Chapter 504 The richest man’s attitude is crucial

The atmosphere in the conference room suddenly became solemn and focused the moment Liu Xiangdong began his report.

On the electronic screen, clear lines and jumping numbers outline JD.com’s amazing growth trajectory over the past few years.

"Dear shareholders, please look!" Liu Xiangdong said in a loud, calm and confident voice. "Let's first review JD.com's growth history."

The PPT screen switches, and a shocking development trend chart comes into view:

"From 2010 to 2012, GMV jumped from 10.2 billion to 60 billion, with a compound annual growth rate of over 140%. It is expected to exceed 100 billion this year."

A low murmur of admiration suddenly rang out in the room.

Tiger Fund's CEO, Zhang, nodded slightly and exchanged a satisfied glance with DST's CEO, Zhou, who sat beside him. Capital Today's CEO, Xu Xin, was jotting down notes in his notebook, a smile playing on his face.

Liu Xiangdong's tone was full of pride, "In terms of revenue, we achieved 60 billion in net revenue last year, a year-on-year increase of 96%.

Although the company is not yet fully profitable, its gross profit margin has increased from 5.5% in 2011 to 8.4% last year, and its core self-operated e-commerce business has achieved profitability for three consecutive quarters.

Xu Xin couldn't help but interject, "This growth trajectory is quite impressive, especially with the continued improvement in gross profit margin during the period of large-scale investment."

As an early investor in JD.com, her praise was filled with genuine satisfaction.

Liu Xiangdong nodded in greeting and then switched to the logistics section: "I believe that what you are most concerned about is JD Logistics construction.

As of now, JD.com has established modern logistics centers in six major regions: North China, East China, South China, Southwest China, Central China, and Northeast China.

The total area exceeds 1 million square meters, and its own delivery network covers more than 300 cities across the country, with more than 10,000 delivery personnel.

I zoomed in on a map, and densely packed logistics nodes flashed on the screen:

"The '211 Limited Time Delivery' service has become popular, which means JD.com has built a barrier in user experience that is difficult for other competitors to reach.

We have invested more than 5 billion yuan in logistics over the past three years, but this investment is paying off handsomely.”

Hearing these solid and improving data, the shareholder representatives all showed satisfied smiles on their faces.

Tiger Fund's CEO Zhang whispered to DST CEO Zhou with a smile, "This investment seems to be even more successful than expected."

Song Ci listened to the report while looking through the documents.

The "Proposal on the Company's Application for an Initial Public Offering and Listing on a U.S. Stock Exchange" lists in detail key information such as the size of the offering and the use of funds.

The "Proposal on Amending the Company's Articles of Association (Draft)" clearly stipulates the terms of Class A and Class B equity structures.

His eyes occasionally lingered briefly on a few key operating data, but his expression remained calm.

The discussion then entered into substantive stages.

Liu Xiangdong looked around the audience and said solemnly, "Regarding the offering price range, the underwriters suggest setting it between US$19 and US$21.

Based on this calculation, the scale of funds raised from this IPO will be around US$1.5 to US$1.7 billion.”

"Is this range too conservative?" DST CEO Zhou adjusted his glasses. "Considering JD.com's growth rate and market position, I think we can be more aggressive."

Mr. Zhang of Tiger Fund responded, "I agree with Mr. Zhou. The capital market is currently quite enthusiastic about e-commerce concepts, and Alibaba is also preparing for its IPO. We should seize this opportunity."

After some discussion, everyone reached a consensus: to first set the issue price range at US$19 to US$21, and then adjust it based on the roadshow situation.

When discussing the issuance structure, Xu Xin of Capital Today asked with concern, "How will the ratio of new and old shares be arranged in this issuance?"

Liu Xiangdong was well prepared: "The initial plan is to mainly issue new shares, with an estimated 80% being new shares and 20% being sold by old shareholders.

This will ensure that the company has sufficient funds for development and provide appropriate liquidity to early investors.”

When it came to the crucial issue of equity structure, Liu Xiangdong stated firmly: "To ensure the long-term and stable development of the company, the proposal proposes a structure of Class A and Class B shares. Each Class B share carries 20 times the voting rights."

He paused, his eyes sweeping across the room. "This is to ensure that after the listing, we can continue to implement our established strategy and not be disturbed by short-term market fluctuations."

Tiger Fund's CEO, Zhang, immediately stated: "We fully support it. Investing in JD.com is investing in Mr. Liu. Maintaining stable control is in the interests of all shareholders."

DST CEO Zhou added: "This type of equity structure is very common in the US stock market. From Google to Facebook, it has proven its value to the long-term development of technology companies."

Xu Xin smiled and nodded, "Capital Today has believed in Mr. Liu's ability since day one. We hold Class B shares, and this decision has never changed."

After saying that, everyone's eyes turned to Song Ci, because Tengda Group holds 18.81% of the shares, making it the second largest shareholder of JD.com, and holds Class B shares with 20 times the voting rights.

More importantly, Tengda is not only a financial investor, but also an important part of JD.com's strategic ecosystem. The traffic entrances of WeChat and Weibo are crucial to JD.com's growth.

After a moment's silence, Xu Xin spoke cautiously, "Mr. Song, as the most important strategic shareholder, I wonder what Tengda's considerations are regarding shareholding arrangements after the IPO?"

Mr. Zhou added: "Mr. Song, this is directly related to the issuance structure design."

Mr. Zhang of Tiger Fund expressed anticipation: "Especially the lock-up period arrangement. If Tengda can commit to a 180-day lock-up period, it will play a significant role in stabilizing the stock price."

Liu Xiangdong appeared calm, but inside he was a little nervous. Although he had discussed this with Song Ci before, the final decision would be made in a formal setting.

Under everyone's gaze, Song Ci slowly put down the documents, leaned forward, and placed his hands on the table. His movements were calm, yet they carried a breathtaking majesty.

"Everyone, please rest assured." The voice was calm but powerful. "Tengda's investment in JD.com has never been a purely financial investment."

He first looked at Xu Xin and Mr. Zhou. "Regarding our shareholding, Tengda has no plans to reduce it. On the contrary, we have decided, as a cornerstone investor, to subscribe for $100 million in new shares during the offering."

There was a sudden commotion in the conference room, and several fund representatives exchanged surprised glances.

Song Ci turned to Liu Xiangdong and said, "Don't worry about the voting rights issue. We and Mr. Liu already have a joint action agreement.

Tengda's voting rights will continue to be entrusted to Mr. Liu. I believe that under Mr. Liu's leadership, JD.com will be able to maintain its competitive advantage in the e-commerce field."

Finally, a solemn promise: "Regarding the lock-up period, Tengda promises not to sell any shares within 180 days. We are optimistic about the long-term value of JD.com rather than short-term stock price fluctuations.

In fact, I believe JD.com is still undervalued, especially after the synergy with the Tengda ecosystem is fully unleashed.”

"That's great!" Liu Xiangdong's voice rose slightly with excitement, "Mr. Song, JD.com will always remember Tengda's support!

With such a strategic partner, I am absolutely confident that we can bring better returns to all investors after the listing."

The atmosphere in the conference room suddenly became lively.

Xu Xin's eyebrows lit up with joy: "With President Song's words, we are completely reassured. Tengda's participation will send an extremely positive signal to the market."

Mr. Zhang from Tiger Fund laughed heartily: "It seems that the offering price range can indeed be adjusted upwards."

One issue after another was discussed and passed, and the noise of the shareholders' meeting gradually dissipated as the sun set.

The cocktail party hosted by Liu Xiangdong for shareholders and important partners is about to begin.

Song Ci originally wanted to find some quiet time and not attend the event. Just as he was about to leave quietly, he was stopped by Liu Xiangdong and Lei Jun on his left and right.

Liu Xiangdong's face was filled with enthusiasm that could not be refused, and Lei Jun beside him also joined in with a smile.

"Boss Song, how can you, the biggest contributor, be absent from this celebration party? If you don't give face to Boss Liu, you have to give me some face and have a drink together?"

Song Ci looked at these two influential figures in the Internet world and smiled helplessly, knowing that he could not avoid the excitement tonight.

At the cocktail party, under the crystal chandeliers, people were dressed in elegant clothes and drinking clinking glasses. The air was filled with the scent of success and capital.

Song Ci found a relatively quiet corner and looked out the window at the night view of Peking and the crowds in the hall in a daze.

JD.com's current glory is the result of the seed planted by his key investment back then. Now it has grown into a towering tree and is about to yield abundant fruits.

As my thoughts drifted away, Liu Xiangdong came over with a glass of red wine. He had obviously already toasted everyone and there was a strong smell of alcohol around him.

However, his eyes were still bright and burning, his face was flushed, and he was at the peak of satisfaction.

"Boss Song, why are you hiding here all by yourself?"

Song Ci came back to his senses, clinked his glasses together, and smiled, "Brother Dong, you are the star today, and it's time for you to socialize with everyone. I just want to quietly savor the joy of JD.com's success."

When Liu Xiangdong heard this, he couldn't help but recall the hardships he faced when he first started his business at the counter in Zhongguancun many years ago.

With a serious expression, he said sincerely, "Mr. Song, let's not talk nonsense between us. Without your support and trust back then, JD.com wouldn't be what it is today. I must drink this glass of wine. Thank you!"

Before he finished speaking, he raised his glass and drank it all in one gulp, showing his honesty and gratitude.

Song Ci also took a sip and waved his hand, "Brother Dong, you're too kind. Investing in JD.com was one of the best decisions I've ever made."

What I value is you as a person, your courage and vision to get things done and build logistics. This is the success you deserve."

The two chatted about some interesting things that happened in the past and the current situation.

Song Ci changed the subject and asked casually, "The current domestic e-commerce landscape seems to be divided between Alibaba and JD.com, but in reality, there are undercurrents.

Alibaba dominates the platform ecosystem, while JD.com focuses on self-operated businesses and logistics. "Brother Dong, what are your plans for the next step? Where will your future growth be?"

Liu Xiangdong's smile faded and his expression became serious. After a moment of hesitation, he glanced at the lively cocktail party.

He lowered his voice, but spoke with unwavering determination: "Finance! My next step is to fully develop JD Finance."

He paused for a moment, as if recalling a key moment: "On this year's New Year's Eve, WeChat red envelopes became a legend.

This made everyone see clearly how deep and vast the ocean of internet finance is! Payment, wealth management, credit...each of these is a trillion-dollar market.

JD.com cannot just be a seller; it must become a comprehensive service platform connecting users, suppliers, and partners. Finance is the key to connecting all these links.”

Song Ci nodded thoughtfully: "It is a direction, and an inevitable direction. The ultimate form of the ecosystem must include a closed financial loop."

"Yes!" Liu Xiangdong found a kindred spirit, his tone filled with regret and anxiety, "Mr. Song, to be honest, JD started late.

In the early years, funds were limited, and all resources were invested in logistics, warehousing and supply chain. This is our root, and I have no regrets.

By the time JD.com acquired a payment license through the online banking acquisition in 2012 and launched JD Pay, the market had already changed.

Your WeChat Pay and Alipay divide the world, and the online payment landscape is set, making it difficult for latecomers to break in."

He gripped his wine glass tightly, his expression unable to conceal his helplessness: "In the payment war, JD.com missed the best opportunity.

But JD.com must not miss out on the wave of internet finance again! This isn’t a matter of choice, it’s a matter of survival.”

Liu Xiangdong organized his thoughts, leaned forward slightly, and explained his idea to Song Ci:

"My idea is to provide supply chain financial services such as small credit loans, cashing loans, and bill cashing to suppliers and sellers on the platform based on transaction flow, credit, and inventory.

Only when they grow stronger can JD.com's platform ecosystem prosper. The second, and crucial, step is to focus on end users."

His eyes were blazing and his voice was resounding, “In order to lower the consumption threshold, especially to stimulate the purchase desire of high-priced goods such as home appliances and digital products, I plan to launch a consumer credit service.

Allow users to pay in installments, or consume first and pay later. Simply put, it is to give high-quality users a 'virtual credit card'."

Song Ci understood clearly that this was the prototype of the future "JD Baitiao", and its strategic significance was a strong feedback to the core business of e-commerce.

This can strengthen JD.com's competitive advantage, directly stimulate GMV growth, and significantly increase user stickiness. Users who use "Bai Tiao" installment payments will naturally choose JD.com first for their next purchase.

"It's a great idea," Song Ci praised. "This isn't just about financial services; it's also an extension and reinforcement of e-commerce. It can greatly enhance users' payment experience and spending power."

Upon hearing the affirmation, Liu Xiangdong showed a look of satisfaction, as if "great minds think alike." He then smiled wryly and said, "To be honest, I was also forced to do this. Alibaba has launched 'Huabei', and it's gaining momentum."

If JD.com doesn't have peer-to-peer financial tools, users will be left behind in terms of payment and consumption experience, especially in large-value payments, where they will be very vulnerable. This battle must be fought."

He then briefly elaborated on more ideas, planning to enter the fields of wealth management, insurance, etc. in the future, with the goal of building a financial technology ecosystem.

At the end of the conversation, Liu Xiangdong, perhaps under the influence of alcohol, asked half-jokingly, "Mr. Song, the portal era is coming to an end for the major sectors of the Internet.

As for the rest, in social networking, Tenda has achieved the ultimate and no one can shake it; payment occupies most of the market; and games are a cash cow.

You have control over several major traffic portals. Have you ever thought about personally entering the e-commerce market one day? "

The question was quite sensitive, almost a test of a potential future rival. The clamor of the banquet hall seemed to fade away as Lei Jun approached. Upon hearing the question, he paused, awaiting the answer with keen interest.

Song Ci did not respond immediately. He shook the wine glass lightly, and the bright red wine dripped down the wall of the glass.

His eyes swept across Liu Xiangdong's inquiring eyes, then across Lei Jun's curious face, and finally looked at the bright city lights outside the window, as if examining the entire Internet landscape.

After a while, amidst the noisy background, he slowly uttered a single word, incredibly clear: "Yes."

The sound was quiet, but like a pebble dropped into a lake, it sent ripples through the hearts of Liu Xiangdong and Lei Jun. A single word, crisp and clear, yet imbued with infinite possibilities.

(End of this chapter)