Chapter 908 The Mystery of Profit
Lao Cheng has retired, and such an important position as the editor-in-chief of Guowen Publishing House cannot be left vacant. After discussion and voting within the publishing house, Gao Xianjun was finally elected as the new editor-in-chief of Guowen Publishing House with a high vote.
Gao Xianjun joined the company in the same year as Li Xin, but he went to college later, graduating at the age of 35, and joined the company in 1982.
The editor-in-chief's office, which had been empty for a day, welcomed its new owner. People were coming and going, and it looked very busy.
Li Xin sat on the sofa in the office, his voice full of envy, and said, "Who would have thought that among our generation, the first one to get a full-time job in the company would be you, Gao!"
The two joined the society in the same year and had very similar experiences in the Chinese Literature Society. They had always had a good relationship, so they had no scruples about chatting in private.
Having just been promoted to editor-in-chief, Gao Xianjun was in high spirits, but his attitude remained humble.
"Others can say this, but it's inappropriate for you to say it."
Li Xin had been the president of Tongwen Society the year before last. Although he was not a full-time employee of Guowen Society, he was still considered a local lord in the group.
It is extremely rare that the two of them joined the company together and both have reached their current positions.
However, unlike Li Xin who was transferred to Tongwen Press halfway through his career and rose rapidly through Tongwen Press to a leadership position, Gao Xianjun was able to stand out among the many senior editors of Guowen Press thanks to his hard work.
Apart from anything else, he has been in charge of the editing and review of the Buhuhu series of books in recent years, and has an extremely saturated workload every day, almost comparable to the 996 programmers in later generations, so much so that he has suffered a lot of health problems in the past two years.
Gao Xianjun is not a competitive person, but his workload and work achievements are obvious to all, so it is only natural for him to become the editor-in-chief.
After chatting for about half an hour, Li Xin stood up and prepared to leave. He reminded Gao Xianjun: "Don't forget to visit the chairman."
Gao Xianjun nodded, "I'll be there soon."
After Li Xin left, Gao Xianjun went to Lin Weimin's office.
In Guowen Publishing House, Lin Weimin is the president and Gao Xianjun is the editor-in-chief. They seem to have equal status, but Lin Weimin also holds a position in Guowen Group and is under the leadership of Gao Xianjun.
Guowen Publishing House welcomed a new editor-in-chief, but the atmosphere in the company has not changed at all. As Lao Cheng said when he retired, it is still a pure publishing house.
But from the perspective of Guowen Group, there have been many changes.
In addition to the legal department newly established in the first half of the year, the advertising service department, which was established half a year ago, has now completely coordinated the advertising and publicity business within the company, and has carried out clustered management of the previously scattered advertising business. It is also constantly expanding its business scope outward and is expected to achieve a revenue scale of over 100 million yuan this year.
The changes that the Advertising Service Department has brought to Guowen Group in a short period of time are undoubtedly enormous, and this is inseparable from a strong female leader who joined Guowen Press.
In November 1994, in the first CCTV advertising bidding, Kongfu Banquet Wine won the title of "Bid King" in 1995 with a bid of 30.79 million yuan.
Almost overnight, the CCTV advertisement "Drink Confucius Banquet Wine, Write Articles for the World" made this little-known company a household name.
In 1994, before winning the bid, Kongfu Banquet's turnover was 170 million.
In the year it won the bid, Kongfuyan Liquor achieved sales revenue of 918 million yuan and profits and taxes of 380 million yuan. Its main economic indicators ranked among the top three in the national liquor industry, making it a well-known domestic brand.
The driving force behind all this is Tan Xisong, who joined CCTV's advertising department in 1993.
When Tan Xisong took over the work of CCTV's advertising department, there was no such thing as prime time for CCTV's premium time slots, but this resource had actually become a scarce advertising time slot. At that time, many advertisers and manufacturers passed notes, made phone calls, and used backdoors to get advertising time in a certain time slot. Any leader could get involved, and the situation was completely out of control.
In desperation, Tan Xisong came up with the idea of bidding.
Since the birth of the first winning bidder in 1994, almost every manufacturer that has won the CCTV advertising bid has benefited greatly from it, and has quickly soared from obscurity. This shows the influence of the CCTV winning bidder.
Tan Xisong's contribution to CCTV's advertising department is indispensable, but CCTV is a public institution after all. At the end of last year, Tan Xisong decided to go into business. Upon hearing the news, Lin Weimin took the opportunity to recruit her to Guowen Group.
Over the past six months, Tan Xisong has fully demonstrated her ability and Lin Weimin's vision.
Recently, after acquiring Hong Kong Tomson Pictures, Mandarin Chinese Films has been preparing for its IPO.
They are all holding companies of the group and are all involved in the film and television industry. Wenhua is going to go public and Haiyan is very unhappy.
That day he came to Lin Weimin's office, and his words and deeds also showed that he wanted Wencheng to experience the joy of going public.
Lin Weimin had to support his subordinate who was so motivated, but Guowen Group had limited resources, and Wencheng had to wait until Wenhua was listed before going public.
Haiyan was overjoyed after getting Lin Weimin's promise.
Just as he was about to leave, Lin Weimin told him, "The publishing house published a novel called The Sky of History some time ago. The content of the novel is good. You can try to adapt it."
Haiyan said hurriedly: "Yes, I will make sure it happens when I get back."
A few days later, Zhu William invited Lin Weimin to visit him under the banyan tree.
The office of Under the Banyan Tree is located in a courtyard house within the second ring road of Yanjing. The house belongs to Lin Weimin, and there is a nameplate with the words "Yanjing Under the Banyan Tree Computer Co., Ltd." hanging on the door.
As soon as Lin Weimin walked into the door, he heard laughter coming from the yard.
"Teacher Lin, you're here!" Zhu William came out and welcomed Lin Weimin into the house.
Since moving to Yanjing from Under the Banyan Tree, Lin Weimin has only been here once, when they moved. Now when he comes again, the entire courtyard is completely different from what it was before.
There are more than a dozen houses in the yard as you enter, all of which have now been converted into offices, and there are people working in each office.
There is a fake banyan tree in the yard, which corresponds to the name "Under the Banyan Tree".
The sound of laughter that Lin Weimin heard when he entered the room was a few young editors fighting over snacks.
Lin Weimin had met several of them before, at the Guowen Society's Internet Creative Writing Competition.
"William, you have caught all the winners of our Internet creative competition!" Lin Weimin joked.
Zhu William smiled and said, "There's nothing we can do. The creative competition selects the elites. Instead of letting others get a bargain, it's better to let our own people get a bargain."
Among the young editors under the banyan tree are Lu Jinbo, the winner of the first Internet Creation Competition, whose pen name is Li Xunhuan, and Chen Wanning and Li Jie, winners of the second competition. Chen Wanning is Ning Caishen and Li Jie is Annie Baby.
Under Zhu William's introduction, Lin Weimin chatted with the editors for a while, and then he was invited into Zhu William's office.
This time, Zhu William invited Lin Weimin over, saying that he wanted to discuss the future development of Under the Banyan Tree with him.
It has been more than a year since the website moved to Yanjing. This period of time has also been a year of rapid development for Rongshuxia. The number of registered users has increased from 100,000 to nearly 800,000, which is a gratifying achievement.
It is the undisputed leader in the field of domestic literary websites, but unfortunately it is of little use.
While the development was rapid, hidden worries began to emerge under the banyan tree.
As the website continued to develop, the company was burning money at an increasingly faster rate. The company's basic operating expenses alone required 300,000 yuan per month, and so far this year, Under the Banyan Tree's revenue has been only 150,000 yuan, averaging less than 30,000 yuan per month, which is one-tenth of its expenditure.
Online literature is now booming. Although Rongshuxia has 800,000 registered users on the Internet, its monetization channels are very limited.
Because of the nature of the website, the advertisements they can receive now are relatively low in both quantity and price.
With the support of Guowen Publishing House over the past year, offline publishing channels have been going relatively smoothly, but publishing is more useful to authors and its help to the website is almost negligible.
During this period of time, Rongshuxia has been in a state of deficit. The financing of Guowenshe has been exhausted this month, but Rongshuxia has not yet found a decent profit point.
Zhu William himself is rich, and he doesn't mind spending some money on Under the Banyan Tree. But after all, Under the Banyan Tree is not just his now. Besides, he always has money coming in but not going out, so no matter how much money he has, it will not be enough for him to spend!
After listening to Zhu William's distress, Lin Weimin fell into deep thought.
In later generations, Under the Banyan Tree developed extremely rapidly around the year 2000. In just a few years, the number of registered users exceeded 4.5 million, making it the undisputed number one literary platform on the Chinese Internet at that time.
But behind the rapid development of the website, there are dangers lurking everywhere.
Joint publishing, paper publishing, radio cooperation, brand cooperation...
I have tried many times to break through the difficulties under the banyan tree, but in the end I always find that this road is blocked.
So in 2002, Zhu William had to sell Under the Banyan Tree to the Bertelsmann Group for 10 million US dollars.
In this timeline, with the help of Guowen Group, Banyan Tree has developed more rapidly than in later generations, but the crisis has also arrived earlier.
If Under the Banyan Tree cannot find a suitable profit model, it will sooner or later collapse.
The development dilemma of Under the Banyan Tree was a problem for Zhu William, but for Lin Weimin it was not difficult, just like an open-book exam.
But he did not give any advice to Zhu William, and Guowen Group is now just a shareholder of Rongshuxia.
"How about this, our group will invest another sum of money in Rongshuxia."
Hearing Lin Weimin's words, Zhu William looked embarrassed.
Of course, the money from Guowen Group was not taken for free, which meant that the shares in Rongshuxia that he held would inevitably be diluted.
It’s not a good feeling to create a website yourself, but end up becoming just a small shareholder.
"What about the valuation?" Zhu William's voice was dry.
"12 million yuan."
The valuation of 12 million yuan has doubled compared to when Guowenshe first invested.
Zhu William looked hesitant, and his mood was conflicted at the moment.
On the one hand, Under the Banyan Tree is developing rapidly and seems to have a bright future. On the other hand, the website has not yet found a profit point, and all the good prospects seem more like a mirage.
Observing Zhu William's expression, Lin Weimin said: "I can understand your feelings, but you should also be aware of the problems that Under the Banyan Tree is facing now. Before a clear profit model is found, this is a money-eating beast. Survival is Under the Banyan Tree's first priority.
If you are worried that your shareholding is too low, we can invest together.
If you don’t want to invest more money in the website, we can lend some money to Rongshuxia to help it develop.”
Having said that, Lin Weimin has already put the answer in front of Zhu William, and it depends on how he chooses.
Zhu William's mind was in a mess and he was extremely conflicted at this moment. He had originally gone to Lin Weimin for advice, but he didn't expect to face such a situation.
Investing money means taking risks, and if you don’t invest, your shares will be diluted. But you can’t give up the money, otherwise the website won’t be able to pay the salaries next month.
"The valuation is 15 million, we raised 3 million, and then lent us another 3 million." Zhu William said gritting his teeth.
Lin Weimin didn't say anything, but looked thoughtful, and Zhu William became uneasy.
He invited Lin Weimin here today, saying that he wanted to ask for advice, but fundamentally he wanted to ask for help. He just didn't expect that Lin Weimin would block the option of voluntary help right away.
After some ideological struggle, he still chose to raise funds. Now it depends on Lin Weimin's decision.
"Okay!" After hesitating for a long time, Lin Weimin finally spoke.
The huge rock in Zhu William's heart fell to the ground. At this time, he no longer had time to think about the shares. Just as Lin Weimin said, survival was the first priority under the banyan tree.
With this 6 million yuan, it will be no problem for Rongshuxia to survive for another one or two years. Maybe it will be able to find a profit model by then?
To put it another way, since Guowen Group has become the major shareholder of Rongshuxia, the risks he has to bear have been much smaller.
"Don't be too stressed. All domestic websites are exploring ways to make money, including Sohu. Rongshuxia is now in a period of rapid development, so you can take your time to think about making money."
After the financing issue was settled, Lin Weimin comforted Zhu William with a few more words.
Zhu William nodded heavily, “You are right.”
In the next two days, Guowen Publishing House formally signed an investment agreement with Rongshuxia, once again investing heavily in this money-eating beast.
Whether in the future or now, Under the Banyan Tree is a money-losing business, and Lin Weimin, who made the investment decision, is well aware of this.
But for Guowen Publishing House, it is an important tool that influences the field of domestic online literature and an indispensable piece of Guowen Publishing House's literary landscape. It must be grasped in one's own hands if one has the ability to do so.
Besides, the inability to make profits for the time being does not mean that profits will not be made in the future, provided that Guowen Group is the major shareholder.
(End of this chapter)
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