his eyes, Richard saw disappointment.

"Mr. Fischer, have you heard of Byte Company’s other businesses?"

"Other businesses?" Richard was taken aback, as frankly, he had only recently come to know the name Teams.

"Teams is just a negligible part of Byte Company. We also have business in IP telephony, digital audio,

And a new project management software under development, and we even have a ’Prospective Plan’ for it."

billion dollars was a lot, but Dean’s ambitions were greater.

It was only the end of April; he was willing to wait a bit longer to let Byte Company’s reputation and recognition spread further.

Whether it’s IP telephony or promoting other concepts, it all takes time.

"Perhaps we could choose another time to talk again, giving us a chance to understand each other better."

Dean wasn’t in a rush to reach a private agreement with Morgan Stanley’s people; Byte Company still had time.

Moreover, the board would introduce other underwriters; comparison shopping wasn’t a bad idea.

Richard’s face changed colors, Dean had just listed several businesses that he had mostly not heard of.

Was Morgan Stanley’s information too outdated? Or was Byte Company growing so fast that it was overwhelming?

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