I am Hollywood

Chapter 717 - 718: Speculative Mindset

Chapter 717: Chapter 718: Speculative Mindset[Chapter 718: Speculative Mindset]

Throughout May, Eric and Chris were busy working on Firefly Investment Company's acquisition of a stake in the telecommunications operator, Sprint.

Both parties had reached a rough agreement on the transaction in early May, with Sprint planning to issue 400 million shares of stock to Firefly Investment for a capital injection of $1.32 billion. After the deal was complete, Sprint would increase its total share capital to 4 billion shares, with Firefly Investment owning 10% and securing two seats on Sprint's board of directors. If this deal succeeded, Sprint would likely adopt Qualcomm's CDMA technology, thanks to the push from Firefly Investment.

However, the process was far from over once they drafted the deal. Though the barriers to entry in the communications industry were gradually loosening, getting a foothold in such a tightly regulated sector required navigating through layers of approval.

Firefly and Sprint first needed to submit their plan to the Federal Trade Commission (FTC) for antitrust review. Along with owning Qualcomm, which was involved in the re

"I've been in contact with Ian and the others, and I have a good grasp of their general thoughts," Eric nodded.

The employee stock option plan was set to expire this year, and Firefly Investment's team began evaluating the performance of Yahoo's senior management to determine their stock rewards.

Originally, Eric planned to initiate Yahoo's IPO after this stock incentive program ended. However, recently, the top executives unanimously expressed the desire for Eric to delay Yahoo's IPO. Their reasoning was quite sound. The capital market was overly profit-driven, and once Yahoo went public, it would face performance pressures, undermining its current strategy of cautious, steady growth.

After repeated persuading from Yahoo's management, Eric began to reconsider this matter.

A few years back, Eric had originally intended to take Yahoo public in 1995, aiming to cash in on the rapidly inflating Internet bubble. Once his Yahoo stocks moved past the lockup period, he hoped to net a substantial sum as Yahoo's stock price soared.

In hindsight, Eric's plan had a very obvious speculative mindset, subconsciously focusing on cashing out rather than nurturing Yahoo's growth.

Through these years of reflection, Eric recognized that if he maintained such a mindset, his career would inevitably reach a bottleneck at some point in the future.

Seeing Eric lost in thought, Chris asked, "So, Eric, what are you thinking now?"

"I suppose you agree with their idea, right?" Eric smiled, countering his question.

Chris nodded candidly. "The capital markets are currently very favorable toward Internet investments. So, I believe if we delay going public for a few years until Yahoo has a clearer profitability outlook, we can certainly reap greater rewards."

Eric recalled the timeline from his previous reality, where the Nasdaq index began to soar in 1998, skyrocketing from just over 1,000 points to over 5,000 within two years.

If Yahoo went public after 1998, the funds gathered in the initial public offering would have unquestionably been several times those available now. However, under a stringent financial regulatory system, that money would predominantly be allocated to Yahoo's own development rather than completely belonging to Eric. While there were ways to transfer some of those funds, doing so carried legal risks. It certainly paled against the safety of simply offloading personal shares.

Cash out, cash out, cash out...

Eric repeated the word in his mind, suddenly realizing that he wasn't lacking in money anymore -- no matter how much he cashed out, it would still go towards investment.

This sudden clarity brought Eric a sense of enlightenment. He turned to Chris and said, "Let's do it this way; we'll delay the IPO plan, but in any case, we'll aim to complete the IPO before our contract with Microsoft goes into effect."

"Of course," Chris chuckled, relieved, that if Eric had insisted otherwise, he wouldn't have known how to persuade him. "Speaking of which, Microsoft's Windows 95 is set to launch in August. I assume you've already started using this system, right? Microsoft's stock has been on the rise lately; the market seems very optimistic about this new operating system."

While Microsoft confirmed that Windows 95 would launch in late August, several testing versions had already been released, and piracy of copies had spread widely outside the U.S.

Eric most certainly used this now-familiar operating system, stating, "I feel this system could allow Microsoft to monopolize the operating system market, which likely means we're going to be butting heads with them in the coming years. Microsoft has firmly established its dominance in the operating system market. They will undoubtedly look to penetrate the Internet market now. I can't even confirm whether Bill Gates might forcibly tear up our agreement; after all, Microsoft may not want to wait until 1999."

"I feel Microsoft has already begun to show signs of restlessness," Chris replied with a smile. "Steve called me a few days ago, mentioning that Microsoft had reached out to him, hoping he would leave Yahoo to join their upcoming Internet division."

The Steve Chris referred to was Steve Mitnick, who was responsible for Yahoo's technical department and a good friend of Chris from college. In Eric's view, of Yahoo's top management -- Ian Gurner, Jeff Locke, Steve Mitnick, and Tina Brown -- Steve Mitnick was the most critical for Yahoo because he oversaw the core technical R&D for most of Yahoo's major Internet products. If he were poached, Yahoo would undoubtedly face a protracted period of turmoil.

Thus, this news shocked Eric, leading him to instinctively ask, "Really?"

Chris nodded. Seeing Eric's worried expression, he added with a smile, "But you really don't have to worry. I know Steve's character very well. Since he called me, he surely isn't going to leave Yahoo."

Eric couldn't completely set his worries aside, asking, "What about the others?"

*****

/Sayonara816.