American History 1988
Chapter 219 - 213: Waiting for a Phone Call

Chapter 219: Chapter 213: Waiting for a Phone Call

"Have you heard? Byte Company is secretly carrying out the ’Vision Project’."

Larry revealed the news with a mysterious expression, mirroring the one Dean had that evening.

"The Vision Project?" Dick was surprised. He was a shareholder of Byte Company but knew nothing about the project.

"A revolutionary product, it’s said to fulfill all office needs."

Well, Larry himself didn’t know what the product was, but that didn’t stop him from boasting to his friend.

Yes, Larry Stone and Dick Kramlich were friends, often sitting together to share news with each other.

"How did you come to know of it?" Dick was initially skeptical.

"Dean himself said it, and the governor of Arkansas was present.

Everyone was fascinated by the project, and in the future people might enjoy technology like in the 007 movies.

Dick, not all movies are entirely fantasy; now the dream is likely to become reality."

"Oh~, if this product actually comes out, I think I’ll go crazy for it."

Until now, Dick had told no one but his companion at the time, Regis, about the shares he had received from Byte Company.

"Dean is a genius, he even has a clearer vision of the future than Jobs."

Larry was still amazed by the future described by Dean that night, something no one had ever detailed so vividly.

Self-driving cars, artificial intelligence that can converse with humans, and mobile phones as thin as a pizza.

All this seemed as if he had personally experienced it; Larry’s soul trembled at Dean’s boundless imagination.

Dick’s eyes flickered, perhaps he shouldn’t be in a rush to cash out after Byte Company goes public.

"Regis, have you heard? There’s a Vision Project inside Byte Company."

That evening, Dick, unable to bear keeping the secret to himself any longer, ended up sharing the news with Regis.

He had gotten a share of Byte Company’s stock from him, and Dick thought he was a good person to share the information with.

"The Vision Project?" Regis was gloating over his investment in Byte Company, knowing that many big names in California hadn’t gotten a ticket.

"Yes, Byte Company is developing a revolutionary product that will overturn all expectations."

The following morning, Regis revealed the news to Mary Mikel, who was visiting San Francisco.

She was an East Coast friend of Regis’s, serving as an analyst at J.P. Morgan on Wall Street.

They both worked in media-related fields, so they were well acquainted and even shared news with each other regularly.

Thus, in less than two days, the ’Vision Project’ Dean spoke of had not only spread through Silicon Valley.

It had even flown to the East Coast and further south to Arkansas.

Clint, finishing his tour in Silicon Valley, returned to Arkansas brimming with excitement about everything he had seen in Silicon Valley.

Byte Company and the ’Vision Project’ were frequently mentioned by him, and of course, their "own man" Dean Price.

...

"You turned down Morgan Stanley’s 1 billion dollar valuation?!" Arthur Locke exclaimed in disbelief.

"Yes," Dean calmly spread his hands, "because I think it can go even higher."

"Bullshit!" Arthur Locke exploded, furious, "That’s 1 billion dollars! Not 100 million!

Do you know how many companies dream of such a figure? To convince the folks at Morgan Stanley, I even contributed my own Romanée-Conti!"

Arthur Locke had reason to be angry, as it was he who had invited Morgan Stanley’s people.

It was also he who convinced the old-money crowd on the East Coast that Byte Company was exceptionally valuable.

In pushing the stock value of Byte Company, Arthur Locke even half-bluffed and half-led them on, with the ’Vision Project’ he himself didn’t fully understand.

billion dollars, Arthur Locke could not find a reason to refuse it.

This meant that his initial 4 million dollar investment from two months ago had already increased by 2.5 times.

Could there possibly be any business more profitable than this? Most importantly, this was just the IPO valuation, and new stocks usually went up upon listing.

Seeing Dean remain unmoved, Arthur Locke nearly went mad.

"Dean, you’ll regret this!"

"Calm down, Arthur. At least now we have an offer of 1 billion dollars," David Morgentaler had to intervene to smooth things over.

An IPO wasn’t even underway, and they were already having disputes inside, not a good sign.

"But that’s 1 billion dollars! David, that means your initial investment has turned 50 times over!"

Well, Arthur Locke’s infuriated shouting also made David Morgentaler’s heart painfully twitch.

times, such an investment return could absolutely make it into the records of Silicon Valley... no, of American investment history.

David Morgentaler struggled to convince himself that this was just the first offer, Byte Company still had chances.

"Guys, this is just the beginning, and besides, we didn’t fall out with Morgan Stanley, did we?"

"I support Dean," spoke up John Duerr just then.

"Morgan Stanley only saw Byte’s Teams, but they didn’t see our other trump card."

"Are you talking about the IP telephony business?" Valentine knew Duerr was very invested in this new project.

He even volunteered to take on the role of representative director at World Link Company.

"1 billion dollars is definitely not the ceiling for Byte Company’s valuation—I think it’s worth at least 1.5 billion dollars!"

Duerr uttered his audacious statement like a man talking in his sleep, shocking everyone into thinking he was on drugs.

"Did you smoke some leaf last night?" Even Valentine, known as the "Rocket Man," found Duerr’s bid unrealistically high.

A 1.5 billion dollar valuation for a software company that wasn’t even public yet—such a thing had never been seen in Silicon Valley.

It wasn’t just him, everyone present didn’t take Duerr’s words seriously.

They knew it was impossible, even if Byte Company desired it, no major underwriter would pay the bill.

Nowadays, companies going public would basically opt for an underwriting model.

The professional term for this is "underwrite," which literally means "to undertake to buy."

Simply put, when stocks can’t be sold, underwriters take responsibility for buying them up.

Imagine, if the market doesn’t bite at a 1.5 billion dollar valuation, what would that look like?

Underwriters would definitely not take that risk, it’s a gamble without odds of winning unless they find buyers first.

"Gentlemen," Dean tapped lightly on the table, "don’t you want your shares to be worth a little more?"

"But not some farcical joke of a 1.5 billion dollar valuation!" Arthur Lock thought these people had lost their minds.

The vultures on Wall Street wouldn’t take this risk.

"Do you have any suggestions, Dean?" David Morgentaler felt he might still have a card up his sleeve.

"Wait," Dean uttered quietly.

"Wait for what?" Lock asked anxiously, "It’s already May, don’t forget that our target is to go public in the second half of the year!"

"You’re right, it’s already May." Dean’s eyes held a hint of anticipation.

"So..." Valentine was thoughtful, "what’s so valuable that you give up the temptation of 1 billion dollars and decide to wait?"

"Waiting for a call." Dean’s gaze shifted to the lean Duerr.

Drip drip drip...

The phone call arrived as expected.

Everyone in the conference room turned their attention to Duerr.

The latter calmly answered the call, "This is John Duerr..."

"I see." A minute later Duerr hung up the phone calmly.

"John?" Impatient Valentine couldn’t help but query.

Duerr glanced at Dean, whose face was faintly smiling.

He saw it—Duerr was trying to remain calm, but his hands were trembling slightly.

"40 million dollars..." Duerr’s voice, like his hands, had a barely containable tremor.

...

In San Antonio, Texas, at AT&T’s headquarters at Plaza One.

As the name suggests, the building housed here is the Texas headquarters of AT&T Telecommunications.

AT&T has dozens of subsidiaries, among which AT&T Telecommunications is one of the three major core sales departments.

It mainly deals in switch operations and long-distance telephone service, and its branches are nearly ubiquitous throughout America.

Today, John Stankey sat in his office, reviewing the sales report for AT&T in April.

He is the CEO of AT&T Telecommunications and one of the top executives in the AT&T Group.

Usually, such sales reports don’t fluctuate too much since the long-distance telephone market is nearly fixed in size.

Although AT&T Telecommunications has competitors like MCI and Sprint, after decades of competition, their pieces of the market pie hardly change.

John Stankey glanced casually at the report, 600 million dollars? His brows instinctively furrowed.

That number seemed a bit low; he remembered it should be around 640 to 660 million dollars.

The annual sales volume of AT&T Telecommunications’ long-distance business hovers around 8 billion dollars.

That doesn’t include international calls; the report in his hands was just the domestic telephone business data.

Because the data was domestic, John Stankey was even more sensitive to the change.

He rummaged through his desk and quickly found the previous month’s data.

A glance at the figure, 650 million dollars, showed an almost 8% decrease in market share compared to before.

To John Stankey, this was akin to an earthquake, as the long-distance telephone market typically doesn’t sway more than 1% a month.

Now this 8% downturn was too conspicuous, and the board would certainly demand an explanation from him.

John Stankey picked up the recent report and began to scrutinize the detailed state-by-state statistics.

In the past, he wouldn’t even pay attention to the lengthy tables if the overall sales stayed steady. But today, he needed to understand what was going on.

He quickly found the answer—Texas, Louisiana, Georgia, and Florida, each of these states had varying degrees of decline in their sales.

Especially Texas, the state he was in, which had nearly a 20 million dollar decrease in its long-distance telephone business sales for April.

Such a significant drop was too abnormal, John Stankey knew something had happened.

"William, we’ve been stabbed in the back!" John Stankey immediately informed his deputy, William Kennard.

Yes, an old friend of Byte Company, the former CEO of AT&T Information Systems of California, William Kennard, had now been transferred to AT&T Telecommunications.

The position was a slight demotion, and of course, the reason for that was the less-than-pretty lawsuit.