American History 1988
Chapter 280 - 270: Turning Decay into Magic

Chapter 280: Chapter 270: Turning Decay into Magic

AOL, as one of the first companies to enter the internet service sector, actually enjoyed a good reputation on the East Coast.

In its early days to expand the business, Steve Case actively sought various potential partner companies for AOL.

In 1987, the partnership with Apple to develop Applelink was one of those initiatives, and later AOL continued to develop PC-Link for compatible machines.

This move greatly displeased Apple, as they did not want AOL to develop software for their competitors.

From a market perspective, Apple and other compatible machine manufacturers were in direct competition.

Any company that became part of Apple’s supply chain could only serve Apple, that is, as an exclusive supplier.

AOL’s behavior undoubtedly made Apple feel that it was supporting its own competitors, and this could even lead to the leakage of Apple’s secrets.

So Apple forcefully demanded that AOL abandon the development of PC-Link and instead focus on Applelink.

Of course, Steve Case would not agree, so it wasn’t long before the two companies parted ways.

Ironically, in order to remove the word "Apple" from Applelink, Apple even paid AOL a breakup fee of 2.5 million US dollars.

This is Apple, which shows its closed nature.

Also because of the disruption of the business with Apple, AOL once encountered a business crisis in 1990.

When its old rival America Online heard this, it made an offer of 50 million US dollars to acquire AOL.

Luckily, the young and ambitious Steve Case stood against the pressure from other shareholders and strove to ensure AOL’s independence.

His persistence soon paid off, and a few months later, AOL reached an agreement with the publisher of the Chicago Tribune.

AOL provided various online news and its local services on its client for the Tribune.

In return, the publisher of the Chicago Tribune invested 5 million US dollars in exchange for 9.5% of AOL’s shares.

With this investment, AOL gradually got out of the crisis and slowly attracted more and more users.

Latter on, Dean advocated the establishment of the CIX Alliance, which presented an opportunity to Steve Case.

AOL was eager for such an alliance to be established and also coveted the Teams technology from Byte Company.

Eventually, the parties involved quickly reached an agreement to cooperate.

Armed with an instant messaging system and a check for several hundred thousand US dollars, Dean acquired about 10% of AOL’s shares.

Steve Case’s investment was risky, considering the acquisition of an instant messaging system cost him shares worth over 4 million US dollars.

But the end result proved he was right; the revamped AOL chat rooms have now become their most popular service.

Every day, tens of thousands of people gather in a variety of channels, bringing in substantial business revenue for AOL with such traffic.

After nearly two years of development, the number of users has increased by more than three times.

Now with more than 400,000 users, AOL is about to begin its journey to going public.

As a major shareholder and as a new generation of tech star in America, Steve Case urgently needed Dean to stand by AOL.

This was an IPO; in order to promote AOL, Steve Case was eager to use all the resources at his disposal.

Dean, a shining billionaire signboard, of course, was not to be missed.

So under Steve Case’s urge, Dean finally got on the flight to Virginia.

But this time, he was not alone; sitting next to him was an old acquaintance, Durell.

"Dean, what do you think the market value of AOL will be on its first day of trading?"

Dean, who was about to put on an eye mask, had to stop and continue to chat idly with the energetic Durell.

"It certainly won’t break on its debut, I trust my own judgment."

"Come on, you’re one of its major shareholders~" Durell was unsatisfied with Dean’s perfunctory reply.

"Alright," Dean moved his hand away from the eye mask, "a small increase is definite, but as for how much, that will depend on Wall Street’s attitude toward the internet."

"I have the same premonition," Durell said, a touch disappointed as he spread his hands, "it looks like KeyPoint Ventures won’t make a grand slam this time."

Dean shrugged nonchalantly, "Not every time can you be that lucky, otherwise everyone would want to be a venture capitalist."

KeyPoint Ventures was also one of AOL’s shareholders, grabbing a ticket to join in at the last moment.

Two years ago, Dean had even discussed AOL’s investment with Durell.

Unfortunately back then, the internet hardly piqued the interest of venture capitalists on the West Coast, but the situation changed this year.

With the promulgation of the "High Performance Computing Act" and the countdown to the end of NSFNET’s era,

the capital circle knew the internet was about to become increasingly important, and such changes often held business opportunities.

So venture capitalists were among the first to act, consciously looking for suitable projects.

Durell, known for his impromptu investments, was definitely a man of action among them.

While Valentine was still puzzled about the internet, Durell had already started drinking coffee at Dean’s home.

He thought of AOL which Dean had recommended before; instead of searching aimlessly, it was better to chat with an old friend.

Durell was adept at utilizing his personal relationships, always able to find the right people to help him when needed.

So, with Dean’s recommendation, KeyPoint Ventures built a relationship with AOL.

But because AOL had already completed its IPO plans, KeyPoint Ventures only obtained a limited number of shares.

However, Durell was one to never miss out on an IPO, regardless of the share percentage.

He enjoyed watching the names of startups suddenly appear on the exchange’s electronic screens.

This moment of breaking through gave Durell a sense of vigorous vitality, and he was fascinated by it.

So even though KeyPoint Ventures was not a major shareholder of AOL, Durell still appeared on the flight.

Dean, who was now roused from sleep, took the opportunity to inquire about another matter.

"By the way, how are things with Go company?"

Since the last time the two had discussed it, two or three months had passed.

During that time, Dean’s focus had mostly been on the competition between Intuit and Microsoft, while Durell had not been in California for most of that period.

As far as Dean knew, he was frequently shuttling between Ohio and New Jersey.

One was the headquarters of NCR, and the other was the territory of AT&T.

Now that Durell had the time to go to the East Coast to watch AOL’s listing ceremony, it must mean that the matter with Go company had been resolved.

Hearing Dean’s question, Durell’s eyes emitted an indescribable glint.

"Dean, I need to thank you for finding two excellent trading partners!"

"How so?" Dean raised an eyebrow, intrigued.

"I contacted NCR first, and as you analyzed, they showed great interest in Penpoint.

You know they briefly carried this system, so they are well aware of its capabilities.

Had it not been for Microsoft’s dirty tactics, it’s likely we would be happily cooperating right now.

So when they learned of my intentions, I was warmly received."

"How much loss did Penpoint recoup for you?" Dean wanted to hear the main points.

Durell proudly held up two fingers.

"Twenty million?" Dean was somewhat surprised by this figure.

"There’s no need to be surprised. If it weren’t for NCR knowing Go company was in trouble,

we could have sold it for a higher price. Now, the deal we got was the result of being pressured."

Dean dismissed Durell’s rueful attitude with a nonchalant twist of his mouth.

Selling for twenty million was a high price, even without Go company’s current crisis.

"How did you convince them to offer that price?" Dean knew Durell must have used some tactics.

Upon mentioning this, Durell became animated, "Dean, I must say your name is quite useful.

I’m curious, did you have some disagreement with them?

The people at NCR almost did a 180-degree turn in attitude after hearing you were also interested in the system.

I’m certain it was a kind of possessiveness over someone else’s beloved!"

"Maybe they just believe in my taste?" Dean said jokingly.

It seemed that the refusal at the Ohio party left a deep impression on Charles.

"Anyway, with your name and the help from a few other friends of mine in the background, Penpoint sold for a decent price."

With Durell’s strong network, setting up a play for NCR secluded in Ohio wasn’t difficult.

Of course, it was also because of NCR’s influence in the Midwest that Durell dared to do this.

In Silicon Valley or the East Coast, he definitely wouldn’t consider such tactics.

But for NCR, the deal might have been worth it since they urgently needed it.

Durell’s scheme merely raised the bidding for Penpoint a bit, but ultimately, NCR needed the system.

After all, no one is a fool; without the inherent value of the chip, nobody would be willing to pay up happily.

"What about AT&T?" Dean, not satisfied with just one story, was waiting for the next course.

"Although we sold the hardware design for the pen computers, the business with AT&T isn’t over yet."

Durell smiled mysteriously; he had also prepared some tactics for AT&T.

However, dealing with this behemoth obviously couldn’t be as direct as dealing with NCR.

Before truly netting them, Durell had to throw out enough bait.

"So what exactly is your deal with them?" Dean’s curiosity was piqued.

"The hardware design group only sold for a few million US Dollars, because AT&T didn’t have an urgent need to enter the pen computer market.

Of course, after I showed them several pen computers currently on the market, the situation has improved a bit.

Still, that’s not enough; I feel I can push a little harder."

Durell then looked at Dean with a mischievous grin, "On the basis of Go company, I’ve also established another derivative company, EO."

"What?" Dean was stunned by Durell’s baffling move.

Go company was already in enough trouble, and now he’d started another similar company?

"EO is still targeting pen computers, but this time we’re making both the software and hardware.

Also, we’ve made many design changes; it’s quite different from Go company’s previous products.

If all goes well, the product will be launched next year," Durell seemed as confident as ever.

However, the more he heard, the more confused Dean became; he remembered Durell as not being so reckless.

Seeing Dean’s puzzled expression, Durell did not continue to explain.

"Alright buddy, we’re almost there.

Now it’s time to look forward to how much wealth AOL can bring us."

Durell was a top venture capitalist; even in the face of a failed investment, he aimed to turn decay into magic.

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