Due to the listing of brain-computer interfaces, the main contents of Kechuang Bio's prospectus need to be completely redone.
The most important information in a prospectus is the company's valuation, total share capital, and offering price.
Originally, the three underwriters, CICC, CITIC Securities, and CITIC Construction Investment, held no fewer than ten joint meetings with the six major shareholders of Kechuang Bio before finalizing these arrangements.
Li Miaomiao attended the meeting as Zheng Li's plenipotentiary representative.
Now we need to start from scratch.
Because Kechuang Bio only provides quarterly reports to its major shareholders, and shareholders like IDG and Temasek hold very small stakes, they cannot participate in the company's daily operations and can only participate in board decisions at most.
However, since Zheng Li was not in Suzhou, the board of directors rarely held meetings.
The 2020 annual report stated that the research and development of brain-computer interface devices for mobile phones was expected to be completed in 2021.
We hadn't even received the first quarter report yet, but Zhengli's progress was so fast; they had already signed patent licensing contracts with major manufacturers in January.
The contract with DaMi was signed in the first quarter, but due to a private agreement with Lei Jun, the laboratory testing equipment was provided to DaMi ahead of schedule.
Of course, IDG Capital, Temasek, and Goldman Sachs received the news earlier than the official announcement; they learned about it after the patent licensing for the brain-computer interface technology developed by Kechuang Bio was approved.
The news came too late, but the listing materials had not yet been submitted to the stock exchange, and major shareholders demanded a revaluation of Kechuang Bio.
It's impossible to value brain-computer interfaces based on the value of a single endorphin now that we have them.
Li Shuyao said, "There's a crucial question. Could I inquire about it beforehand?"
Li Miaomiao knew it was definitely a question that would put her in a difficult position, otherwise Li Shuyao would have just asked directly, "Go ahead and ask."
Will the iPhone 13 have brain-computer interface functionality? If the iPhone 13 does have brain-computer interface functionality, I'd really like to switch to one.
Li Miaomiao: "To be honest."
Li Shuyao lowered her head and said, "I just want to know if Kechuang Bio has signed a contract with Apple, or if you have reached a cooperation agreement. If you have, the profit forecast for 2021 will be a completely different valuation."
Li Miaomiao realized that in some aspects, she had a much deeper understanding than her older sister, who graduated with a degree in finance and was pursuing a master's degree at Yenching University.
She gained a deeper understanding of the saying that experience is the best teacher:
“A few days ago, after the patent registration for Kechuang Bio was completed, I was chatting with Young from IDG Capital, the head of investment in IDG's biopharmaceutical industry, and he raised a point of view.”
Li Shuyao was quite interested in this kind of casual conversation among big shots, unaware that Li Miaomiao was already a big shot herself: "And then?"
Li Miaomiao continued, "His general idea is that from the artificial synthesis of endorphins to brain-computer interfaces, Zheng Li has fully proven that his initial research on endorphins was not a flash of genius, but rather a process that can continuously output endorphins."
"Therefore, the valuation of Kechuang Bio cannot be based on the patent licensing of endorphins and brain-computer interface mobile phones."
"The greatest value of Kechuang Bio lies in Zheng Li. At only twenty years old, he has already completed two patented research and development projects in the field of biomedicine that can be described as monopolistic. His future is limitless."
“Science and technology innovation biotechnology should be valued from its source. We should value it based on Zheng Li’s R&D capabilities.”
Li Shuyao couldn't help but say, "The problem is that this kind of thing can't be valued. As for R&D capabilities, can Zheng Li guarantee how many patents he'll have in the future? And how many of those are truly valuable, like brain-computer interfaces and endorphins?"
"This is something that cannot be quantified at all."
Li Miaomiao gestured for her to calm down: "So Young proposed not to give up this listing opportunity. IDG Capital is willing to invest in Kechuang Bio's Series C investment without any reason. As long as Zheng Li is still at Kechuang Bio, even if the investment reaches Series Z, IDG will participate in the Series Z investment."
Li Shuyao: "Isn't this just wanting to eat it all by yourself?"
Li Miaomiao: "Goldman Sachs and Temasek both expressed the same sentiment. They both indicated that they are not in a hurry to go public. If Kechuang Bio lacks funds for R&D, they are willing to participate in the next round of investment, but they are unwilling to accept an unreasonable valuation."
“They are willing to wait ten or twenty years until Zheng Li’s research capabilities are fully demonstrated before going public.”
"Even Lei Jun, the CEO of Da Mi, thinks the same way."
"Science and Technology Innovation Corporation will fully compensate you for the liquidated damages as the underwriters."
Li Shuyao: "It's not us, I'm just an intern. If you don't go public, I guess the leaders at CICC will be losing sleep for a while and will be so depressed."
She couldn't help but laugh out loud at the thought.
Li Miaomiao continued, "Don't rush, I haven't finished yet. After reporting the situation to Zheng Li, Zheng Li said that we will still go public this time, but the valuation for the IPO does need to be renegotiated."
Li Shuyao asked, puzzled, "Since IDG and Goldman Sachs are willing to invest, and Kechuang Bio doesn't lack money, why is it in such a hurry to go public?"
"If Zheng Li wants to cash out his stocks, he can just sell some to these investment banks."
Li Miaomiao shook her head and said, "I don't know what Zheng Li is thinking either. Although I consider myself the person who understands him best in the company, I often don't know what he's thinking."
Zheng Li's thinking was simple: he didn't need money and he wasn't short of it. He was close to regaining his spellcasting ability, and once he did, money would be worthless to him.
Whether Kechuang Bio goes public sooner or later is irrelevant to him. Since the contract has already been signed, Zheng Li thinks that going public sooner is fine too, and he can consider it a benefit for the employees.
If the company doesn't go public, senior executives and middle managers won't receive stock options; if it does go public, they will all be able to receive a portion of the shares.
Li Miaomiao sighed, "I thought I could watch a show."
"If you don't go public, I won't have to work overtime every day."
Li Miaomiao: "If you don't want to do it, just quit. During the internship, you don't even need to quit; just tell HR."
Li Shuyao: "I'm just trying my best to see if I can stay at CICC."
Li Miaomiao: "If you want to come to Dongwu Securities in Suzhou, I can help you get into the headquarters. Or if you want to go to IDG Capital, Goldman Sachs, Temasek, etc., I can also help you get an interview opportunity."
"As long as your behavior isn't too outrageous, they'll let you in."
Li Shuyao was somewhat moved, realizing that her younger sister possessed social resources far beyond her imagination: "Thanks, I'll let you know if you need them."
Li Miaomiao could tell that the other party was not very interested: "So if you only consider the value of endorphins and brain-computer interfaces when valuing Kechuang Bio."
"Such a prospectus will most likely not pass the board of directors' approval."
"The value of brain-computer interfaces cannot be calculated solely based on the projected revenue from patent licensing. The most important aspect of brain-computer interface technology is its vast potential for future applications."
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